TaxTMI 
TaxTMI 
2013 (5) TMI 500
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....nt rights to M/s. P.N.K. Construction for an aggregate consideration of Rs.90,34,200. The stamp duty valuation authorities adopted the fair market value (FMV) of the aforesaid property at Rs.3,20,28,000. According to assessee, the FMV adopted by the valuation authorities was exceedingly high and sought two independent valuation reports of the property. Assessee adopted higher of the two valuations determined by the valuation, computed as share of the sale proceeds of the property i.e. (38% share) and worked out the capitalgain at Rs.15,94,328. In doing so, assessee took the value of the land as on 01.04.1981 based on valuation report at Rs.6,25,590. At the time of computing the assessment, AO referred the issue of FMV both as on 01.04.1981 ....
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....nfirming an addition of Rs.54,30,860 by invoking the provisions of section 50C for the Agreement of Development entered into on 09.12.2005 and adopting Rs.1,68,85,645 as the market value as per the Valuation Report of the Income Tax Department (DVO) against the agreement value declared by the appellant at Rs.90,34,200. 3. On the facts and circumstances of the case, the learned Commissioner of Income Tax (Appeals)-II ("the CIT(A)" erred in confirming the reduction of the FMV as on 01.04.1981 at Rs.5,21,913 as against the certified FMV adopted by the appellant at Rs.6,25,590". 3. At the outset the learned Counsel did not press Ground Nos.1 & 2 with reference to the adoption of FMV under the provisions of section 50C as on 0....
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....ks jurisdiction for referring the FMV under section 55A wherein the Valuation determined by the DVO is less than the FMV declared by assessee. This issue was discussed elaborately by the Coordinate Bench in the case of Smt. Sarla N. Sakraney v. ITO [2011] 130 ITD 167 wherein it was held: "12. We have heard the rival submissions. As far as Ground No. 1 is concerned, we are of the view that the reference to the DVO was invalid. On this issue, learned DR relied on the order of learned CIT(A). While learned counsel for the assessee relied on the decisions which were cited before learned CIT(A) and further drew our attention to the decision of Hon'ble Bombay High Court in the case of Daulal Mohta (supra), wherein, Hon'ble Bombay ....
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....A of the Act to the DVO for determination of the fair market value of the property?" In para Nos. 4 & 5 of its Judgment of Hon'ble High Court held as follows :-- "4.The Tribunal in its order dated 23rd July, 2004 has categorically observed thus :- "The first issue that arises for our consideration is whether the reference made by the Assessing Officer to the DVO under section 55A is bad in law under the facts and circumstances of the case. This issue, in our considered opinion is covered in favour of the assessee and against the revenue by the Judgment in the case of Rubab M. Kazerani reported in 91 ITD 429 (Mum.)(TM). Further the assessee also covered by the Third Member decision of the Pune ....
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....imate made by the registered valuer, if the Assessing Officer is of the opinion that the value so claimed is less than the fair market value. In any other case, as provided under clause (b) of section 55A, the Assessing Officer has to record an opinion that (i) the fair market value of the asset exceeds the value of the asset as claimed by the assessee by more than such percentage or by more than such an amount as may be prescribed; or (ii) having regard to the nature of the asset and other relevant circumstances, it is necessary to make such a reference. As can be seen from the communication dated nil from DVO to the petitioner insofar as the fair market value of the property as on 1st April, 1981 is concerned, the petitioner had claimed t....