TaxTMI 
TaxTMI 
2014 (6) TMI 283
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.... deleting the addition made by the AO on account of Long Term Capital Gain (LTCG) by adopting lower cost of acquisition as on 1.4.1981 on the basis of DVO's report, holding that the reference made by the AO to the DVO u/s 55A of the Income Tax Act, 18961 (the Act) itself was bad in law. 3. The assessee in the present case is a HUF who filed its return of income for the year under consideration on 31.3.2009 declaring total income of Rs.1,000,720. In the said return, the Long Tern Capital Loss of Rs.7,97,583/- was shown by the assessee arising from the sale of its 20% share in the property known as M/s Alfa Engineering Works situated at 221, Station Road, Bhandup (W), Mumbai-400078. The working of the said long term capital loss was given ....
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....al gain Rs.4,03,40,809/- Assessee's shares in the total LTCG @ 20% Rs.80,68,162/- Less deduction u/s 54F being flat purchased Rs.49,00,555/- Long term capital gain Rs.31,67,607/- ========" 5. The addition made by the AO on account of LTCG was disputed by the assessee in the appeal filed before the ld. CIT(A). During the course of appellant proceedings before the ld. CIT(A), an additional ground was raised by the assessee challenging the validity of reference made by the AO to the DVO u/s 55A of the Act and the following submissions were made in support thereof on behalf of the assessee : "The appellant has taken an additional ground of appeal wherein it has challenged the very reference to the DVO by the AO under section 5....
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....) of section 55A only when in his opinion fair market value disclosed by the appellant is less and hence the reference was held to be invalid . The tribunal in this case followed the following decisions: Ms. Rubab M. Kazerani V/s JCIT [2004] 91 ITD 429 (MUM.)(TM) Smt. Krishnabai Tingre V/s Income-tax Officer [2006] 101 ITD 317 (PUNE) The Hon'ble High Court of Bombay has dismissed the appeal of the revenue against the ITAT's order in the case of Daulat Mota vide ITA no 1031 of 2008 dt 22-september 2008. No SLP has been filed against that order. The appellant also placed reliance on the case of Hiaben Jayantilal Shah V/s Income-tax Officer decided by the Hon'ble Gujarat High Court vide special civil application no. 9293 of 1997. The ....
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....VO u/s 55A of the Act itself was bad in law. Accordingly, he directed the AO to delete the addition made on account of LTCG based on the report of the DVO. Aggrieved by the order of the ld. CIT(A), the revenue has preferred this appeal before the Tribunal. 7. We have heard the arguments of both the sides and also perused the relevant material placed on record. The ld. representatives of both the sides have agreed that the issue involved in the appeal of the Revenue is squarely covered in favour of the assessee by the decision of the Hon'ble Bombay High Court in the case of CIT V/s Puja Prints (2014) 265 CTR (Bom) 124, wherein the similar issue was raised by way of the following question of law for the consideration of Their Lordships : ....
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....at a reference could be made to the Departmental Valuation Officer only when the value adopted by the assessee was less then the fair market value. In the present case, it is an undisputed position that the value adopted by the respondent-assessee of the property at Rs.35.99 lakhs was much more than the fair market value of Rs.6.68 lakhs even as determined by the Departmental Valuation Officer. In fact, the Assessing Officer referred the issue of valuation to the Departmental Valuation Officer only because in his view the valuation of the property as on 1981 as made by the respondent-assessee was higher then the fair market value. In the aforesaid circumstances, the invocation of Section 55A(a) of the Act is not justified. 8. The content....