TaxTMI 
TaxTMI 
2008 (2) TMI 412
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....y that search operation was undertaken on the residential premises of the assessee on March 4, 1997. Then in response to the notice issued under section 158BC, the assessee filed return of income for the block period, declaring undisclosed income of Rs. 17,96,620. The present controversy, however, relates only to the additions made by the Assessing Officer on account of undisclosed investment in the agricultural lands and plots. The Assessing Officer held the assessee to have purchased the agricultural lands and plots during the block period. Copies of agreements/registered deeds were seized and from scrutiny thereof, it was observed that the investment accounted for regarding purchase of these properties is less than the market value taken....
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....and has relied exclusively on the value taken by the Sub-Registrar, which cannot be considered sufficient rather independent evidence particularly for sustaining the addition in a block assessment was required. It was also found that the stamp duty rates are fixed by the DLC, according to the norms of the particular area, with the sole object to charge stamp duty and it does not necessarily reflect actual mark rate of the property. Thus, the value determined for the purpose of stamp duty alone, without any other evidence/document or paper cannot form as unexplained investment. Thus, the addition was deleted. 4. The Revenue went in appeal and in this regard, the learned Tribunal relying upon a judgment of the hon'ble Supreme Court in K. P. ....
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....erence of price debited in the accounts of books of the assessee and the value adopted by the registering authority for stamp duty purposes, while the actual price paid for purchase of the land is more, as is clearly borne out from the sale agreement and other incriminating documents seized during the course of search and seizure operation ?" 6. Arguing the appeal, learned counsel for the Revenue reiterated the stand, that the value determined by the authorities (DLC rates) do represent the fair market value and since, in the present case, the value shown in the document was a deflated figure and, therefore, the learned Assessing Officer was right in making addition of Rs. 10,84,835. 7. On the other hand, learned counsel for the assessee ....
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....me is to be made on the basis of the evidence found as a result of search, or requisition of books of account, or other documents, and such other material or information, as are available with the Assessing Officer, and relatable to such evidence. This provision does not include any fictional or presumptive income to be liable to or capable of being included in the aggregate of the undisclosed income. Obviously, therefore, the determination of value of the assets acquired, i.e., the fair market price at the time of purchase cannot be dependent on the norms/rates (DLC rates) as may be fixed by the concerned committees. There may be cases, where the assets may have been purchased at the price higher than the DLC rates and rather there may be ....
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....of section 48 but then sub-section (2) specifically provides that without prejudice to the provisions of sub-section (1), where the assessee claims before the Assessing Officer that the value adopted or assessed by the Stamp Valuation Authority exceeds the market value of the property as on the date of transfer, the Assessing Officer may refer the valuation of the capital asset to a Valuation Officer and the relevant provisions of the Wealth-tax Act, with necessary modifications have been provided to apply, subject further to the exception that where the Valuation Officer values the assets at a price higher than the value adopted by the Stamp Valuation Authority, such higher value shall be taken to be the consideration received or accrued a....
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....f fair market value of a capital asset is generally a matter of estimate based to some extent on guesswork and despite the utmost bona fides, the estimate of the fair market value is bound to vary from individual to individual." 13. Then it was further held that section 52(2) does not create any fictional receipt, it does not deem as receipt something, which in fact is not received. It was also held that it is not enough to attract the applicability of sub-section (2) that the fair market value of the capital asset transferred by the assessee as on the date of the transfer exceeds the full value of the consideration declared in respect of the transfer by not less than 15 per cent. of the value so declared but it is further more necessary t....