TaxTMI 
TaxTMI 
2016 (5) TMI 1019
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....as per ready reckoner rate and thus the capital gain of Rs. 24,23,000/- has been left to be added. According to him, the assessee along with Mr. Surendra S. Mehra had individually and independently acquired the ancestral land out of Survey Nos. 44 and 45 to the extent of 2 Hector 80R by virtue of family settlement. The above land was sold for a consideration of Rs. 2,16,15,000/- to M/s. Om Sai Ram Steel and Alloys Pvt. Ltd., Jalna vide sale deed No.990/2010 executed on 25-02-2010 before the Joint Sub-Registrar (Class-2), Jalna-1. The aforesaid land is located within the Municipal Area adjacent to the Industrial area of Additional MIDC, Jalna and is a capital asset within the meaning of provisions of section 2(14) (iii)(b) of the I.T. Act as it is situated within 8 kms from the end of the Municipal limit of Jalna. 3. According to the Ld.CIT, as per the Government of Maharashtra Ready Reckoner published for the purpose of valuation of stamp duty the land sold by the assessee falls within the Zone No.1.56 for which an amount of Rs. 1,100/- per sq.mtr as stamp duty is chargeable as per the prevailing rates for the period 01-01-2010 to 31-12-2010. Accordingly, while executing the sal....
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....ration received or accruing as a result of the transfer of a capital asset, being land or building or both in less than the value adopted or assessed (or assessable) w.e.f. 01-20-2009 shall, for the purposes of section 48, be deemed to be the full value of the consideration received or accruing as a result of such transfer. 3.1.2 From the above it is clear that in section 50C(1) the word (or assessable) has been inserted w.e.f 1/10/2009 to take care of such cases. Therefore in this case the valuation of the land for the purpose of income shall be determined as per the amended provisions of sec. 50C(1), because the assessee has sold its land on 25.02.2010. However, keeping in view assessee's objection regarding reassessing the value by an authority other than the stamp duty authority, I find it fair and just. if the valuation arrived at as per the show cause notice is endorsed by the Stamp Duty Authorities. 3.2 In view of the above facts, the issue is restored back to the file of A.O. with the direction to get the computation endorsed by the Stamp Duty Authorities and re-compute the consideration (Value), accordingly. 4. That being so, the assessment order dated 21/12/2012 ....
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....suming jurisdiction u/s.263 of the I.T. Act. He submitted that the assessee during the impugned assessment order has sold the ancestral property. For the purpose of calculating the long term capital gain the assessee had adopted the cost as on 01-04-1981 on the basis of a certificate issued by Government Approved Valuer. Since the fair market value of the capital asset appeared to be more the AO referred the matter to the DVO and after considering the report of the DVO the AO determined the long term capital gain at Rs. 74,65,752/- as per the discussion by him from Para 3 to 8 of the assessment order. 6. Referring to the provisions of section 55A of the Income Tax Act, 1961 the Ld. Counsel for the assessee drew the attention of the Bench to clause (a) of the said section according to which the AO can refer the matter to the valuation officer in case he is of the opinion that the value so claimed by the assessee is at variance with its fair market value. He submitted that the said clause has been inserted w.e.f. 01-07-2012 which is effective from A.Y. 2013- 14. Earlier, the AO could have referred the matter to the DVO only if such value is less than the fair market value. 7....
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.... is only an inclusion of new class of transactions, namely, the transfer of properties without or before registration. Before the amendment, only transfer of properties where the value was adopted or assessed by the stamp valuation authority were subjected to section 50C application. However, after introduction of the words "or assessable" such transfers where the value is assessable by the valuation authority are also brought into the ambit of section 50C. Thus, such introduction of a new set of class of transfer would certainly have prospective application only. In Circular No. 5 of 2010, dated June 3, 2010, issued by the Board, it is made clear that the amendment made by the Finance (No.2) Act, 2009, is prospective in nature and cannot be applied retrospectively. So it is stated therein that the scope of the provisions does not include transactions which are not registered with the stamp duty valuation authority and executed through agreement to sell or power of attorney. Consequently, the amendments have been made applicable with effect from October 1, 2009 and will apply only in relation to transactions undertaken on or after such date." He accordingly submitted that the Ld....
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....ng theory of merger is not applicable to the facts of the present case. He submitted that the Ld.CIT's order is based on facts which the AO while passing the order has not considered, therefore, the assumption of jurisdiction by the Ld.CIT is justified. 12. We have considered the rival arguments made by both the sides, perused the orders of the AO and the Ld.CIT and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the assessee in the instant case along with Mr. Surendra S. Mehra had sold a piece of land for a consideration of Rs. 2,16,15,000/-. We find the Ld.CIT was of the opinion that the assessable value of the property transferred on the basis of the stamp duty payable as per Governments ready reckoner is Rs. 2,66,75,000/- for the entire land. Thus, there is under assessment of fair market value for the purpose of section 50C of the Act amounting to Rs. 50,60,000/- in case of land sold by the assessee and Shri Surendra S. Mehta, the details of which are as under : Sr.No. Name of the assessee Area covered in sale deed in square meter Amount of stamp duty payable assessed by the stamp duty author....
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.... the word 'assessable' which has already been reproduced at Para 7 of this order. 17. We find the Hon'ble Madras High Court in the case of R. Sugantha Ravindran (Supra) after considering the above circular has observed as under : "8. We have perused the above circular. It is stated therein that the scope of the provisions does not include transaction which are not registered with stamp duty valuation authority and executed through agreement to sell or power of attorney. Consequently, it is made clear therein that the amendments have been made applicable with effect from 01.10.2009 and therefore, they will apply only in relation to transaction undertaken on or after such date. The relevant portion of the circular is extracted hereunder: "23.4. Applicability:- These amendments have been made applicable with effect from 1st October, 2009 and will accordingly, apply in relation to transactions undertaken on or after such date." 9. Learned counsel for the Revenue is not disputing about the existence of such circular issued by the Board. If the Board has issued a circular clarifying the applicability of Section 50C in pursuance of the amendment made by Amendment Act 2 o....
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....nsactions namely the transfers of properties without or before registration. Before introducing the said amendment, only the transfers of properties where the value adopted or assessed by the stamp valuation authority were subjected to Section 50C application. However after introduction of the words "or assessable" after the words "adopted or assessed", such transfers where the value assessable by the stamp valuation authority are also brought into the ambit of Section 50C. Thus such introduction of new set of class of transfer would certainly have the prospective application only and not otherwise. Hence the assessee's transfer admittedly made earlier to such amendment cannot be brought under Section 50C. 11. Applying the above said decision of the Honourable Apex Court to the facts and circumstances of the case as well as by considering the scope of Section 50C, we hold that the Revenue is not entitled to canvass the correctness of the order passed by the Tribunal, more particularly in the light of the circular issued by the Board. Accordingly, the Tax Case Appeal is dismissed and the substantial question of law is answered against the Revenue. No costs." 18. From the a....
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....Revenue - recourse cannot be had to section 263(1). There can be no doubt that the provision cannot be invoked to correct each and every type of mistake or error committed by the AO; it is only when an order is erroneous that the section will be attracted. An incorrect assumption of facts or an incorrect application of law will satisfy the requirement of the order being erroneous." 22. The Hon'ble Bombay High Court in the case of CIT Vs. Gabriel India Ltd. reported in 203 ITR 108 has held as under (short notes) : "Revision - Scope - order sought to be revised must be erroneous and also by virtue of its being erroneous prejudice must have been caused to interests of the Revenue - Section 263 does not visualize substitution of judgment of Commissioner for that of ITO, unless the decision is held to be erroneous - Order is erroneous when it is not in accordance with law and is prejudicial when it has caused loss of revenue - There must be material before the Commissioner to satisfy him, prima-facie, that the two requisites are present - Power cannot be exercised at the whims and caprice of Commissioner." 23. In view of our above discussion and following the decisions cited (S....