TaxTMI 
TaxTMI 
2010 (7) TMI 1090
X X X X Extracts X X X X
X X X X Extracts X X X X
....sessment in this case was completed under section 143(3) of the Income Tax Act, 1961(the Act) determining total income under the head long term capital gains of Rs. 2,35,17,376/-. Subsequently, the ld. CIT(A), MC- XXI in excerise of his powers under section 263 of the Act, vide his order dated 25.3.2003 set aside the assessment for being done denovo. Accordingly the AO issued notice under section 143(2) to the assessee. During the course of assessment proceedings the assessee was asked to explain as to why the valuation made by the departmental valuer at Rs. 11.33 lacs should not be adopted instead of value of Rs. 24,07,855/- determined by the registered valuer. In response the assessee filed his explanation giving sale instances of the nea....
X X X X Extracts X X X X
X X X X Extracts X X X X
....DVO could be made only where the AO is of the opinion that the value adopted by the assessee is less than its fair market value. In the case of the assessee as per registered valuer's report dated 26.1.1998 the valuation of the landed property is at Rs. 24,07,855/-, which is more than the value reported by the DVO of Rs. 11,33,000/-, therefore, the reference itself is bad in law and for the proposition the reliance was also placed on the following decisions. (1) Ms. Rubab M. Kazerani V/s. JCIT (91 ITD 429)(Mum) (2) Smt. Saraswatidevi Gehlot vs. ITO (111 TTJ 408) (Jd) (3) ITO vs. Smt. Lalitaben B. Kapadia (ITA No.8763/M/04 dt.20.9.07,ITAT "K" Bench) It was further contended that the report of the DVO has l....
X X X X Extracts X X X X
X X X X Extracts X X X X
....) erred in not appreciating the settled law that a reference to DVO u/s. 55A(a) could be made only where the value claimed by appellant's registered valuer is less than the fair market value (FMV) and accordingly DVO's valuation could not be adopted for determining the FMV as on 1/4/1981" 6. The ld. counsel for the assessee while reiterating the same submissions as submitted before the A.O and ld. CIT(A) further submits that in view of the provisions of section 55A(a) which states that in a case where value of the asset as claimed by the assessee is in accordance with the estimate made by a registered valuer, if the AO is of the opinion that the value so claimed is less than its fair market value, the AO may refer the valuation of capita....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... relying on the order of the A.O and Ld. CIT(A) submits that the decisions relied on by the ld. counsel for the assessee are distinguishable and hence not applicable to the facts of the present case. He further submits that if section 55A(a) is not applicable then 55A(b) is applicable to refer the matter to the DVO. He, therefore, submits that the order passed by the AO and confirmed by the ld. CIT(A) be upheld. 8. We have carefully considered the rival submissions of the parties and perused the material on record. Section 55A(a) reads as under:- "55A. With a view to ascertaining the fair market value of a capital asset for the purposes of this Chapter , the Assessing Officer may refer the valuation of capital asset to a V....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... "5. The first issue that arises for our consideration is whether the reference made by the Assessing Officer to the DVO u/s. 55A is bad in law under the facts and circumstances of the case. This issue, in our considered opinion, is covered in favour of the assessee and against the Revenue by the judgment in the case of Rubab M. Kazerani reported in 91 ITD 429 (Mum) (tm). Further the assessee also covered by the Third Member decision of the Pune Bench of the Tribunal, the case of Krishnabhai Tingore Vs. ITO reported in 101 ITD 317 (Pune) (TM) wherein it has been held that reference to DVO can only be made in cases where the value of capital asset shown by the assessee is less than its fair market value of land as on 1st April, 1981 s....