TaxTMI 
TaxTMI 
2020 (11) TMI 49
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....nts in respect of agricultural land for which assessee claimed exemption and also provide relevant documents which substantiate that assessee is owner of the land over which have clear title over the agricultural land. In response, the assessee has furnished copy of the sale deed and copy of the valuation report from Shri D.R. Sharma and Associates along with proof of agricultural land. On going through the submissions of the assessee and from the sale deed, A.O. observed that the socalled agricultural land was having the specification i.e., foundation as cement concrete, super structure has load bearing wall, walls are of stone and brick masonry in cement, cement flooring and RCC slab roof. A.O, therefore, issued show cause notice to the assessee based on valuation report and sale deed and above specifications in the property under consideration that built-up area of Ground Floor is 675.00sq. metres. Therefore, it is clear that the land aforementioned is not an agricultural land. It is much built-up residential property. Therefore, show caused the assessee why the exempt income of Rs. 65 lakhs as claimed by assessee may not be disallowed and added to the income on account of long ....
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....tal gains. 3.3. The A.O. on perusal of the sale deed found that Circle Rate of the property is Rs. 1,87,76,000/- and sale consideration have been shown at Rs. 65 lakhs only which is less than the Circle Rate of the property. A show cause notice was issued to the assessee that Section 50C of the I.T. Act applies in this case, therefore, difference amount of Rs. 1,22,76,000/- should be added to the income of the assessee. The assessee in reply to the show cause notice filed reply which is reproduced in the assessment order in which the assessee again reiterated the fact that the property in question is agricultural land and as such Section 50C would not apply. In alternate contention, it was also contended that if the value of Rs. 1,87,76,000/- is considered for stamp valuation and treated as sale consideration, capital gain on sale of agricultural land will result in capital loss of Rs. 37,41,230/- by giving benefit of indexed cost. The A.O. however, did not accept the contention of assessee because subject land is not agricultural land, but, is a well built-up residential property. Therefore, difference amount of Rs. 1,22,76,000/- [Rs. 1,87,76,000/- (-) Rs. 65,00,000/-] was a....
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.... by giving benefit of indexation and no addition could be made against the assessee. The valuation report of the Registered Valuer was filed which is not appreciated by the authorities below. He has further submitted that A.O. has not made any reference to the Valuation Officer under section 50C of the I.T. Act. He has relied upon the Order of the ITAT in the case of ITO vs., Aditya Narain Verma (HUF) [2017] 57 ITR (T) 449 (Delhi- Tribu.) and Order of ITAT, Chandigarh Bench in the case of Shri Barjinder Singh Bhatti, Chandigarh vs., ITO, Ward- 4(1), Chandigarh in ITA.No.1101/CHD/2014, Dated 15.07.2015 and Order of ITAT, Delhi E-Bench, Delhi in the case of ACIT, Circle-45(1), New Delhi vs., M/s. Modern Lace House, New Delhi, in ITA.No.1032/Del./2015 Dated 28.05.2018, in which assessments were quashed because reference to DVO was not made. Without prejudice to the above submissions, Learned Counsel for the Assessee submitted that assessee filed report of the Registered Valuer to the stamp duty, therefore, it can be said that assessee did object to the same valuation and relied upon decision of the Calcutta High Court in the case of Shri Sunil Kumar Agarwal vs., CIT, Siliguri [2015] 3....
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....mutated in the name of father of assessee after purchasing the same. These facts clearly show that assessee never disclosed that property in question is agricultural land. Assessee never produced the Purchase Deed of the property in question of father of the assessee and assessee never produced any evidence if father of the assessee has invested in cost of construction from his own source. Therefore, none of the above additional evidences are relevant to the matter in issue and would not prove the case of the assessee in any manner with reference to the matter in issue for calculation of the capital gain. None of these additional evidences goes to the root of the matter. Therefore, we are not inclined to admit these additional evidences for the purpose of disposal of the appeal. Application for admission of additional evidences is accordingly rejected. 8. The first issue is with regard to computation of capital gain on which A.O. made addition of Rs. 64,24,710/-. The A.O. found that assessee has received sale consideration of Rs. 65 lakhs on sale of the property in question. The assessee claimed it to be an agricultural land. Assessee filed valuation report of Shri D.R.....
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....efore the A.O. The assessee has not produced copy of the Purchase Deed of the property in question by father of the assessee despite it was a registered document. Therefore, cost of acquisition of asset is not proved by assessee. Further, no evidence have been produced by assessee to prove cost of the improvement in the property either by the assessee or by her father. Therefore, no benefit under section 48 of the I.T. Act, 1961, could be given to the assessee. Therefore, claim of assessee that assessee suffered capital loss on sale of the property in question cannot be accepted in any manner. Therefore, A.O. has rightly computed the capital gain on sale of transfer of capital asset in a sum of Rs. 64,24,710/-. 9. As regards the addition made under section 50C of the I.T. Act, 1961, it is an admitted fact that in the Sale Deed valuation of the property for stamp duty purposes have been mentioned at Rs. 1,87,76,000/-. However, the property have been sold for a consideration of Rs. 65 lakhs only. Section 50C(1) of the I.T. Act provides as under : "50C (1) Where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being l....
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....order to determine the fair market value of the property. Further when show cause notice was given to the assessee under section 50C of the I.T. Act, 1961, for the purpose of making the addition of Rs. 1,22,76,000/-, assessee merely contended before A.O. that since property in question is an agricultural land, therefore, Section 50C of the I.T. Act, is not applicable. The assessee also merely contended that since assessee suffered capital loss, therefore, capital loss shall have to be computed. Thus, assessee never objected to the valuation done by the Stamp Valuation Authority of the State Government while registering the Sale Deed in question. Learned Counsel for the Assessee now contended that since report of the Registered Valuer was filed before A.O, therefore, it may be treated as assessee has objected to the stamp valuation. We have already noted several discrepancies in the report of the Registered Valuer with regard to year of construction in the property and basis of the Registered Valuer to report cost of the construction and year of construction and the basis thereof, because the assessee never produced Purchase Deed of the property before the authorities below or be....