TaxTMI 
TaxTMI 
2019 (3) TMI 987
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....ideration of Rs. 5,18,23,000/- by means of a registered sale deed dated 30.10.2007. Out of the sale consideration, according to the Ld. counsel, the assessee in I.T.A. No.1931/Chny/2016 received Rs. 2,25,00,086/- towards his share. The assessee in I.T.A. No.1970/Chny/2016 received Rs. 20,00,000/-. The balance amount of Rs. 48,22,828/- was paid by the seller in favour of M/s REPCO Bank, Pondicherry towards settlement of the outstanding loan amount. According to the Ld. counsel, the assessee admitted capital gain of Rs. 49,03,255/- in the return of income. For the purpose of computation of capital gain, according to the Ld. counsel, the assessees have taken fair market value as on 01.04.1981 at Rs. 100/- per sq.ft. However, the Assessing Officer has taken the value at Rs. 1.38 per sq.ft. Referring to the valuation report obtained by the Revenue in the case of Shri Ramadoss, one of the co-owners, copy of which is available at page 1 of the paper-book, the Ld.counsel submitted that the Departmental Valuation Officer fixed the value at Rs. 39.66 per sq.ft. This is an average valuation fixed by the Departmental Valuation Officer. According to the Ld. counsel, the Departmental Valuation O....
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....that market value is not a constant figure. It would fluctuate depending upon various factors such as the area of the land, location of land, availability of infrastructure facilities around the land, potential for future development, access to the infrastructure facilities to the land, etc. The Assessing Officer without considering any of these factors, has simply adopted the guideline value of the Registration authority. 6. From the Departmental Valuation Officer's report in the case of one of the co-owners, it appears that the property is located in prime location of Cuddalore. The property appears to have been located on the eastern side of link road to railway over bridge and Cuddalore main bus stand. The Departmental Valuation Officer has also noted that it is located on the rear side of busy Lawrence Road and even in the year 1981, the Departmental Valuation Officer found that there was high potential for development of property as commercial campus / cinema theatres / Kalyana Mandapam, etc. The frontage of the building is admittedly 178 ft. By considering the nature of building, future development and potential for establishing commercial campus / cinema theatres, this T....
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.... additional construction as claimed by the assessees or it is improvement of existing building as claimed by the valuation officer. In those factual situation, this Tribunal is of the considered opinion that the matter needs to be reconsidered by the Assessing Officer. Accordingly, the orders of both the authorities below are set aside and the issue of claim of exemption under Section 54F of the Act is remitted back to the file of the Assessing Officer. The Assessing Officer shall re-examine the matter and find out the nature of work that was carried on by the assessees by spending the capital gain and thereafter decide the issue afresh in accordance with law, after giving a reasonable opportunity to the assessees. 10. The next issue arises for consideration is disallowance of loan availed from REPCO Bank and interest paid thereof. 11. Shri S. Sridhar, the Ld.counsel for the assessees, submitted that the assessees claimed before the Assessing Officer repayment of loan and interest to the extent of Rs. 48,22,828/-. According to the Ld. counsel, the assessees borrowed the loan from REPCO Bank by mortgaging the property. Therefore, according to the Ld. counsel, unless the assess....
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....as handed over to the power of attorney agent for negotiating the sale and it was not handed over to the purchaser. Moreover, according to the Ld. counsel, no consideration was received from power of attorney agent also, therefore, there was no sale during the year under consideration. According to the Ld. counsel, execution of power of attorney in favour of third party for negotiating the sale cannot be considered to be sale of property within the meaning of Section 2(14) of the Act. 16. We heard Ms. M. Subashree, the Ld. D.R. also. According to the Ld. D.R., the assessees have not produced any evidence to show that the possession of the property was handed over and sale proceeds were received on the date of sale. Therefore, according to the Ld. D.R., the presumption is that the property was sold on the date on which the power of attorney was executed. 17. We have considered the rival submissions on either side and perused the relevant material available on record. Power of attorney agent is only to manage or negotiating the property for sale. The power of attorney executed by the assessees does not confer or transfer any right over the property on any person. At the best, t....