Asst..CIT, Circle -6(1), Hyderabad V. Shri Ashwin Joshi, Hyderabad

ITA 1428/HYD/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 2847 (ITAT-HYDERABAD)
• Duration Of Justice: 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2013
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 17-09-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: K J RAO
• Keywords: Sale consideration of property below Jantri Value; Value adopted by valuation officer; Question of law; Cost of acquisition; Fair market value; Valuation report
• Section: 50C

Judgement Text

1 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO.1428/HYD/2012 ASSESSMENT YEAR 2009-2010 THE ACIT, CIRCLE 6(1) HYDERABAD. VS. SHRI ASHWIN JOSHI HYDERABAD PAN AGXPJ6884E (APPELLANT) (RESPONDENT) ITA NO.1269/HYD/2012 ASSESSMENT YEAR 2009-2010 SHRI ASHWIN JOSHI HYDERABAD PAN AGXPJ6884E VS. THE ACIT, CIRCLE 6(1) HYDERABAD. (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI K.J. RAO, (D.R.) FOR ASSESSEE : SHRI K.C.DEVDAS, (A.R.) DATE OF HEARING : 25.06.2013 DATE OF PRONOUNCEMENT : 31.07.2013 ORDER PER SMT. ASHA VIJAYARAGHAVAN, J.M. BOTH ARE CROSS APPEALS FILED BY THE REVENUE AND AS SESSEE AGAINST THE ORDER OF THE CIT(A)-IV, HYDERABAD DATED 29.06.2012 FOR THE A.Y. 2009-2010. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE APPELLANT IS AN INDIVIDUAL AND FILED ITS RETURN OF INCOME FOR THE A SSESSMENT YEAR 2009-10 DECLARING A TOTAL INCOME OF RS.6174193 4/- UNDER THE HEAD INCOME FROM LONG TERM CAPITAL GAINS 2 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI ARISING ON TRANSFER OF PROPERTY BEARING MCH NO. 8-2-401/3, BANJARA HILLS, HYDERABAD, AP. THE ASSESSING OFFICER COMPLETED THE ASSESSMENT U/ S.143(3) OF THE INCOME TAX ACT, 1961 DETERMINING LONG TERM CAPITAL GAINS AT RS.84056784/ - AS AGAINST RETURNED FIGURE OF RS.617 41934/ -. THE ENHANCEMENT IN COMPUTATION OF INCOME FROM LONG TERM CAPITAL GAINS IS ON ACCOUNT OF DIFFERENCE IN ESTIMATION OF FAIR MARKET VALUE AS ON 01/04/1981. THE APPELLANT SOLD H IS HOUSE ADMEASURING 2386.03 SQ.YDS. WITH A BUILT UP AREA FOR VALUABLE CONSIDERATION OF RS.66000000/-. THE FAIR M ARKET VALUE AS PER SUB REGISTRAR OFFICE OF RS.85141350/ - WAS SUBSTITUTED AS DEEMED SALES CONSIDERATION BY VIRTUE OF SECTION 50C OF THE INCOME TAX ACT, 1961. AGAINST TH E SALE OF THE ABOVE PROPERTY THE APPELLANT ADOPTED FAIR MARKET VALUE AS ON 01/04/1981 AT RS.1600/- PER SQ. YD FOR LAND AND RS.1520/- PER SQ. MT FOR BUILT UP AREA WHICH WAS BA SED UPON THE VALUATION REPORT DATED : 29 TH APRIL, 2009 ISSUED BY THE APPROVED VALUER SHRI R.MUTHU KRISHNAN. THE ASSESSIN G OFFICER ADOPTED THE RATES AS PER SUB REGISTRAR OFFI CE @RS.20/ - PER SQ YDS FOR LAND AND @RS 50/ -PER SQ FT FOR BU ILT UP AREA BY IGNORING THE VALUATION REPORT FILED BEFORE HIM. 3. ON APPEAL, IT WAS SUBMITTED BEFORE THE CIT(A) TH AT T HE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 6(1) I GNORED THE DECISIONS OF THE JURISDICTIONAL BENCHES OF THE HON'BLE INCOME TAX TRIBUNAL, WHICH HAVE CONSISTENTLY HELD T HAT THE VALUE MENTIONED IN THE BASIC VALUE REGISTER OF SUB REGISTRAR CANNOT BE TREATED AS COMPARABLE VALUES OF MARKET VA LUE. IT WAS FURTHER SUBMITTED THAT THE ASSISTANT COMMISSION ER OF INCOME TAX HAS FURTHER IGNORED THE VALUATION CERTIFICATE 3 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI ISSUED BY THE REGISTERED VALUER AND THE OTHER INSTA NCES OF ORDERS WHEREIN THE FAIR MARKET VALUE WAS ESTIMATED MUCH HIGHER THAN THE RATES INDICATED BY THE RECORDS OF THE SUB REGISTRAR. 4. DURING THE COURSE OF APPELLATE PROCEEDINGS BEFOR E CIT(A), THE LEARNED REPRESENTATIVE OF THE ASSESSEE FURTHER SUBMITTED THAT THE ASSESSING OFFICER IGNORED THE DECISIONS OF THE HONBLE JURISDICTIONAL ITAT WHO HAVE CONSISTENTLY HELD THAT THE VALUE MENTIONED IN THE BASIC VALUE REGISTER OF THE SUB RE GISTRAR CANNOT BE TREATED AS COMPARABLE VALUE OF MARKET VALUE. HE AVERRED THAT THE ASSESSING OFFICER ALSO IGNORED THE VALUATION CE RTIFICATE ISSUED BY THE REGISTERED VALUER AND THE OTHER INSTANCES OF THE ORDERS WHEREIN FAIR MARKET VALUE WAS ESTIMATED MUCH HIGHER THAN THE RATES INDICATED BY THE RECORDS OF THE SUB REGISTRAR . 5. THE ASSESSEE SUBMITTED BEFORE THE CIT(A) THAT IN THE CASE OF O.V RAMANA REDDY HUF YOUR GOOD SELF IN ITA.NO.31 5 ORDER DATED : 29 /07/2011 DIRECTED THE ADOPTION OF RATE @RS.900/- PER SQ. YD AS ON 01/04/1981 IN RESPECT OF PROPERTY SITUATED AT ROAD NO.14, BANJARA HILLS, HYD ERABAD AS AGAINST THE VALUER'S REPORT OF RS.1000/- PER SQ YD. COPY OF THE ORDER PLACED AT PAGES 28 TO 43. THE APPELLAN T'S PROPERTY IS SITUATED AT ROAD NO.5, BANJARA HILLS, H YDERABAD IN A MORE ADVANTAGEOUS LOCATION AND THEREFORE THE VALUATION AT RS.1600/- IS REASONABLE. THE CASE OF T HE ASSESSEE CAN ALSO BE COMPARED WITH WASIM HASAN LATI F VS. ITO, WARD 7 (1) (PAGE NOS. 44 TO 54) WHEREIN THE COMMISSIONER OF INCOME TAX (APPEALS-VI) HAS IN ORDE R ITA NO.0245 UPHELD THE RATE OF RS.1250 PER SQ YD FOR LA ND SITUATED AT MASAB TANK X ROADS, HYDERABAD BEARING M CH 4 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI NO.10-5-2/1/ A, 10-5-2/1/6 TO 10 & 10-5-2/1/14 TO 16. IN THIS CASE, AN AGREEMENT OF SALE DT : 29/01/1980 ENT ERED INTO BY AND BETWEEN SAFIA SULTANA BEGUM W/O. MAJOR SYED NOORUL AHMED, RESIDENT OF 18-8-890, DABEERPURA, HYDERABAD THE 'VENDOR' AND MAJOR SYED MISABAUDDIN , SON OF SYED GHOUSE MOHINUDDIN, RESIDENT OF H.NO.L0-3-27 4/3A, HUMAYUN NAGAR, HYDERABAD, HEREAFTER THE 'VENDEE' WHEREIN A LAND IN SY.NO.27(A), MASAB TANK JUNCTION, HYDERABAD PURCHASED BY THE VENDOR THROUGH DOCUMENT REGISTERED AS NO.626, VOLUME 3, BOOK-I, PAGE 31 DAT ED 16/06/1958 BEARING MCH NO.10-5-2/1/2/A WAS SOLD AT THE RATE OF RS.1250/- PER SQ YD WAS FILED BEFORE THE LE ARNED COMMISSIONER OF INCOME TAX. THE ORDER OF THE CIT HA S BEEN CONFIRMED BY THE ITAT. 6. IT WAS ALSO SUBMITTED THAT IN ITS LATEST DECISIO N, THE HON'BLE JURISDICTIONAL INCOME TAX APPELLATE TRIBUNA L, HYDERABAD, IN THE CASE OF ASHVEN DATLA VS ITO WARD 12(1), HYDERABAD COPY OF THE ORDER PLACED AT PAGE 66 TO 73 OF THE PAPER BOOK, UPHELD THE RATE AT RS.750/- ADOPTED BY THE APPELLANT AS AGAINST RS.8 INDICATED IN THE SUB-REGI STRAR BASIC REGISTERS. THE INCOME TAX APPELLATE TRIBUNAL CONSIDERED THE VALUATION REPORT FURNISHED BY THE AS SESSEE IN SUPPORT OF THE VALUE ADOPTED BY ASSESEE. THE LAN D IN QUESTION IN THE SAID CASE IS AT HYDERNAGAR VILLAGE NEAR KUKATPALLY. 7. IT WAS FURTHER SUBMITTED THAT T HE LAND OF THE ASSESSEE IS AT BANJARA HILLS, HYDERABAD AND IS VERY NEAR FROM T AJ BANJARA THE 2 STAR HOTEL EXISTING EVEN BEFORE 1981. THE PHOTOGRAPH OF THE BUILDING FILED ALONG WITH THE WRI TTEN 5 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI SUBMISSIONS INDICATES THE PROMINENCE OF THE AREA EV EN IN THE YEAR 1981. THE LAND IS LESS THAN A KM AWAY FROM PUNJAGUTTA CIRCLE THE CENTRAL POINT AND THE COMMERC IAL HUB EVEN IN 1981. FINALLY, CONSIDERING ALL THESE ADVANT AGEOUS POINTS THE REGISTERED VALUER IN HIS REPORT ESTIMATE D THE VALUES AT RS.1600 PER SQ. YD. THIS REPORT PLACED AT PAGES 104 TO 114 WAS FILED BEFORE ASSESSING OFFICER AND T HE VALUE SUGGESTED THERE IN SUPPORTS THE ASSESSEES CASE. TH E LOCATION OF THE ASSESSEE LAND IS NOT FAR AWAY, FROM THE LAND DISCUSSED IN THE CASE OF WASIF HASSAN LATIF WHERE T HE FAIR MARKET VALUE WAS FINALLY DETERMINED AT RS.1250 PER SQ.YD. 8. IT WAS POINTED OUT BY THE LEARNED A.R. AS FOLLOW S : THE HON'BLE COMMISSIONER OF INCOME TAX (A)-II IN HI S ORDER IN THE CASE OF T.NANDAOGOPAL (PAGE 74 TO 79 O F PAPER BOOK) DIRECTED THE ASSESSING OFFICER TO ADOPT RS.900 PER SQ. YDS AS FAIR MARKET VALUE AS ON 01/04/1981 WHICH THE DEPARTMENT DID NOT FIND OBJECTIONABLE. THE SECOND APPEAL WAS NOT FILED BY T HE DEPARTMENT. IN THIS CASE THE HON'BLE COMMISSIONER O F INCOME TAX CONSIDERED THE ISSUE OF ABSENCE OF ANY COMPARABLE CASES IN THE SAME LOCALITY. STILL, HE EVALUATED THE POTENTIALITY OF THE AREA AND FIXED TH E RATE AT RS.900 PER SQ YD AS AGAINST RS.150/- INDICA TED BY THE SUB REGISTRAR AND RS.750/- ADOPTED BY THE ASSESSING OFFICER. 9. FURTHER THE EVIDENCES FILED AT PAGES 86 & 87 OF THE PAPER BOOK INDICATE THAT EVEN THOUGH THE SUB REGIST RAR VALUE IS RS.30/ - PER SQ .YDS THE STATE BANK OF HYDERABAD VALUED THE PROPERTY AT RS.2500/ - PER SQ YQS. TAKEN AS 6 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI COLLATERAL SECURITY. THIS SHOWS THAT THE FAIR MARKE T VALUE IS INVARIABLY HIGHER THAN THE BASIC REGISTER RATES PRO VIDE BY SUB REGISTRAR, DURING THE PERIOD 1976 TO 1984. 10. THUS A PREMIERE BANKING INSTITUTION LIKE SBH WHILE TAKING THE PROPERTY AS COLLATERAL SECURITY FOR GRAN TING FINANCIAL ASSISTANCE VALUED THE LAND @ RS.2500 PER SQ. YD. THUS THIS VALUATION WAS TO SECURE THE BANK AGAINST THE FINANCIAL ASSISTANCE GRANTED. THUS THE VALUE SHOWN BE ADOPTED AT RS.2500/- PER SQ YDS AS SBH WOULD HAVE D ONE ITS DUE DILIGENCE ON THE SUBJECT. HOWEVER, THE ASS ESSEES VALUER ADOPTED THE VALUE AT RS.1600/ - PER SQ YD ON A VALUATION REPORT. 11. ANOTHER FACT WHICH HAS BEEN SUBMITTED IS THAT T HE GOVERNMENT HAS FIXED THE GUIDELINE. VALUES IN 1976 AND WERE NOT REVISED TILL 1995. THIS FACT WAS CONSIDERE D BY THE INCOME TAX APPELLATE TRIBUNAL IN THE CASE OF ASHVEN DATLA (PAGE 66 TO 73 OF PAPER BOOK) AND IN FACT THE INCOM E TAX APPELLATE TRIBUNAL CONSISTENTLY CONSIDERED THIS ISS UE IN SEVERAL CASES. THE OBSERVATIONS OF INCOME TAX APPEL LATE TRIBUNAL ARE AS UNDER : 'IN VIEW OF THE ABOVE OBSERVATION OF THE TRIBUNAL IT IS OBVIOUS THAT THE STATE GOVERNMENT FIXED THE GUIDELINE VALUE IN THE YEAR 1976 AND IT WAS NOT REVISED TILL 1995. MOREOVER, AS OBSERVED BY THE CO-ORDINATE BENCH OF THIS TRIBUNAL, THE GUIDELINE VALUE/BASIC REGISTER WAS NOT PREPARED SCIENTIFICALLY' 12. THE PROGRESSIVE VALUATION RATES BETWEEN THE PER IOD 1981 AND 1997 WAS WELL APPRECIATED BY THE COMMISSIO NER OF INCOME TAX (A)-VI IN HIS ORDER IN THE CASE OF WASIF HASSAN 7 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI LATIF (PAGE 44 TO 54 OF THE PAPER BOOK). THE BASIC VALUE REGISTERED RATE REMAINED STATIC FROM 1976 TO 1984, AND THEREAFTER THE RATES WERE REVISED TO ACTUALITIES. IT WAS SUBMITTED THAT THIS ISSUE HAS BEEN APPRECIATED BY T HE CIT(A-VI) IN HIS ORDER IN THE CASE OF SRI NARENDRAN ATH IN ITA.NO.587/01-02, WHEREIN THE INCREASE IN RATES HAD BEEN NOTED AS UNDER : YEAR RATE PER SQ YARD IN RUPEES 1981 RS.100 1984 RS.1000 1987 RS.1500 1994 RS.4000 1997 RS.10000 , 13. THE ASSESSEES A.R. ALSO SUBMITTED THAT THE ABO VE SHOWED THAT IN A PERIOD OF 15 YEARS, ACCORDING TO S RO, THE VALUE HAD GONE UP BY 140 TIMES. IT WAS SUBMITTED TH AT THE, ABOVE ORDER OF THE CIT(A)-VI WAS UPHELD BY THE HON' BLE ITAT, HYDERABAD. 14. AFTER ELABORATE DISCUSSIONS, FINALLY, THE CIT(A ) DIRECTED THE ASSESSING OFFICER TO RECOMPUTE THE LONG TERM CA PITAL GAINS BY ADOPTING THE FAIR MARKET VALUE OF THE LAND AT RS.900/- PER SQ. YARD AND THAT OF THE BUILT-UP AREA AT RS.100/- PER SQ. YARD AND MODIFIED THE COMPUTATION OF INCOME OF THE ASSESSEE FOR THE YEAR UNDER CONSIDERA TION ACCORDINGLY. AGGRIEVED, THE ASSESSEE IS IN APPEAL ITA.NO.1269/HYD/2012 BEFORE US AND HAS RAISED THE F OLLOWING GROUNDS: 1. THE ORDER OF THE CIT (APPEAL)-IV HYD, (CIT (A)) IN 8 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI DIRECTING THE ASSESSING OFFICER TO RE-COMPUTE THE LONG TERM CAPITAL GAINS BY ADOPTING THE FAIR MARKET VALUE OF THE LAND AS ON 01/04/1981 @ 9001- PER SQ YARD AND THAT OF BUILT-UP AREA AS ON 01/04/1981 @ 100 PER SQ FEET IS WHOLLY UNSUSTAINABLE BOTH IN FACTS AND IN LAW. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT (A) OUGHT TO HAVE UPHELD THE VALUATION OF THE IMMOVABLE PROPERTY AS ON 01/04/1981 BEFORE INDEXATION @ 1600 PER SQ YARD AGGREGATING TO 38,17,648/- AND THE COST OF THE BUILDING AS ON 01/04/1981 BEFORE INDEXATION AT RS.2,0 1,152/- AND THE INDEXED COST OF ACQUISITION THEREON AT RS.2,33, 89,416/- AS ON 01/04/1981, WHILE COMPUTING THE CAPITAL GAINS. 3. THE LEARNED CIT(A) FAILED TO NOTE THAT THE COST OF ACQUISITION OF THE PROPERTY AS ON 01/04/1981 AT THE OPTION OF THE APPELLANT WAS DETERMINED BY THE REGISTERED VALUER AT RS.40, 18,800/- BEFORE INDEXATION AND AT RS.2,33,89,416/- AFTER INDEXATION BY THE APPELLANT AND THEREFORE OUGHT TO HAVE UPHELD THE AFORESAID VALUATION FOR THE PURPOSE OF COMPUTING CAPITAL GAINS. 4. THE APPELLANT DENIES ITS LIABILITY TO BE ASSESSED T O THE LEVY OF INTEREST U/S 234-B AND 234-C OF THE IT ACT 1961. 15. THE DEPARTMENT HAS ALSO FILED CROSS-APPEAL AND THE GROUNDS OF APPEAL OF THE DEPARTMENT ARE AS FOLLOWS : 1. THE LEARNED CIT(A) ERRED BOTH IN LAW AND ON FACTS. 2. THE LEARNED CIT(A) WAS NOT JUSTIFIED IN ADOPTING TH E FAIR MARKET VALUE OF THE OPEN LAND @900/- PER SQ YD ON ESTIMATE BASIS AS AGAINST THE SUB REGISTRAR VALUE OF RS. 100/- PER SQ. YD WITHOUT APPRECIATING THE STAND OF THE ASSESSING OFFICER THAT THE ASSESSE E FAILED TO FURNISH ANY COMPARABLE CASES OF THE AREA ADJOINING THE ASSESSEE'S PROPERTY IN SUPPORT OF HIS ESTIMATION AND ALSO FAILED TO PROVIDE ANY EVIDENCE 9 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI TO SHOW THAT THE PROPERTY COULD HAVE FETCHED MORE VALUE THAN THE COST CERTIFIED BY THE SRO AND HENCE, ADOPTED THE SRO VALUE FOLLOWING THE DECISION OF ITAT, VISAKHAPATNAM IN THE CASE OF M. SIVA PARVATHI VS. ITO [2010] 129 TIJEVISAKHA) 463, THE FACTS OF WHICH CASE ARE SIMILAR TO THE PRESENT CASE . 3. THE LEARNED CIT(A) WAS NOT JUSTIFIED IN ADOPTING TH E COST OF CONSTRUCTION @ 100/- PER SQ. FT AS AGAINST THE SUB-REGISTRAR VALUE OF RS. 50/- PER SQ. FT ON THE ESTIMATE BASIS ON THE GROUND THAT THE FAIR MARKET VALUE OF THE BUILT-UP AREA WOULD NOT GET MUCH AFFECTED BY THE LOCATION OF THE PROPERTY. 4. THE ORDER OF LEARNED CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT THE ASSESSMENT ORDER BE RESTORED. 16. THE LEARNED D.R. PLACED RELIANCE IN THE CASE O F 129 TTJ 463 AND 252 ITR 581 (A.P.). WE FIND THAT THE CASE LAWS REFERRED BY D.R. TO BE INAPPLICABLE TO THE FACTS OF THE CASE. 17. THE LEARNED COUNSEL FOR THE ASSESSEE SHRI K.C.D EVADAS VEHEMENTLY ARGUED REITERATING THE SUBMISSIONS MADE BEFORE THE LOWER AUTHORITIES. 18. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE BOMBAY HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. RAMAN KUMAR SINGHVI HAS BEEN HELD THAT WITH RESPECT TO THE DETERMINATIO N OF THE FAIR MARKET VALUE AS ON 1 ST APRIL, 1981 THE VALUATION DONE BY A REGISTERED VALUER OF THE INCOME TAX DEPARTMENT WOUL D CERTAINLY TAKE PRECEDENCE OVER NABI GUIDE TO HOUSE TAX. THE C OURT HAD CONCLUDED THAT THE DETERMINATION OF FAIR MARKET VAL UE AS ON 1 ST APRIL, 1981 IS A QUESTION OF FACT AND THE TRIBUNAL S DECISION THAT THE FAIR MARKET VALUE AS ESTIMATED BY THE REGISTERE D VALUER ON 1 ST 10 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI APRIL, 1981 IS ACCEPTABLE. IT ALSO HELD THAT THE FI NDING OF THE TRIBUNAL IS NEITHER PERVERSE NOR ARBITRARILY DONE S O AS TO RAISE A SUBSTANTIAL QUESTION OF LAW. 19. THOUGH THE VALUATION DONE BY THE REGISTERED VA LUER IS WITH REGARD TO A SPECIFIC PROPERTY AND IS CLAIMED BY THE LEARNED COUNSEL FOR THE ASSESSEE AS MOST APPROPRIATE AND CO RRECT VALUATION WHICH IS TO BE ADOPTED IN DETERMINING THE COST OF ACQUISITION WHILE WORKING OUT THE CAPITAL GAIN, WE HAVE ALSO TO TAKE INTO ACCOUNT THE ARGUMENT OPPOSING THE ADOPTIO N OF THE SAME ON THE GROUND THAT THE REGISTERED VALUER WOULD BE INFLUENCED BY VESTED INTEREST HAVING BEEN CHOSEN BY THE ASSESSEE FOR THE PURPOSE OF VALUING THE PROPERTY. THEREFORE , THE FAIR MARKET VALUE HAS TO BE BASED ON COMPARABLE SALE INS TANCES. IN THE CASE OF DCIT VS. CHATURBHUJ VALLABHDAS HUF, MUM BAI BENCH 130 ITD 230 IT HAS BEEN CONCLUDED THAT : REFERENCE TO VALUATION OFFICER UNDER S. 55A CAN BE MADE BY A.O. IGNORING THE REPORT OF REGISTERED VALU ER REGARDLESS OF THE FACT THAT THE FAIR MARKET VALUE O F THE PROPERTY AS ON 1 ST APRIL, 1981 AS SHOWN BY THE ASSESSEE WAS MORE THAN ITS REAL FAIR MARKET VALUE; VALUATION REPORT OF THE DVO IS A RELEVANT AND ADMISSIBLE EVIDENCE ON THE MATTER IN ISSUE IRRESPEC TIVE OF ILLEGALITY OF REFERENCE MADE BY THE A.O. 20. IN THE CASE OF DCIT (INTERNATIONAL TAXATION) VS . HARBIR SINGH (2012) 34 CCH 167 (DEL.) (TRIBU.) IT HAS BEEN HELD BY THE DELHI BENCH OF THE TRIBUNAL THAT IN RESPECT OF COST OF ACQUISITION AS ON 1.4.1981 OF THE LAND SITUATED AT E-25, NEW DEFENCE COLONY, NEW DELHI, THE ASSESSEE ADOPTED COST OF ACQUISITION AS PER REPORT OF REGISTERED VALUER WHILE THE A.O. DID NOT ACCEPT THE SUBMISSIONS OF THE ASSESSEE OR 66 PERCENT INCREASE IN RATES FOR DE TERMINING COST OF ACQUISITION OVER AND ABOVE THE AVERAGE AUCTION R ATES OF LAND IN THE SAFDARJUNG ENCLAVE AREA. BOTH THE ASSESSEE AND REVENUE ARE 11 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI AGGRIEVED WITH THE FINDINGS OF THE LEARNED CIT(A). THE LEARNED AR FAIRLY ADMITTED THAT THERE WAS NO BASIS FOR INCREAS ING THE AVERAGE AUCTION RATES PREVAILING IN SAFDARJUNG ENCLAVE 66 P ERCENT WHILE THE LEARNED DR VEHEMENTLY ARGUED THAT REPORT OF REG ISTERED VALUER BEING WITHOUT ANY BASIS NOR HAVING CONSIDERE D COMPARATIVE INSTANCES OF COST OF LAND AS ON 1.4.1981 IN DEFENCE COLONY OR ADJOINING AREAS, COULD NOT BE RELIED UPON. IN THE L IGHT OF THESE SUBMISSIONS ON BEHALF OF BOTH THE PARTIES, CONSIDER ING THE TOTALITY OF FACTS AND CIRCUMSTANCES OF THE CASE, ESPECIALLY WHEN THE REPORT OF REGISTERED VALUER DOES NOT DISCLOSE THE BASIS FO R CHOOSING AVERAGE LAND AUCTION RATES IN SAFDARJUNG ENCLAVE AR EA NOR THE BASIS OF INCREASE OF SUCH RATES BY 66 PERCENT AND N OR EVEN ANY REASONS FOR NOT IDENTIFYING COMPARATIVE INSTANCES O F COST OF SIMILARLY SITUATE PROPERTIES IN DEFENCE COLONY AREA WHILE THE IMPUGNED ORDER DOES NOT DISCLOSE THE BASIS OF INCRE ASE BY 40 PERCENT OVER THE AVERAGE AUCTION RATES IN SAFDARJUN G ENCLAVE AREA, NOT MUCH RELIANCE CAN BE PLACED ON THE VALUAT ION REPORT PREPARED BY THE REGISTERED VALUER AND PARTLY RELIED UPON BY THE LEARNED CIT(A). THE DETERMINATION OF COST OF ACQUIS ITION OF A PROPERTY IS A TECHNICAL ASPECT AND WITHOUT HAVING C OMPLETE FACTS AND DETAILS OF PROPERTY, ITS LOCATION, AND ITS SURR OUNDINGS AND COMPARATIVE INSTANCES OF SIMILARLY SITUATE PROPERTI ES, COST OF ACQUISITION AS ON 1.4.1981 CANNOT BE DETERMINED IN A PRECISE MANNER. THE LEARNED CIT(A) HAVING NOT ADVERTED TO A LL THESE ASPECTS NOW RAISED, APPARENTLY THE IMPUGNED ORDER S UFFERS FROM LACK OF REASONING AND IS NOT A SPEAKING ORDER. IN V IEW OF THE FOREGOING, THE MATTER RESTORED TO THE FILE OF THE A .O. FOR DECIDING THE MATTER AFRESH IN ACCORDANCE WITH LAW, AFTER HAV ING A REPORT OF DISTRICT VALUATION OFFICER ON THE COST OF ACQUISITI ON AS ON 1.4.1981 12 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI OF THE SAID PROPERTY AND OF COURSE AFTER ALLOWING S UFFICIENT OPPORTUNITY TO THE ASSESSEE. 21. THEREFORE, IN OUR OPINION, THE ASSESSING OFFICE R SHOULD CONSIDER THE FOLLOWING : 1. THE REGISTERED VALUER REPORT AS SUBMITTED BY THE ASSESSEE. 2. REFERENCE TO THE DVO HAS TO BE MADE BY THE ASSESSIN G OFFICER AND THE REPORT OF THE DVO ON THE COST OF ACQUISITION AS ON 01/04/1981 OF THE PROPERTY HAS TO BE CONSIDERED. 3. INHERENT QUALITY OF THE PROPERTY NAMELY SIZE, LOCA TION, ROAD FRONTAGE, CORNER PLOT, IF ANY, ETC. TO BE EXAM INED. 4. ANY COMPARABLE PROPERTY IN THE SAME LOCALITY SHOULD BE TAKEN FOR CONSIDERATION. 22. THEREAFTER, THE ASSESSING OFFICER SHALL AFTER EXAMINING THOROUGHLY THE NATURE OF THE PROPERTY AND THE PECUL IAR CIRCUMSTANCES AS WELL AS THE VALUES GIVEN BY THE DI FFERENT PERSONS NAMELY DVO AND THE REGISTERED VALUER SHALL DECIDE T HE ISSUE DENOVO. IT IS NEEDLESS TO SAY THAT A REASONABLE OPP ORTUNITY OF BEING HEARD SHOULD BE GIVEN TO THE ASSESSEE. 23. IN THE RESULT, APPEAL OF THE ASSESSEE AS WELL A S THE APPEAL OF THE DEPARTMENT ARE ALLOWED FOR STATISTICAL PURPOSES . ORDER PRONOUNCED IN THE OPEN COURT ON 31.07.2013. SD/- SD/- (CHANDRA POOJARI) (ASHA VIJAYARAGHAVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATE 31 ST JULY, 2013. VBP/- 13 ITA NOS. 1428 & 1269/HYD/2012 SHRI ASHWIN JOSHI COPY TO 1. THE ACIT, CIRCLE 6(1), 7 TH FLOOR, D BLOCK, I.T.TOWERS, MASAB TANK, HYDERABAD. 2. SHRI ASHWIN JOSHI, D.NO.6-3-347, DWARAKAPURI COL ONY, PANJAGUTA, HYDERABAD PAN AGXPJ6884E 3. CIT(A)-IV, HYDERABAD 4. CIT-III, HYDERABAD 5. D.R. B BENCH, I.T.A.T. HYDERABAD