TaxTMI 
TaxTMI 
2015 (4) TMI 665
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....herein the capital gains is computed u/s. 50 and as the provisions of section 50C were not applicable to depreciable assets, the addition of Rs. 1,56,03,500/- made by applying the provisions of section 50C is not justified at all. 1.2 Without prejudice to ground no 1.1, the assessee submits that the learned CIT(A) erred in confirming the addition made of Rs. 1,56,03,500/- without appreciating that the fair market value of the asset sold was less than the stamp duty valuation and hence, there was no reason to make any addition u/s. 50C. 1.3 The learned CIT(A) failed to appreciate that - * The sale consideration received by the Appellant Company was the fair market value of the property as on the date of transfer and that no cash transaction was involved and the fair market value determined by the DVO was not correct. * The building in which the office was located was constructed much prior to year 1954. * The condition of the office at the time the Appellant Company sold the said office was not good, especially the basement part which used to have a lot of water clogging during monsoon. The description of the present condition provided by the learned DVO of the basement is due ....
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....aused the assessee as to why the value so considered by the Stamp Valuation Authority be not considered as full value of consideration for the purposes of computing capital gain on sale of the property on the strength of the provisions of section 50C of the Act. Assessee submitted before the Assessing Officer that the said building was an old building constructed in 1954 and the tenements were not in good condition and therefore the valuation adopted by the Stamp Valuation Authority for the purposes of payment of stamp duty was in excess of the Fair Market Value of the Property. The Assessing Officer, having regard to the provisions of sub-section (2) of section 50C of the Act referred the valuation of the property to the Departmental Valuation Officer (DVO), who has determined the Fair Market Value of the property at Rs. 6,56,24,654/-. Ostensibly, the Fair Market Value determined by the DVO was higher than the value adopted by the Stamp Valuation Authority and therefore in terms of sub-section (3) of section 50C of the Act, the value adopted by the Stamp Valuation Authority for the purposes of payment of stamp duty is to be taken as the full value of the consideration received or ....
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....s on the date of transfer should be adopted for the purposes of section 50C of the Act, which in the present case is 23.12.2004. 9. We have carefully considered the rival submissions. On this aspect, we find that the said plea has been raised by the assessee before us, and it was not raised before the lower authorities. We deem it fit and proper to remand this aspect back to the file of the Assessing Officer, who shall examine the same in accordance with law. Needless to say, the Assessing Officer shall allow the assessee an opportunity of being heard before passing an order afresh on this aspect. Thus, on this aspect assessee partly succeeds for statistical purposes. 10. The Grounds of Appeal Nos.2.1 to 2.3 raised by the assessee relate to a disallowance of Rs. 75,000/- sustained by the CIT(A) in terms of section 14A of the Act. On this aspect, the facts are that in the course of assessment proceedings, Assessing Officer noted that assessee had earned certain incomes by way of dividend from mutual funds, etc. which was exempt from tax. He, therefore, invoked section 14A of the Act and disallowed 10% of the total exempt income, i.e. Rs. 20,41,929/- as an estimated expenditure inc....
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....sessee's own case vide ITA Nos.1005/PN/2007 and 88/PN/2008 respectively dated 30.06.2011 has setaside the issue back to the file of the Assessing Officer for fresh verification. Following the aforesaid precedent, which is not disputed by the Ld. Departmental Representative, on this aspect we restore the matter back to the file of the Assessing Officer to decide it afresh in the light of the direction of the Tribunal contained in order dated 30.06.2011 (supra). Thus, on this aspect, assessee succeeds for statistical purposes. 14. By way of Ground of Appeal No.4, assessee has challenged the order of the CIT(A) in confirming an ad-hoc disallowance of Rs. 10,57,860/- made out of miscellaneous expenses. In this context, relevant facts are that during the assessment proceedings, assessee was found to have incurred various expenses like sales promotion expenses, conference expenses, advertisement expenses, etc. which was grouped under the head "miscellaneous expenses". The total of such expenditure was a sum of Rs. 10,57,86,072/- and the Assessing Officer on an ad-hoc basis disallowed 1% of the same on the ground that it was not incurred wholly and exclusively for the purposes of busines....