2016 (5) TMI 425

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....he Tribunal reads as under:- "1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition made by the A.O. by substituting the sale consideration determined by Stamp Duty Authority for value determined by DVO without appreciating that DVO has submitted its report on the basis of factual position and sale instances and A.O. is right in replacing it for sale consideration determined by Stamp Duty Authority?" 3. The brief facts of the case are that the assessee is a company engaged in the business of textile manufacturing. During the financial year relevant to A.Y. 2009-10 the assessee company has sold a property comprising land and structures. An agreement for sale has been en....

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....A of the Act cannot be substituted full value of consideration received on sale of the property which is not applicable in the instant case because the stamp duty authority value the property at Rs. 25,14,76,226 which is much lower than the market value of Rs. 40 crores. The compensation received was much more than the stamp duty valuation. The assessee protested against the reference made to the DVO. The assessee relied upon the decision of the ITAT in the case of ITO v. Chandrakant R Patil and Others (2011) 56 DTR (Ahd) (Trib) 449 and Jayshankar S. Vaid v. DCIT (2010) 35 SOT 46 (Ahd) and submitted that reference can be made for valuation u/s 55A of the Act to ascertain the fair market value of the property and not the consideration. The a....

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....officer if the condition as contained under section 53C of the Act is met but in the instant case full value of consideration is taken higher of stamp duty valuation. The value of the structure was valued by the Government valuer. The valuation of the structure is valued after its demotion. The DVO valued after demolition was completed based upon the future value of the structure. Thus the assessee submitted that reference to section 55A to the DVO was illegal and bad in law as ascertaining the fair market value of a capital asset and not for ascertaining full value value of the consideration. The sale consideration was higher than the value determined by the stamping authority. The valuation as per the DVO is 1%. The structure was already ....

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....e the income from gain of building as STCG. The break up offered by the assessee is Rs. 38 crores for land and Rs. 2 crores for building. The A.O. has referred the matter to DVO whereby the value of land determined at Rs. 38,08,30,000/- and structure at Rs. 2,52,69,000/-. The A.O. has brought to tax the gains accordingly on both STCG and LTCG. The ld. CIT(A) deleted the addition. Thus, the ld. D.R. supported the addition made by the A.O. by relying on the order of the A.O. 6. The ld. Counsel for the assessee submitted that the stamp duty valuation is Rs. 25,14,76,226/- while the agreement value is Rs. 40 crores which is much more than stamp duty value. The A.O. cannot be refer the matter to the DVO. The ld. Counsel submitted that the DVO v....