K. SRINIVASAMURTHY, CHENNAI V. ACIT, NCC - 2 (1), CHENNAI

ITA 2143/CHNY/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 4360 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2016-2017
• Appeal Filed On: 19-07-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R.T. VIJAYARAGHAVAN
• Keywords: Fair market value; Valuation report; Set aside
• Section: 20

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , . !, # !$ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI S. JAYARAMAN, ACCOUNTANT MEMBER ./ ITA NO.2143/CHNY/2019 & '& / ASSESSMENT YEAR : 2016-17 SHRI K. SRINIVASAMURTHY, NO.38, SUNDARA THANIKACHALAM STREET, T. NAGAR, CHENNAI - 600 017. PAN : AACPS 3936 P V. THE ASSISTANT COMMISSIONER OF INCOME TAX, NON-CORPORATE CIRCLE 2(1), CHENNAI - 600 034. ()*/ APPELLANT) (+,)*/ RESPONDENT) )* - . / APPELLANT BY : SHRI R.T. VIJAYARAGHAVAN, CA +,)* - . / RESPONDENT BY : SHRI AR.V. SREENIVASAN, JCIT / - 0# / DATE OF HEARING : 17.10.2019 12' - 0# / DATE OF PRONOUNCEMENT : 20.11.2019 / O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER : THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) -2, CHENNA I, DATED 24.05.2019 AND PERTAINS TO ASSESSMENT YEAR 2016-17. 2. SHRI R.T. VIJAYARAGHAVAN, THE LD. REPRESENTATIVE FOR THE ASSESSEE, SUBMITTED THAT THE ONLY ISSUE ARISES FOR CONSIDERATION IS 2 I.T.A. NO.2143/CHNY/19 DETERMINATION OF FAIR MARKET VALUE AS ON 01.04.1981 . ACCORDING TO THE LD. REPRESENTATIVE, THE ASSESSING OFFICER AS WE LL AS THE CIT(APPEALS) FOUND THAT THERE WAS NO GUIDELINE VALU E AVAILABLE AS ON 01.04.1981 IN THE SUB-REGISTRAR OFFICE. MOREOVE R, NO COMPARABLE CASES ARE ALSO AVAILABLE. THE LD. REPRE SENTATIVE FURTHER SUBMITTED THAT AS ON 01.04.1981, THE VALUATION WAS MADE AS PER ACREAGE / CENT BASIS AND PRESENTLY IT IS VALUED ON SQUARE FEET BASIS. ON A QUERY FROM THE BENCH WHETHER THE MATTER WAS RE FERRED TO VALUATION OFFICER OF THE DEPARTMENT OR THE ASSESSEE HAS FILED ANY REGISTERED VALUERS REPORT, THE LD. REPRESENTATIVE CLARIFIED THAT IT WAS NEITHER REFERRED TO DVO NOR THE ASSESSEE HAS FURNIS HED ANY VALUATION REPORT. THE LD. REPRESENTATIVE SUBMITTED THAT THE MATTER MAY BE REMITTED BACK TO THE FILE OF THE ASSESSING O FFICER FOR RECONSIDERATION. 3. WE HEARD SHRI AR.V. SREENIVASAN, THE LD. DEPARTM ENTAL REPRESENTATIVE ALSO. ACCORDING TO THE LD. D.R., TH ERE WAS NO GUIDELINE VALUE AVAILABLE AND THERE WAS NO COMPARAB LE SALE INSTANCE. THEREFORE, ACCORDING TO THE LD. D.R., TH E ASSESSING OFFICER ESTIMATED THE VALUE AS ON 01.04.1981 ON THE BASIS OF THE 3 I.T.A. NO.2143/CHNY/19 SALE DEED REGISTERED IN THE YEAR 2016 AND THE FAIR MARKET VALUE WAS DETERMINED ON BACKWARD WORKING. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITH ER SIDE AND PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. THE GUIDELINE VALUE WAS DETERMINED BY THE GOVERNMENT OF TAMIL NAD U IN THE ENTIRE STATE FOR THE PURPOSE OF GUIDING THE RESPECT IVE OFFICERS / SUB- REGISTRARS TO DETERMINE THE FAIR MARKET VALUE AFTER CONSIDERING THE GUIDELINE VALUE. THEREFORE, IT IS OBVIOUS THAT GUI DELINE VALUE IS NOT THE MARKET VALUE. IT IS ONLY A GUIDANCE TO DETERMI NE THE MARKET VALUE. THE MARKET VALUE MAY FLUCTUATE DEPENDING UP ON VARIOUS FACTORS. MOREOVER, WHEN THE GOVERNMENT FIXED GUID ELINE VALUE FOR ENTIRE STATE OF TAMIL NADU, IT MAY NOT BE CORRECT T O SAY THAT FOR A PART OF LAND SITUATED IN THE DISTRICT OF DINDIGUL, THE GUIDELINE VALUE WAS NOT AVAILABLE. KODAIKANAL IS ALSO PART OF DIND IGUL DISTRICT AND PART OF TAMIL NADU, THEREFORE, IT IS FOR THE AUTHOR ITIES CONCERNED TO FIND OUT THE GUIDELINE VALUE FROM THE CONCERNED REG ISTRATION AUTHORITIES. 5. FAIR MARKET VALUE HAS TO BE DETERMINED ON THE BA SIS OF LOCATION OF THE PROPERTY, SIZE OF THE PROPERTY, WIL LINGNESS OF THE 4 I.T.A. NO.2143/CHNY/19 VENDOR AND PURCHASER, DEMAND IN THE MARKET, AVAILAB ILITY OF INFRASTRUCTURE FACILITIES AROUND THE PROPERTY, AVAI LABILITY OF EDUCATIONAL INSTITUTION, AVAILABILITY OF HOSPITALS AND OTHER INFRASTRUCTURE FACILITIES AROUND THE PROPERTY. IT ALSO NEEDS TO BE CONSIDERED THE POTENTIAL FOR FUTURE DEVELOPMENT. G UIDELINE VALUE AND COMPARABLE INSTANCES IN THE LOCALITY ARE ALSO T O BE TAKEN INTO CONSIDERATION WHILE DETERMINING THE FAIR MARKET VAL UE AS ON 01.04.1981. THESE FACTS WERE NOT APPARENTLY CONSID ERED EITHER BY BOTH THE AUTHORITIES BELOW OR BY THE ASSESSEE WHILE FURNISHING THE FAIR MARKET VALUE AS ON 01.04.1981. THEREFORE, THI S TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER NEEDS TO BE RE-EXAMINED BY THE ASSESSING OFFICER. ACCORDINGLY, ORDERS OF BOTH THE AUTHORITIES BELOW ARE SET ASIDE AND THE ISSUE OF DETERMINING TH E FAIR MARKET VALUE AS ON 01.04.1981 FOR THE PURPOSE OF COMPUTATI ON OF CAPITAL GAIN IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHALL RE-EXAMINE THE MATTER AND D ETERMINE THE FAIR MARKET VALUE AS ON 01.04.1981 AFTER CONSIDERING ALL THOSE FACTORS. IT IS OPEN TO THE ASSESSEE TO FURNISH VALUATION REPORT FROM A REGISTERED VALUER OF HIS CHOICE. THE ASSESSING OFFICER ALSO M AY REFER THE MATTER TO THE DEPARTMENTAL VALUATION OFFICER IF HE FINDS NECESSARY. 5 I.T.A. NO.2143/CHNY/19 5. WITH THE ABOVE OBSERVATION, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE COURT ON 20 TH NOVEMBER, 2019 AT CHENNAI. SD/- SD/- (. !) ( . . . ) (S. JAYARAMAN) (N.R.S. GANESAN) # / ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, 4 /DATED, THE 20 TH NOVEMBER, 2019. KRI. - +056 76'0 /COPY TO: 1. )*/ APPELLANT 2. +,)*/ RESPONDENT 3. / 80 () /CIT(A)-2, CHENNAI 4. PRINCIPAL CIT-1, CHENNAI 5. 69 +0 /DR 6. :& ; /GF.