Hindustan Earthmovers Pvt. Ltd., Baroda V. The DY.CIT., Cent.Circle-1, Baroda

ITA 1744/AHD/2005

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0514 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-11-2009
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Next Hearing Date: 30-10-2009
• Assessment Year: 2001-2002
• Appeal Filed On: 11-07-2005
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M C
• Keywords: Capital asset; Fair market value; Capital Gains
• Section: 191

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH C AHMEDABAD BEFORE S/SHRI T.K. SHARMA, J.M. AND D. C. AGARWAL, A.M . ITA NOS.1744 & 2694/A/2005 ASST. YEARS : 2001-02 & 2002-03 AND ITA NO.436/AHD/2007 ASST. YEAR 2003-04 HINDUSTAN EARTHMOVERS (P) LTD., ASHWAMEGH- II, SAMRAJYA COMPLEX, AKOTA, MUNJMAHUDA ROAD, BARODA. V/S . DY COMMISSIONER OF INCOME-TAX (CENTRAL CIRCLE-I), AAYAKAR BHAVAN, BARODA. PAN NO.AAACH 8593 A (APPELLANT) .. (RESPONDENT) APPELLANT BY :- SHRI S. N. SOPARKAR WITH SHRI P.M. MEHTA RESPONDENT BY:- SHRI M. C. PANDIT, SR. D.R. O R D E R PER D.C. AGARWAL, ACCOUNTANT MEMBER. ALL THESE THREE APPEALS ARE FILED BY THE ASSESSEE FOR ASST. YEARS 2001-02, 2002-03 & 2003-04 INVOLVING COMMON ISSUE A ND HENCE THEY ARE DISPOSED OF TOGETHER FOR THE SAKE OF CONVENIENCE. T HE ISSUE INVOLVED IS WHETHER THE AO WAS JUSTIFIED IN REDUCING THE VALUE OF THE PLOT OF LAND SOLD BY THE ASSESSEE FROM THE VALUE OF THE ASSESSEE AS DECLARED. FOR THE SAKE OF CONVENIENCE THE COMMON GROUNDS RAISED BY TH E ASSESSEE IN AY 2001-02 ARE REPRODUCED AS UNDER :- ITA NO. 1744 & 2694 & 436 2 1. THE LD. CIT(A)-IV, AHMEDABAD HAS ERRED IN LAW AND I N FACTS IN CONFIRMING THE ACTION OF THE LD. DEPARTMENTAL VA LUATION OFFICER IN VALUING THE IMMOVABLE PROPERTY TRANSFERR ED BY THE APPELLANT AT RS.19/- PER SQ.FT. AS PER MARKET VALUE AS ON 01.04.81 FOR DETERMINING THE CAPITAL GAIN INCOME FO R THE YEAR UNDER CONSIDERATION AS AGAINST THE VALUE DETERMINED BY THE APPELLANT AT RS.23/- PER SQ.FT. THE LD. CIT(A), AHM EDABAD OUGHT TO HAVE ACCEPTED THE FAIR MARKET VALUE DETERM INED BY THE APPELLANT. 2. THE LD. CIT(A) IV, AHMEDABAD HAS ERRED IN LAW AND I N FACTS IN DIRECTING THE LD. A.O. TO RECOMPUTED THE CAPITAL GAINS ON TRANSFER OF LAND BY ADOPTING THE FAIR MARKET VALUE @ RS.19/- PER SQ.FT. RESULTING INTO DETERMINATION OF CAPITAL GAINS AT RS.61,28,510/- AS AGAINST RS.11,80,140/- DETERMINED BY THE APPELLANT. THE ADDITIONAL CAPITAL GAIN INCOME OF RS.49,48,370/- DETERMINED IN CONTRADICTION OF AVAIL ABLE FACTS AND MATERIAL ON RECORD DESERVES TO BE DELETED. 2. THE FACTS OF THE CASE ARE THAT ASSESSEE IS A COM PANY ENGAGED IN THE BUSINESS OF REAL ESTATE DEVELOPMENT AND CONSTRUCTIO N. THE ASSESSEE COMPANY HAD 13,40,000 SQ.FT. OF LAND WHICH WAS DECL ARED AS CAPITAL ASSET. IT WAS CONVERTED INTO STOCK IN TRADE ON 5.1.1998 AN D SUBSEQUENTLY ASSESSEE SOLD TO VARIOUS PARTIES. THE SALE IS SPREA D OVER IN THE ABOVE THREE ASST. YEARS FOR CALCULATING LONG TERM CAPITAL GAINS . THE ASSESSEE ADOPTED THE COST OF LAND AT RS.23/- PER SQ.FT. AS ON 1.4.19 81. THE AO CARRIED OUT ENQUIRY FROM THE SUB-REGISTRARS OFFICE AND NOTED T HAT THE COST OF THE LAND AS ON 1.4.1981 WAS MUCH LESS THAN RS.23 PER SQ .FT. THE AO ISSUED A SHOW CAUSE NOTICE, OBTAINED ITS REPLY AND THEREAFTE R ON THE BASIS OF SALE INSTANCES OBTAINED BY HIM FROM THE OFFICE OF THE SU B-REGISTRAR ADOPTED THE COST OF LAND AT RS.10/- PER SQ.FT. AS ON 1.4.19 81. THE SALE INSTANCES OBTAINED BY THE AO FROM SUB-REGISTRARS OFFICE MADE BASIS FOR ARRIVING AT HIS DECISION ARE AS UNDER :- SURVEY NO. DATE OF COCUMENT AREA IN SQ.FT. SALE PRICE RATE PER SQ.FT. 838,839 & 840 10,06.1981 43,560 40,000 9.18 838,839 & 840 11.06.1981 49,353 40,000 8.1 39 24.05.1984 4.842 80,000 16.52 47 28.06.1985 4.842 69,495 14.35 145 26.071985 3.030 30,350 10.01 257-260 11.07.1985 461.06 48,000 104.1 535 17.07.1985 3,991.96 50,000 12.52 ITA NO. 1744 & 2694 & 436 3 THE AO ACCORDINGLY CALCULATED THE LONGTERM CAPITAL GAIN FOR ALLOWING NECESSARY INDEXATION. 3. IN APPEAL THE LD. CIT(A) REFERRED TO A DECISION OF THE ITAT, AHMEDABAD BENCH A IN THE CASE RAMABEN M. PATEL, B ARODA IN ITA NO.3088/AHD/1997 IN WHICH UNDER IDENTICAL CIRCUMSTA NCES THE MATTER WAS REFERRED BACK TO THE VALUATION OFFICER BY INVOK ING THE PROVISIONS OF SECTION 55A OF THE IT ACT, 1961. THE MATTER WAS ACC ORDINGLY REMANDED TO THE AO WITH A DIRECTION TO REFER THE MATTER TO THE DVO FOR DETERMINING THE COST AS ON 1.4.1981 INVOKING THE PROVISIONS OF SECTION 55A OF THE ACT. THE DVO ACCORDINGLY SUBMITTED HIS REPORT TO THE AO IN THE REMAND PROCEEDINGS AND REFERRED TO THREE SALE INSTANCES ON THE BASIS OF WHICH HE ADOPTED A RATE OF RS.19/- PER SQ.FT. AS ON 1.4.1981 . THE SALE INSTANCES REFERRED TO BY THE LD. DVO IN HIS REPORT WERE AS UN DER :- S.N. LOCATION AREA (SQ.FT.) CONSIDERATION (RS.) RATE PER SQ.FT.(RS.) SELLER/PURCHASER REGD. NO./ DATE FMV AS ON 1.4.81 1. SURVEY NO.276,277 TPS NO.1, FP NO.214 PLOT NO.6,AKOTA, BARODA 15995.30 2,46,676 15.42 THAKORBHAI D. DESAI AND F, PATHAK 6918 29.12.80 2. SURVEY NO.276,277 TPS NO.1, FP NO.214 PLOT NO.315995.30 AKOTA, BARODA 3,16,676 19.80 19.80 THAKOR D. DESAI/ KANTILAL B JANI 6921 29/12/80 3. SURVEY NO.114 TPS NO.1, FP NO.466 PLOT NO.154 JATALPUR, BARODA 4768.45 71,475 14.99 PRADIP KUMAR DAHYABHAI/JAYSHREEBEN N.PATEL & OTHERS 2671 21.5.81 THUS ON THE BASIS OF DVOS REPORT THE LD. CIT(A) DI RECTED TO ADOPT THE COST OF THE LAND AT RS.19/- PER SQ.T. 4. THE AO WHILE CALCULATING THE CAPITAL GAINS FOR A Y 2002-03 ADOPTED A RATE OF RS.10/- PER SQ.FT. AS TAKEN BY HI M IN AY 2001-02 AND THE LD. CIT(A) DIRECTED TO ADOPT RS.19/- AS HELD BY HIM IN AY 2001-02. FOR AY 2002-03 THE AO HIMSELF ADOPTED A RATE OF RS.19/- PER SQ.FT. AS ON 1.4.1981 ON THE BASIS OF DIRECTION OF CIT(A) IN AY 2001-02 AND 2002-03. ITA NO. 1744 & 2694 & 436 4 5. THE ASSESSEE IS NOW IN APPEAL FOR ALL THESE THRE E ASST. YEARS AGAINST THE ORDERS OF THE LD. CIT(A) IN DIRECTING AND SUBSE QUENTLY CONFIRMING ADOPTING RATE OF RS.19/- PER SQ.FT. AS ON 1.4.1981. THE LD. A.R. FOR THE ASSESSEE SUBMITTED AT THE OUTSET THAT PROVISIONS OF SECTION 55A CANNOT BE INVOKED FOR REDUCING THE MARKET VALUE OF THE LAND A S DONE IN THE PRESENT CASE. IT CAN ONLY BE INVOKED IF AO HAS REASONS TO B ELIEVE THAT MARKET VALUE OF THE CAPITAL ASSET SOLD IS MORE THAN APPARE NT CONSIDERATION DECLARED BY THE ASSESSEE FOR CALCULATING THE CAPITA L GAINS. HE REFERRED TO THE DECISION OF HONBLE GUJARAT HIGH COURT IN HIABE N JAYANTILAL SHAH VS. ITO (2009) 181 TAXMAN 191 (GUJ) AND ALSO A DECISION GIVEN BY THE ITAT, AHMEDABAD A BENCH IN ACIT VS. SMT. RAMABEN V. JANI IN ITA NO.658/AHD/2002 AY 1994-95 DECIDED ON 17.11.2006. H E SUBMITTED THAT THE TIME WHEN THE LD. CIT(A) RELIED ON THE DECISION OF ITAT IN THE CASE OF RAMABEN M PATEL, BARODA (SUPRA) BENEFIT OF HONBLE GUJARAT HIGH COURT IN THE CASE OF HIABEN JAYANTILAL SHAH VS. ITO (SUPR A) WAS NOT AVAILABLE. SUBSEQUENTLY MANY TRIBUNALS HAVE ALSO HELD THAT REF ERENCE TO VALUATION OFFICER UNDER SECTION 55A CANNOT BE MADE FOR DETERM INING THE VALUE OF CAPITAL ASSET AS ON 1.4.81. IN ADDITION TO ABOVE, T HE LD. AR FOR THE ASSESSEE SUBMITTED THAT SALE INSTANCES ADOPTED BY LD. DVO AR E IN RESPECT OF THE PROPERTIES WHICH ARE FAR OFF FROM THE AREA SOLD BY THE ASSESSEE AND, THEREFORE, NOT APPLICABLE TO THE PLOTS OF LAND SOLD BY THE ASSESSEE. HE REFERRED TO THE MAPS OF THE AREA SOLD AND POINTED O UT THAT DVO HAS TAKEN SALE INSTANCES OF FAR OFF PROPERTIES WHEREAS APPROV ED VALUER OF THE ASSESSEE HAS TAKEN SALE INSTANCES OF THE PROPERTY A DJACENT TO THE PROPERTY SOLD BY THE ASSESSEE. THE LD. AR ALSO POINTED OUT T HAT THE SALE INSTANCES SELECTED BY THE APPROVED VALUER OF THE ASSESSEE HAV E BEEN REJECTED BY THE DVO MERELY ON THE GROUND THAT THEY PERTAINED TO THE PERIOD AFTER 1.4.81 AND TO BE SPECIFIC PERTAINED TO THE MONTH OF MAY AN D JUNE, 1981. BUT THE LD. DVO HAS HIMSELF ADOPTED ONE SALE INSTANCE WHICH PERTAINED TO THE MONTH OF MAY,1981. THEREFORE, HE WAS NOT CORRECT IN REJECTING THE VALUE ADOPTED BY THE ASSESSEE. FINALLY THE LD. AR SUBMITT ED THAT THE SALE INSTANCES ON WHICH THE APPROVED VALUER HAS RELIED G IVEN SALE RATES AS HIGH AS RS.39.41, RS.49.80, RS.94.58 AND RS.48.84 PER SQ .FT. BUT THE LD. APPROVED VALUER HAS ADOPTED THE SALE RATE OF RS.23 PER SQ.FT. ON THE BASIS OF THE INSTANCES GIVING LOWEST RATE. HE REFERRED TO THE FOLLOWING SALE INSTANCES AS GIVEN BY THE APPROVED VALUERS BY MR. J .M. SAMPAT AND MR. P.M. MEHTA AS UNDER :- ITA NO. 1744 & 2694 & 436 5 BY SHRI J. M. SAMPAT IN THE MAP MARKED AS SR. NO. IN THE REPORT FP NO./R.S. NO. SHOWING RATE PER SQ.FT. REMARKS B 2 20/41 RS.39.41 IN THE TPS R.S. NO.41 HAS BEEN COVERED IN FP NO.20. IT IS SUPPORTED BY SITE PLAN (NO.1) OBTAINED FROM VADODARA SEVA SADAN. THIS SITE IS EXACTLY ON THE OPPOSITE SIDE OF PROPERTY. C 3 282/264 (1) RS.23.80 IN THE TPS R.S. NO.264(1) HAS BEEN COVERED IN FP 282. IT IS SUPPORTED BY SITE PLAN (NO.2) OBTAINED FROM VADODARA SEVA SADAN. D 4 548/258 RS.22.18 IN THE TPS R.S. NO.258 HAS BEEN COVERED IN FP 548. IT IS SUPPORTED BY SITE PLAN (NO.3) OBTAINED FROM VADODARA SEVA SADAN. IT INDICATES THAT R.S. NO.257 TO 269 HAD BEEN COVERED IN FP NO.548. BY SHRI P. M. MEHTA IN THE MAP MARKED AS SR. NO. IN THE REPORT FP NO./R.S. NO. SHOWING RATE PER SQ.FT. REMARKS A-1 1 463 RS.49.80 THIS IS NEAR TO F.P. NO.466. THE DVO HAS TAKEN INSTANCES D-3 WHICH PERTAINS TO F.P. NO.466 A-2 2 469 RS.29.28 THIS IS NEAR TO F.P. NO.466. THE DVO HAS TAKEN INSTANCES D-3 WHICH PERTAINS TO F.P. NO.466. A-3 3 79/78(P) RS.35.55 R.S. NO.77 AND 78 OF AKOTA HAD BEEN ALLOTTED F.P. NO.79 AS PER ADDRESS THE SITE IS LOCATED OPPOSITE TO F.P. NO.79 NEAR ATITHI GRUH ADJOINING AREA OF AKOTA GARDEN. SITE PLAN NO.4. A-5 5 548 RS.44.58 IT IS LOCATED ON EAST OF PUNIT NAGAR, NEAR AJIT NAGAR. A-6 6 469 RS.41.84 THE F.P. NO.469 IS NEAR TO F.P. NO.466. THE DVO HAS TAKEN INSTANCES D-3 WHICH PERTAINS TO FP NO.466. THUS HE SUBMITTED THAT NOTWITHSTANDING THE JUDGMENT OF HONBLE GUJARAT HIGH COURT COST ADOPTED BY THE ASSESSEE AT RS.23/- PER SQ. FT. IS REASONABLE AND SHOULD NOT BE REJECTED. 6. ON THE OTHER HAND THE LD. DR SUBMITTED THAT THE DECISION OF HONBLE GUJARAT HIGH COURT REFERRED BY THE LD. AR I S NOT APPLICABLE BECAUSE REFERENCE WAS MADE BY THE AO AT THE DIRECTI ON OF LD. CIT(A) AND NOT AT HIS OWN. HE ALSO SUBMITTED THAT SALE INSTANC ES ADOPTED BY THE ITA NO. 1744 & 2694 & 436 6 ASSESSEE PERTAINED TO DEVELOPED PLOT OF LAND AND OF SMALLER AREA, THEREFORE, THEY FETCHED HIGHER VALUE. 7. THE LD. AR REFERRED TO THE ADDITIONAL GROUND RAI SED BY THE ASSESSEE WHEREIN IT IS CONTENDED THAT THE LD. CIT(A) COULD N OT HAVE BEEN GIVEN DIRECTION TO THE AO TO REFER THE PROPERTY UNDER SEC TION 55A TO DETERMINE THE COST AS ON 1.4.81 IN VIEW OF THE DECISION OF GU JARAT HIGH COURT IN M.V. SHAH OFFICIAL LIQUIDATOR, ANANT MILLS LTD. VS. U. J. MATAIN REPORTED IN 209 ITR 568 AND SUBMITTED THAT THE GROU ND RAISED IN THE APPEALS SHOULD BE DECIDED FIRST. 8. WE NOTICED THAT LD. CIT(A) IN THE IMPUGNED ORDER HAD DIRECTED THE AO TO REFER THE PROPERTY TO THE DVO UNDER SECTION 5 5A ON THE BASIS OF DECISION OF ITAT, AHMEDABAD IN THE CASE OF RAMABEN M. PATEL (SUPRA), OBTAINED REMAND REPORT FROM HIM ON THE BASIS OF THE DVO. THEREFORE, THE LD. AR IS JUSTIFIED IN RAISING ADDITIONAL GROUND AS TO THE POWER OF LD. CIT(A) IN DIRECTING THE AO TO MAKE REFERENCE TO DVO . THE DECISION OF THE TRIBUNAL IN RAMABEN M. PATEL (SUPRA) IS NO LONG ER A GOOD LAW IN THE VIEW OF THE SUBSEQUENT DEVELOPMENT IN THIS FIELD. T HE LEAD AUTHORITY IS THE DECISION OF HONBLE GUJARAT HIGH COURT IN THE CASE OF HIABEN JAYANTILAL SHAH VS. ITO (SUPRA) WHEREIN THE FACTS WERE SIMILAR , A REFERENCE WAS MADE TO DVO TO DETERMINE THE FAIR MARKET VALUE OF T HE PROPERTY AS ON 1.4.1981. IT WAS HELD BY THE HONBLE HIGH COURT THA T REFERENCE UNDER SECTION 55A COULD BE MADE BY THE AO UNDER TWO CIRCU MSTANCES DESCRIBED IN CLAUSE (A) AND CLAUSE (B) THEREOF. FOR THE SAKE OF CONVENIENCE WE REFER TO SECTION 55A AS UNDER :- 9. THE REQUIREMENT TO DETERMINE THE FAIR MARKET VAL UE OF THE ASSET AS ON 1.4.81 IS FOR THE PURPOSE OF SECTION 48 AND 49 U NDER CLAUSE (A) OF SECTION 55A. A REFERENCE TO THE D.V.O. CAN BE MADE IF AO IS OF THE OPINION THAT VALUE CLAIMED BY THE ASSESSEE AS PER E STIMATE MADE BY THE REGISTERED VALUER IS LESS THAN ITS FAIR MARKET VALU E. AS PER CLAUSE (B) A REFERENCE CAN BE MADE TO DVO IF FAIR MARKET VALUE O F THE ASSET EXCEEDS THE VALUE OF THE ASSET AS CLAIMED BY THE ASSESSEE B Y SUCH PERCENTAGE AS PRESCRIBED IN THIS BEHALF AND ALSO AS PER SUB-CLAUS E (II) IT CAN BE REFERRED HAVING REGARD TO THE NATURE OF THE ASSET AND OTHER RELEVANT CIRCUMSTANCES. THE HONBLE GUJARAT HIGH COURT UNDER THESE CIRCUMST ANCES HAS HELD AS UNDER :- 11. AS CAN BE SEEN FROM THE COMMUNICATION DATED NI L (ANNEXURE D) FROM RESPONDENT NO.2-DVO TO THE PETITIONER INSOFAR AS THE FAIR MARKET VALUE OF THE PROPERTY AS ON 1.4.81 IS CONCER NED, THE PETITIONER HAD CLAIMED THE SAME AT A SUM OF RS.6,25 ,000/- AS PER ITA NO. 1744 & 2694 & 436 7 THE REGISTERED VALUERS REPORT. THEREFORE, THE AO W AS REQUIRED TO FORM AN OPINION THAT THE VALUE SO CLAIMED IS LESS T HAN THE FAIR MARKET VALUE. THE ESTIMATED VALUE PROPOSED BY THE D VO IS SHOWN AT RS.3,97,000/- WHICH IS LESS THAN THE FAIR MARKET VALUE SHOWN BY THE ASSESSEE SO ON 1.4.81. THEREFORE, CLAU SE (A) OF SECTION 55A OF THE ACT CANNOT BE MADE APPLICABLE. C LAUSE (B) OF SECTION 55A OF THE ACT CAN BE INVOKED ONLY IN ANY O THER CASE, NAMELY, WHEN THE VALUE OF THE ASSET CLAIMED BY THE ASSESSEE IS NOT SUPPORTED BY AN ESTIMATE MADE BY A REGISTERED V ALUER. IN THE FACTS OF THE PRESENT CASE CLAUSE (B) OF SECTION 55A OF THE ACT ALSO CANNOT BE INVOKED. THEREFORE THERE IS NO QUEST ION OF HAVING RECOURSE TO SUB-CLAUSE (II) OF CLAUSE (B) OF SECTIO N 55A OF THE ACT. 12. THERE IS ONE MORE ASPECT OF THE MATTER. FOR INVOKIN G SECTION 55A OF THE ACT, THERE HAS TO BE A CLAIM MADE BY THE ASSESSEE, BEFORE THE AO CAN RECORD OPINION EITHER UNDER CLAUS E (A) OR CLAUSE (B) OF SECTION 55A OF THE ACT TO MAKE A REFE RENCE TO THE VALUATION OFFICER. THE FACTS OF THE PRESENT CASE GO TO SHOW THAT THE REFERENCE WAS MADE ON 26.4.1996, WHEREAS THE RE TURN OF INCOME HAD BEEN FILED BY THE ASSESSEE ONLY ON 27.8. 1996. HENCE ON THE DATE OF MAKING THE REFERENCE BY THE AO NO CL AIM WAS MADE BY THE ASSESSEE AND THE AO COULD NOT HAVE FORM ED ANY OPINION AS TO EXISTENCE OF PRESCRIBED DIFFERENCE BE TWEEN THE VALUE OF THE ASSET AS CLAIMED BY THE ASSESSEE AND T HE FAIR MARKET VALUE. THEREFORE ALSO, THE PROVISIONS OF SECTION 55 A OF THE ACT COULD NOT HAVE BEEN RESORTED TO BY THE ASSESSING OF FICER. 10. THUS PROVISION OF SECTION 55A(A) PROVIDES REFER ENCE TO DVO ONLY IF AO IS OF THE OPINION THAT THE FMV AND THE ESTIMA TED VALUE BY THE REGISTERED VALUER IS LESS THAN FMV AS ESTIMATED BY THE AO. THE AO IN THE INSTANT CASE COULD NOT HAVE FORMED SUCH OPINION BEC AUSE THE ESTIMATION OF FMV MADE BY THE REGISTERED VALUER AS ON 1.4.81 W AS HIGHER I.E. RS.23/- PER SFT. THAN ITS ACTUAL FMV ESTIMATED BY THE AO AT RS.10/- PER SFT. A REFERENCE UNDER SECTION 55A CLAUSE (B) AND SUB-CLAU SE (II) CAN BE MADE BY THE AO IF HE IS OF THE OPINION HAVING REGARD TO THE NATURE OF THE ASSET AND OTHER RELEVANT CIRCUMSTANCES THAT IT IS NECESSARY T O DO SO. IT IS OBLIGATORY ON THE PART OF THE AO TO RECORD SUCH OTHER RELEVANT CIRCUMSTANCES WHICH COULD BECOME BASIS FOR FORMING SUCH AN OPINION BEFO RE HE MAKES REFERENCE TO THE VALUATION CELL. THE REVENUE HAS NO T SHOWN AS TO WHY REFERENCE HAS BEEN MADE UNDER SECTION 55A(A) OR UND ER SECTION 55A(B)(II). IN MS. RBAB M. KAZERANI VS. JCIT (2004) 91 ITD 429 (MUM) (TM), THE THIRD MEMBER HELD THAT NEITHER THE AO NOR THE CIT(A) CAN ITA NO. 1744 & 2694 & 436 8 ASSUME POWER TO GIVE SUCH A DIRECTION WHERE VALUE O F THE PROPERTY IS ESTIMATED BY THE APPROVED VALUER. IT IS FURTHER HEL D THAT CLAUSE (B) WOULD BE APPLICABLE ONLY IN ANY OTHER CASE I.E. IN A CASE WHERE COST IS NOT ESTIMATED BY REGISTERED VALUER. THUS WHERE NO VALUE RS REPORT IS GIVEN BY THE ASSESSEE ONLY THEN AO CAN INVOKE HIS POWER UNDE R SECTION 55A(B) AND FURTHER WHEN CONDITION LAID DOWN IN THAT SUB SE CTION ARE SATISFIED. IN THE PRESENT CASE SINCE REGISTERED VALUER HAS SUBMIT TED HIS REPORT THEN ONLY CLAUSE (A) WOULD BE APPLICABLE. HENCE THIS CONDITIO N LAIDOWN IN THAT SUB SECTION ARE NOT SATISFIED I.E. FMV AS ESTIMATED BY REGISTERED VALUER IS NOT LESS THAN FMV AS ESTIMATED BY THE AO. THE REFERENCE TO THE DVO WOULD BE INVALID. 11. THUS IN THE PRESENT CASE NEITHER THE CONDITION LAID DOWN IN CLAUSE (A) NOR IN (B) OR IN SUB-CLAUSE (II) ARE SATISFIED. THEREFORE, LD. CIT(A) COULD NOT HAVE DIRECTED TO MAKE SUCH A REFERENCE. 12. SIMILAR VIEW HAS BEEN GIVEN BY SEVERAL BENCHES OF THE TRIBUNAL AS UNDER:- (1) SMT. KRISHNABAI TINGRE (2006) 101 ITD 317 (PUN E) (2) SAJJANKUMAR M. HARLALKA VS. JCIT (2006) 100 ITD 418 (MUM) 13. SO FAR THE MERIT OF THE REPORT AND ADDITION IS CONCERNED IN OUR VIEW THE SAME IS NO LONGER REQUIRED TO BE ADJUDICATED BE CAUSE REFERENCE AS SUCH IS INVALID. 14. AS A RESULT ALL THESE APPEALS FILED BY THE ASSE SSEE ARE ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 6/11/2009 SD/- SD/- (T.K.SHARMA) (D.C. AGARWAL) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD, DATED : 6/11/2009 MAHATA/- ITA NO. 1744 & 2694 & 436 9 COPY OF THE ORDER FORWARDED TO :- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD