TaxTMI 
TaxTMI 
2025 (8) TMI 580
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....d. AO noticed that during the AY under consideration, the assessee has sold immovable property along with two others. Further, on verification of the sale deeds executed by the assessee, the Ld. AO observed that the assessee is having 1/3rd of share only on the sale deed value as per the registered document ie. Rs. 4,15,00,000/- however, the value as per SRO, Dwarakanagar, Visakhapatnam on the transactions entered into with respect to the immovable property sold was at Rs. 20,28,64,000/-. Therefore, the Ld. AO observed that the provisions of section 50C applies to the difference amount of Rs. 16,13,64,000/- [Rs. 20,28,64,000 - Rs. 4,15,00,000]. The Ld. AO also observed that the total share of the assessee including the value as per the SRO records u/s. 50C for his share of 1/3rd share works out to Rs. 6,76,21,333/-. Accordingly, the Ld. AO issued a notice u/s. 148 of the Act on 03/11/2014 and served on the assessee on 04/11/2014. Since the assessee filed a letter submitting his changed residential address, the concerned jurisdictional Assessing Officer issued notice u/s. 142(1) of the Act and called for certain information. In response, the assessee's Authorized Representative appe....
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....operties as the full of the consideration for the purposes of section 48 even though there is not even an iota of evidence about the receipt of the consideration in excess of the amount mentioned in the sale deed also there is no evidence of any acquisition of assets or deposits in banks with respect to the huge amount (difference between the SRO value and the actual consideration of about Rs. 16 Crs). 3. The notice issued under section 148 dated 03/11/2014 issued by the ITO, Ward-1(1) is vague and therefore invalid. Consequently, the entire proceedings in pursuance of such an invalid notice are invalid including the assessment order passed. 4. The fair market value adopted by the AO as on 01/054/1981 is not correct instead the Ld. AO ought to have adopted the value as on 01/04/1981 by indexing the SRO value as on the date of transfer in the reverse. 5. The Ld. AO is not justified in giving credit for taxes paid before the completion of the assessment. 6. All the above grounds of appeal are mutually exclusive and without prejudice to one another. 7. The appellant craves leave to add to, alter, amend, modify or delete all or any of the ab....
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....uation of the property as per the rent capitalization method determined in accordance with the Schedule-3 of the Wealth Tax Act, 1957 which stood at Rs. 37,45,070/- as against the sale consideration received by the assessee and others aggregating to Rs. 4,15,00,000/-. We find merit in the argument of the Ld. AR that the similar valuation was adopted in the case of the adjacent property as demonstrated by the Ld. AR. A reference was made by the Ld. AR to the CBDT Circular which is available in page 55 of the paper book which states as follows: "(i).......... (ii).......... (iii)......... (iv) Cases where acquisition proceedings are in advance stage and the intention of the Government to acquire the property is indicated or in case where notice u/s. 10(1) & 10(3) of UL (C&R) Act, 1976 have been issued by the Government. Mere declaration of land surplus under Urban Land (Ceiling Regulation) Act, 1976 does not deprive the land lords from his rights, title and interest in the excess vacant land. Those will not be extinguished till the date of publication of notification under section 10(3) of UL (C&R) Act, 1976, to acquire the excess land for....
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....he moment this property is taken over by the Government, he will receive the compensation of Rs. 2 lakhs only. We are not oblivious of those categories of buyers who may buy "disputed properties" by taking risks with the hope that legal proceedings may ultimately be decided in favour of the assessee and in such a eventuality they are going to get much higher value. However, as stated above, hypothetical presumptions of such sales are to be discarded as we have to keep in mind the conduct of a reasonable person and "ordinary way" of the presumptuous sale. When such a presumed buyer is not going to offer more than Rs. 2 lakhs, obvious answer is that the estimated price which such asset would fetch if sold in the open market on the valuation date(s) would not be more than Rs. 2 lakhs. Having said so, one aspect needs to be pointed out, which was missed by the Commissioner (Appeals) and the Tribunal as well while deciding the case in favour of the assessee. The compensation of Rs. 2 lakhs is in respect of only the "excess land" which is covered by Sections 3 and 4 of the Ceiling Act. The total vacant land for the purpose of Wealth Tax Act is not only excess land but other part of the l....