2009 (3) TMI 1009

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....tion of land sold by the appellant at Rs. 1,81,08,792/- in place of Rs. 1,51,00,000/- shown by the appellant. 2. The learned Commissioner of Income Tax (Appeals) erred adopting valuation made by the stamp valuation authority by invoking the provision of section 50C of the IT Act 1961 even though appellant objected before the assessing officer that the such valuation exceeds the market value of the property as on the date of transfer. 3. The learned Commissioner of Income Tax(Appeals) committed a gross error of law and fact in not directing the assessing officer to refer the valuation of the said property to a valuation officer as required under sub section (2) of section 50C of the Act. 4. The learned Commissioner....

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.... assessee with regard to sale value of Rs. 1,81,08,792/- in view of the section 50C of the IT Act. The assessee has explained before the AO that the total consideration for sale of property should be taken at Rs. 1,51,00,000/- and not at Rs. 1,81,08,792/- as provided u/s 50C for the following reasons: a) Our client was manufacturer of silicate but due to strike of workers since 1999 manufacturing activity was halted and the firm used to carry out some trading and other activities by carrying out manufacturing from outside the factory premises. Due to above reason the condition of the premises had deteriorated and firm was on financial burden due to heavy demands from the workers and union activities which had prohibited the partner....

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....e submitted that according to judgement of the Hon'ble Tribunal, in case AO does not agree with the explanation of the assessee with regard to lower consideration disclosed by him he should refer the matter to DVO for getting its market rate especially on the date of sale to arrive at a conclusion. On the other hand the Ld DR supported the orders of the authorities below. 7. We have heard both the sides, perused the records carefully and gone through the orders of the authorities below. The assessee is a joint owner of the property and sold the property at Bhandup for declared consideration of Rs. 1,51,00,000/- but the stamp valuation authority has followed the market rate of the property at Rs. 1,81,08,792/-. The assessee has explai....

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....igh Court. The Assessing Officer may refer the valuation of the capital asset to a Valuation Officer and where any where any such reference is made, the provisions of sub-sections (2), 3,4,5 and 6 of section 16A, clause (i) of sub-section (1) and sub-sections(2) and (7) of section 23A, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth tax Act, 1957 (27 of 1957), shall, with necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer sub-section(1) of section 16A of that Act. Explanation - For the purposes of this section, "Valuation Officer" shall have the same meaning as in clause (r) of section 2 of the Wealth tax act, 1957 ....