TaxTMI 
TaxTMI 
2014 (2) TMI 78
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....peal against the judgment of the Income Tax Appellate Tribunal ("the Tribunal" for short) dated 13.7.2012 raising following questions for our consideration. "a) Whether in the facts and circumstances of the case, the Hon'ble ITAT has erred in law in confirming the order of learned CIT(A) deleting the addition of Rs.81,57,643/- on account of long term capital gain u/s. 48 of the Act by the Assessing Officer on the basis of valuation report called for under section 55A(b)(ii) of the Income-Tax Act? b) Whether in the facts and circumstances of the case, the Hon'ble ITAT has erred in law in completely overlooking the provisions of section 55A(b)(ii) of the Income-Tax Act while passing the impugned order confirming the deletion of the addi....
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....ore, recorded that looking to the status of the property, there was strong reason to believe that the assessee had underestimated the value of sale consideration by adopting lower rate. Simultaneously, fair market value as on 1.4.1981 was also not correctly taken. He, therefore, referred the question of such valuation to DVO. DVO opined that the fair market value as on 14.11.2005 was Rs.13,73,90,000/- against declared sale value of Rs.8,51,00,000/- by the assessee. DVO also opined that value as on 1.4.1981 should be assessed at Rs.94,00,000/- as against that shown by the assessee of Rs.1,03,00,000/-. 5. The Assessing Officer issued a show cause notice to the assessee why such estimated rates not be adopted for the purpose of fair market ....
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.... claimed by the assessee by more than such percentage of the value of the asset as so claimed or by more than such amount as may be prescribed in this behalf; or (ii) that having regard to the nature of the asset and other relevant circumstances, it is necessary so to do, and where any such reference is made, the provisions of subsection( 2),(3)(4),(5) and(6) of section 16A, clauses (ha) and (i) of sub-section(1) and subsections (3A) and (4) of section 23, subsection( 5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall with the necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section(1) of sec....
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....e cost of any improvement thereto. Main thrust of section 48 of the Act, therefore, is the full value of consideration received or accruing as a result of the transfer of the capital asset as reduced by expenditure mentioned therein and the cost of acquisition of the asset. Section 55A, as we have noticed, refers to the reference to DVO for ascertaining the fair market value of a capital asset. Such ascertainment of fair market value with the aid of the DVO's report would have no relevance for the purpose of determining full value of consideration received or accruing as a result of the transfer of the capital asset for the purposes of section 48 of the Act. 12. In that view of the matter, the reference to DVO for ascertaining the fair m....
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....:- "20. Quite apart from the CIT (A) discarding the very Valuer's Report, we find that the reference itself was not competent insofar as he wanted to ascertain fair market value of the land on the date of sale. In absence of any material on record before us by which Assessing Officer could have concluded that the consideration indicated in the sale-deed did not reflect the full consideration received by the assessee, it was not possible to assess the capital gain by estimating what would be the fair market value of the land through valuer's report. 21. Decision of the Delhi High Court in the case of Commissioner of Income-Tax V/s. Smt.Nilofer I.Singh reported in (2009) 309 ITR 233 was also brought to our notice; wherein, relying on th....
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....et value of the asset exceeds the value of the asset so claimed by the assessee by more than such percentage of the value of the asset so claimed or by more than such amount as may be prescribed in this behalf; or (ii) that having regard to the nature of the asset and other relevant circumstances, it is necessary so to do. Sub-clause(i) of clause (b) also for the same reasons recorded above, would have no bearing on the fair market value as on 1.4.1981. The Assessing Officer had not resorted to sub-clause(ii) of clause (b). In any case, clause(b) would apply where clause(a) does not apply since it starts with the expression "in any other case". In other words if assessee has relied upon a Registered Valuer's Report, Assessing Officer can pr....