TaxTMI 
TaxTMI 
2026 (1) TMI 227
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....essment order passed under Section 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as "the Act") relating to the Assessment Year 2011-12. 2. The brief facts of the cases are that the assessee is an individual who has not filed the return of income for the A.Y. 2011-12. The assessee sold a residential property at Ahmedabad for a consideration of Rs. 180,00,000/- wherein assessee's share is 50%. The assessee has taken Registered Valuer certificate the value of the property as on 01.04.1981 in order to calculate the capital gain tax and found that below taxable limit hence, no original Return of Income was filed. However, in response to 148 notice the assessee filed Return of Income and the Assessing Officer has refer....
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....ground of appeal." 5. Ld. Counsel appearing for the assessee submitted that the Assessing Officer has no power to make a reference under Section 55A of the Act relevant to the A.Y. 2011-12 and relied upon Jurisdictional Bench of the Tribunal in the case of Shri Devendra Rasiklal Shah vs. DCIT in ITA No. 2027/Ahd/2015 vide order dated 01.06.2018. Further, in the case of the other co-owner namely assessee's brother Vijendra Kantilal Patel on similar additions made by the Department, Ld. CIT(A) deleted the addition by holding that the AO cannot make reference under Section 55A of the Act to determine the Fair Market Value of the property. Thus, the entire assessment made is liable to be deleted. 6. Per contra, Ld. Sr. DR appearing for th....
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....fair market value. Such clause, therefore, as it stood at the relevant time, had no application to the valuation as on 1.4.1981. We are conscious that with effect from 1.7.2012, the expression now used in clause (a) of section 55A is "is at variance with its fair market value". The situation may, therefore, be different after 1.7.2012. We are, however, concerned with the period prior thereto. Clause (b) of section 55A is in two parts and permits a reference to DVO if the Assessing Officer is of the opinion that (i) the fair market value of the asset exceeds the value of the asset so claimed by the assessee by more than such percentage of the value of the asset so claimed or by more than such amount as may be prescribed in this behalf; or (i....
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....er case, as provided under clause(b) of Sec. 55A of the Act, the Assessing Officer has to record an opinion that (i) the fair market value of the asset exceeds the value of the asset as claimed by the assessee by more than such percentage or by more than such an amount as may be prescribed; or (ii) having regard to the nature of the asset and other relevant circumstances, it is necessary to make such a reference." 17. In the result, we see no reason to interfere. However, we have given our independent reasons and should not be seen to have confirmed the reasonings adopted by the Tribunal in the impugned judgment. Tax Appeal is dismissed. 11. The Hon'ble High Court has specifically held that prior to the amendment in sectio....
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....e value so claimed is less than its fair market value". The words - is less than its fair market value came to be substituted by Finance Act, 2012 by the words - is at the variance with its fair market value. As per the above provisions of Section 55A of the IT Act, the AO can refer this property for valuation only if in the opinion of the AO, value of the asset arrived at by the Registered Valuer is less the fair market price. In the case of Gaurangiben S Shodhan (2014) 45 Taxman.com 356 the jurisdictional Gujarat High Court held that prior to the amendment in section 55A with effect from 1.7.2012 in a case, the value of the asset claimed by the assessee is in accordance with the estimate made by the Registered Valuer, if the Assessing Off....
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....y competent to make reference to the DVO. As explained above the amended provision of Sec. 55A is not applicable to all those documents which got registered before 01.07.2012. In this case the sale deed was registered on 10.04.2010. Apparently, the AO has misinterpreted the provision and erroneously applied it retrospectively. With effect from July 1, 2012, the expression now used in clause (a) of Section 55A is 'at variance' the situation may, therefore, be different after July 1, 2012 which is applicable for assessment year 2013-14 whereas the assessee's case under consideration relates to assessment year 2011-12. Hence amended provisions are not applicable to the appellant. So the LTCG calculated by the appellant shall be ado....