PANNALAL HIRALAL BACHKANIWALA (HUF), SURAT V. ITO, WARD-3(2)(2)Q, SURAT

ITA 101/SRT/2020

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 1859 (ITAT-SURAT)
• Duration Of Justice: 2 year(s) 1 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2022
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 03-05-2022
• Assessment Year: 2014-2015
• Appeal Filed On: 01-06-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Value adopted by valuation officer; Rectification of order; Cost of acquisition; Fair market value; Valuation report
• Section: 154; 143(3); 54B; 143(1); 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, SURAT BENCH, SURAT BEFORE SHRI PAWAN SINGH, JM & DR. A. L. SAINI, AM आयकरअपीलसं./ITA No.101/SRT/2020 (Ǔनधा[रणवष[ / Assessment Year: (2014-15) (Virtual Court Hearing) Pannalal Hiralal Bachkaniwala (HUF), A. K. Road, Hiralal Colony, Himson Mills, Surat-395007. Vs. The ITO, Ward-3(2)(2), Surat. èथायीलेखासं./जीआइआरसं./PAN/GIR No.: AACHP3897A (Appellant) (Respondent) Assessee by Shri Umesh Dalal, AR Respondent by Shri J. K. Chandani, Sr. DR Date of Hearing 04/05/2022 Date of Pronouncement 19/07/2022 आदेश / ORDER PER DR. A. L. SAINI, AM: Captioned appeal filed by assessee, pertaining to the Assessment Year (AY) 2014-15 is directed against the order passed by the Learned Commissioner of Income Tax (Appeals)-3, Surat (in short “ld. CIT(A)”], in Appeal No. CIT(A)-3/10625/2016-17, which in turn arises out of an assessment order passed by Assessing Officer under section 143(3) of the Income Tax Act, 1961 (hereinafter referred to as “the Act”), dated 29.12.2016. 2. The grounds of appeal raised by the assessee are as under: “A. Registered valuer report not accepted (Section 55A) 1. On the facts and in the circumstances of the case, the learned CIT (A's) erred in not considering registered valuer's report @Rs.60 per. Sq.mtr. 2. On the facts and in the circumstances of the case, the learned CIT (A's) erred in not appreciating that registered valuer has made comparable instances before making valuation as on 01.04.1981. B. Accepting DVO Report without giving any justification 1. On the facts and in the circumstances of the case, the learned CIT (A's) has erred in accepting DVO report for taking value of Rs.53/- without assigning any reason for not accepting registered valuer report. 101/SRT/2020/AY.2014-15 Pannalal H. bachkaniwala Page | 2 2. On the facts and in the circumstances of the case, the learned CIT (A's) erred in not considering the written submission made from time to time.” 3. Succinct facts are that assessee before us is a Hindu Undivided Family and filed his return of income on 04.09.2014 declaring total income of Rs.3,83,37,150/- for AY.2014-15. The return of income was processed under section 143(1) of the Act. However, later on, the assessee`s case was selected for scrutiny through CASS and notice under section 143(2) of the Act was issued on 04.09.2015, which was duly served upon the assessee on 24.09.2015. During the course of assessment proceedings, on verification of the case records and details filed by the assessee, it was observed by the assessing officer that during the period under consideration, assessee had sold agriculture land at Moje Ladvi, RS No.95 and 91 for a sale consideration of Rs.9,06,47,656/-. During the assessment proceedings, the assessee was asked to furnish the working of the capital gain arising out the sale of this property. The assessee has submitted the working of the capital gain and has claimed cost of acquisition of both the property @ Rs.60 per Sq.Meter on total land area of 54938 Sq. Meter at Rs.32,96,280/- on the basis of the Valuation Report of Valuer. The AO noted that indexed cost of acquisition of the property worked out to Rs.3,09,52,069/- was appeared to be on the higher side. As no relevant documentary evidences except Valuation Report were available, therefore a reference was made to Valuation Officer, Surat to determine the value of both the property as on 01.04.1981. However, assessing officer did not receive the valuation Report. Therefore, assessing officer by taking of value Rs. 10/- per sq.meter, as fair market value as on 01.04.1981 worked out the cost of indexation at Rs. 51,58,678/- against the indexed cost of acquisition of the property worked out to Rs.3,09,52,069/- by assessee. After allowing exemption under section 54B and 54EC of the Act, the assessing officer determined long term capital gain to the tune of Rs.3,02,93,391/-. 4. On appeal, ld CIT(A) observed that after getting valuation report from the DVO, the assessing officer passed the rectification order under section 154 of the Act, and the addition was reduced to Rs.36,08,390/- by the AO by passing 101/SRT/2020/AY.2014-15 Pannalal H. bachkaniwala Page | 3 rectification u/s 154 of the Act by order dated 10.08.2017. The Valuation Report is received from the Department Valuer who has taken the FMV at Rs. 53 per Sq. meter. Therefore, ld CIT(A) directed the AO to take the FMV as on 01.04.1981 at the rate of Rs.53 as determined by the DVO and calculate the capital gain accordingly. Aggrieved, by the order of ld CIT(A), the assessee is in further appeal before us. 5. Learned Counsel for the assessee argued that solitary grievance of the assessee is that Registered Valuer has valued the property at Rs.60 per sq. meter. Therefore, the same should be adopted to determine the fair market value as on 01.04.1981, as against the fair market value (FMV) at the rate of Rs.53 per sq. meter adopted by DVO. The Ld. Counsel submitted valuation report of the Registered Valuer before the Bench and relied on the judgment of the Dashrathbhai G. Pate Vs. DCIT (vide paper book page no.65) (2020) 182 ITD 327 and contended that the assessee`s Registered Valuer report should not be rejected and therefore value adopted by the Registered Valuer @ Rs.60 per sq.Meter may be adopted to determine the fair market value on 01.04.1981. 6. On the other hand, the Ld. DR for the Revenue has primarily reiterated the stand taken by the Assessing Officer, which we have already noted in our earlier para and is not being repeated for the sake of brevity. 7. We have heard both the parties and carefully gone through the submissions put forth on behalf of the assessee along with the documents furnished and the case laws relied upon, and perused the facts of the case including the findings of the ld. CIT(A) and other material brought on record. We note that main dispute between the Assessee and Revenue is that assessee wants that his Registered Valuer report, wherein he valued @ Rs.60 per sq.Meter may be adopted to determine the fair market value on 01.04.1981 and Revenue wants that fair market value (FMV) at the rate of Rs.53 per sq. meter, as determined by the DVO should be considered. The difference is Rs.7/- (Rs.60 per sq.Meter- Rs.53 per sq. meter). We note that the Valuation Report received 101/SRT/2020/AY.2014-15 Pannalal H. bachkaniwala Page | 4 from the Department Valuer, wherein he has taken the FMV at Rs. 53 per Sq. meter, appears quite reasonable. We note that there is no day and night difference between assessee`s Valuer`s report and Department Valuer`s report hence assessee does not deserve further relief, therefore, we are of the view that the order of CIT(A) is just and proper and calls for no interference. 8. In the result, appeal filed by the assessee is dismissed. Order is pronounced in the open court on 19/07/2022 by placing the result on the Notice Board as per Rule 34(5) of the Income Tax (Appellate Tribunal) Rule 1963. Sd/- Sd/- (PAWAN SINGH) (Dr. A.L. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER Surat Ǒदनांक/ Date: 19/07/2022 SAMANTA Copy of the Order forwarded to 1. The Assessee 2. The Respondent 3. The CIT(A) 4. CIT 5. DR/AR, ITAT, Surat 6. Guard File By Order // TRUE COPY // Assistant Registrar/Sr. PS/PS ITAT, Surat