Mrs. Anjali Bharat Kabra, Jalgaon V. ITO, Ward 2(2), Jalgaon

ITA 547/PUN/2013

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 1078 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 21-07-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 25-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Sale consideration of property below Jantri Value; Value adopted by valuation officer; Capital asset; Opportunity of being heard; Principle of natural justice; Additional evidence; Fair market value; Valuation report
• Section: 50C; 54F

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , . . , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI R.K. PANDA, AM . / ITA NO. 547 /PN/20 1 3 / ASSESSMENT YEAR : 20 09 - 10 MRS. ANJALI BHARAT KABRA, NEAR KADI KARKHANA, SITAMAI NAGAR, CHALISGAON, DIST. JALGAON. . / APPELLANT PAN: A RYPK5707H VS. THE INCOME TAX OFFICER , WARD - 2(2), JALGAON . / RESPONDENT / APPELLANT BY : SHRI S.N. PURANIK / RESPONDENT BY : SHRI SUHAS KULKARNI, JCIT / DATE OF HEARING : 2 1 . 0 7 .201 6 / DATE OF PRONOUNCEMENT: 26 . 0 8 .20 1 6 / ORDER PER SUSHMA CHOWLA, JM: THIS APPEAL FILED BY THE ASSESSEE IS AGAINST ORDER OF C I T (A) - II , NASHIK , DATED 28 . 12 .20 1 2 RELATING TO ASSESSMENT YEAR 2009 - 10 AGAINST ORDER PASSED UNDER SECTION 143 (3) OF THE INCOME TAX ACT, 19 61 (IN SHORT TH E ACT) . UNDER SECTION 143 (3) OF THE INCOME TAX ACT, 19 61 (IN SHORT TH E ACT) . ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 2 2 . THE ASSESSEE HAS FILED THE FOLLOWING CONCISE GROUND OF APPEAL: - 1 . COMMISSIONER (APPEALS) HAS ERRED IN CONFIRMING THE COMPUTATION OF LONG TERM CAPITAL GAIN AT RS.1,61,39,390/ - TAKING STAMP DUTY VALUATION AS FULL VALUE OF CAPITAL GAIN AT RS.1,61,39,390/ - TAKING STAMP DUTY VALUATION AS FULL VALUE OF CONSIDERATION, AGAINST LO NG TERM CAPITAL LOSS OF RS.1,29,690/ - RETURNED BY THE ASSESSEE, ON ACTUAL CONSIDERATION. ADDITIONS MADE MAY PLEASE BE DELETED. 2 . COMMISSIONER (APPEALS) HAS ERRED IN ACCEPTING DVOS COMMENTS ON OBJECTIONS TO VALUATION OFFICER REPORT, EVEN THOUGH DVO HAS NOT GIVEN THE OPPORTUNITY OF BEING HEARD TO ASSESSEE. 3 . COMMISSIONER (APPEALS) ERRED IN NOT EXTENDING THE OPPORTUNITY OF BEING HEARD TO DVO. (36 TAXMAN.COM 393 BBAY) 4 . CIT(A) HAS ERRED IN NOT APPRECIATING THAT NEITHER THE STAMP VALUATION AUTHORITY NOR THE VALU ATION OFFICER HAS TAKEN INTO CONSIDERATION VITAL ASPECT OF DISPUTED TITLE OF THE PROPERTY BEING SUBJUDICE & ADOPTING THE STAMP VALUATION. TITLE OF THE PROPERTY BEING SUBJUDICE & ADOPTING THE STAMP VALUATION. 5 . A) CIT(A) HAS ERRED IN ADOPTING FAIR MARKET VALUE OF 01.04.1981 AS PER VALUATION OFFICERS REPORT AGAINST APP ROVED VALUERS REPORT. B) REFERENCE TO VALUATION OFFICE FOR VALUATION OF FMV AS OF 01.04.1981 IS WITHOUT JURISDICTION AND BAD IN LAW. (BY WAY OF ADDITIONAL GROUND) 3. THE ASSESSEE HAS ALSO RAISED AN ADDITIONAL GROUND OF APPEAL, WHICH READS AS U NDER: - 1. REFERENCE TO VALUATION OFFICER MADE BY ASSESSING OFFICER FOR VALUATION TO ASCERTAIN FMV OF PROPERTY AS ON 01/04/1981 IS WITHOUT JURISDICTION AND ASCERTAIN FMV OF PROPERTY AS ON 01/04/1981 IS WITHOUT JURISDICTION AND INVALID. APPELLANT PRAYS TO HOLD THAT VALUATION OFFICER REPORT FOR THE SAME MAY PLEASE BE IGNOR ED AND FMV AS PER APPROVED VALUERS REPORT BE APPLIED FOR COMPUTATION OF CAPITAL GAIN. 4. THE ISSUE ARISING IN THE PRESENT APPEAL IS IN RELATION TO THE COMPUTATION OF LONG TERM CAPITAL GAINS ON SALE OF LAND AT GAT NO.101, PART 2, MAJUE WADI, SOLAPUR. TH E ASSESSEE HAS ALSO FILED AN ADDITIONAL GROUND OF APPEAL WITH REGARD TO REFERENCE TO THE VALUATION OFFICER MADE BY THE ASSESSING OFFICER FOR ASCERTAINING REFERENCE TO THE VALUATION OFFICER MADE BY THE ASSESSING OFFICER FOR ASCERTAINING THE FAIR MARKET VALUE AS ON 01.04.1981 BEING BOTH WITHOUT JURISDICTION AND INVALID. 5. BRIEFLY, IN TH E FACTS OF THE CASE, FOR THE YEAR UNDER CONSIDERATION , THE ASSESSEE HAD FILED RETURN OF INCOME DECLARING TOTAL INCOME OF RS. 17,520/ - . THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAD SOLD THE AGRICULTURAL LAND SITUATED WITHIN MUNICIPAL LIMITS OF SOLAPUR UNDER TWO SEPARATE SALE DEEDS DATED 20.02.2009 AND 21.02.2009. THE TOTAL SALE CONSIDERAT ION DECLARED BY THE ASSESSEE IN THE RETURN OF INCOME WAS RS.1,11,00,000/ - . THE ASSESSING OFFICER NOTED THAT THE ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 3 VALUE ASSESSED BY THE STAMP VALUATION AUTHORITY FOR TH E PURPOSE OF STAMP DUTY WAS RS. 1,99,57,350/ - . DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSEE OBJECTED FOR ADOPTING THE VALUE OF CONSIDERATION AS PER STAMP VALUATION AUTHORITY . H ENCE, THE ASSESSING OFFICER MADE A REFERENCE FOR THE VALU ATION OF SAID PROPERTY TO DEPARTMENTAL VALUATION OFFICER (DVO) FOR DETERMINING THE FAIR MARKET VALUE AS ON 01.04.1981 AND 20, 21/02/2009. THE VALUATION OFFICER, SOLAPUR VIDE ORDER UNDER SECTION S 55A AND 50C(2) OF THE ACT DETERMINED THE VALUE OF PROPERTY AT RS. 2,30 ,20,000/ - AS ON 20, 21/02/2009 AND RS. 2,04,000/ - AS ON 01.04.1981. THE ASSESSEE WAS SHOW CAUSED TO EXPLAIN AS TO WHY THE LONG TERM CAPITAL GAINS SHOULD NOT BE RECOMPUTED BY ADOPTING SALE CONSIDERATION AT RS. 1,99,59,350/ - AND THE FAIR MARKET VALUE AS ON 01 .04.1981 AT RS. 2,04,000/ - . THE ASSESSEE IN REPLY AT THE OUTSET, POINTED OUT THAT THE VALUE DETERMINED BY THE VALUATION OFFICER WAS BOTH NOT CORRECT AND NOT ACCEPTABLE. THE ASSESSEE POINTED OUT THAT THE VALUATION OFFICER HAD NOT GIVEN REASONABLE OPPORTUNI TY TO FILE OBJECTIONS TO HIS PROPOSED VALUATION. ANOTHER ISSUE RAISED BY THE ASSESSEE WAS THAT THE PROPERTY SOLD BY HER WAS UNDER LITIGATION AND THE SAID FACT WAS TOTALLY IGNORED BY THE ASSESSING OFFICER AND IN THIS REGARD, COPY OF MOU ENTERED INTO WITH T HE BUYERS WAS FILED. THE ASSESSING OFFICER HOWEVER, REJECTED THE CLAIM OF ASSESSEE AND IN VIEW OF PROVISIONS OF SECTION 50C(3) OF THE ACT, RECOMPUTED THE INCOME FROM CAPITAL GAINS BY TAKING THE SALE VALUE AS ASSESSED BY THE STAMP VALUATION AUTHORITY AND T HE FAIR MARKET VALUE AT RS. 2,04,000/ - . THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 54F OF THE ACT, WHICH WAS ALLOWED TO THE ASSESSEE AND THE INCOME FROM LONG TERM CAPITAL GAINS WAS DETERMINED AT RS. 1,61,39,390/ - . THE ASSESSEE ON THE OTHER HAND, HAD DISC LOSED LONG TERM CAPITAL LOSS OF RS. 1,29,690/ - . 6. THE CIT(A) FORWARDED THE SUBMISSIONS OF ASSESSEE TO THE ASSESSING OFFICER FOR HIS COMMENTS, WHO IN TURN, OBTAINED THE REPORT FROM DVO. THE DVO VIDE LETTER DATED 12.09.2012 HAS SENT HIS COMMENTS WHICH ARE REPRODUCED BY THE CIT(A) AT ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 4 PAGES 4 AND 5 OF THE APPELLATE ORDER. THE DVO STRESSED THAT THE BASIS FOR ARRIVING AT THE LAND RATE WAS AS PER ACTUAL SALE CONSIDERATION AND NOT ON THE BASIS OF STAMP VALUATION AND FURTHER, THE LAND SOLD BY THE ASSESSEE WAS NOT AGRICULTURAL LAND THOUGH IT WAS MENTIONED AS AGRICULTURAL LAND. ANOTHER POINT RAISED BY THE DVO WAS THAT IN THE SALE DEED, IT WAS MENTIONED THAT THE PROPERTY WAS TOTALLY IN THE POSSESSION OF SELLER AND WAS FREE FROM ENCUMBRANCES, LITIGATIONS, ETC. THE C IT(A) VIDE PARA 6 HELD AS UNDER: - 6. I HAVE CAREFULLY TAKEN INTO CONSIDERATION THE FACTS, ASSESSMENT ORDER, SUBMISSION OF THE APPELLANT, DVO'S LETTER DATED 12/09/2012 AND THE MATERIAL AVAILABLE ON RECORD. THE APPELLANT HAD CHALLENGED THE VALUATION OF RS. 1 ,99,59,350 / - MADE BY THE STAMP DUTY VALUATION OFFICER FOR THE PURPOSE OF PAYMENT OF STAMP DUTY. THE AO THEREFORE, IN ACCORDANCE WITH THE PROVISIONS OF SEC. 50C MADE A REFERENCE TO THE DVO TO ASCERTAIN THE FMV OF THE PROPERTY. THE DVO AFTER GIVING DUE OPPOR TUNITY TO THE APPELLANT VIDE LETTER DT. 09/09/2011 ASCERTAINED THE VALUE OF RS. 2,04,000/ - AS ON 01/04/1981 AND RS. 2,30,20,000/ - AS ON 21/02/2009. SINCE THE VALUATION OF THE DVO WAS HIGHER THAN THE VALUE ASCERTAINED BY THE STAMP DUTY VALUATION OFFICER, THE AO RIGHTLY APPLIED THE PROVISIONS OF SEC.50C(3) OF THE ACT AND DETERMINED LTCG AT RS. 1,87,72,000/ - . DURING THE APPELLATE PROCEEDINGS THE APPELLANT INVITED MY ATTENTION TO THE OBJECTIONS RAISED AGAINST THE DVO'S VALUATION. A REMAND REPORT WAS OBTAINED FROM AO. APPELLANT'S OBJECTIONS WERE FORWARDED TO DVO FOR COMMENTS. THE DVO VIDE LETTER DATED 12/09/2012 ADDRESSED TO AO HAS STATED THAT ALL THE FACTORS WERE TAKEN INTO CONSIDERATION WHILE DETERMINING FMV. A DETAILED RESPONSE OF DVO IS AT PARA 5 INTO CONSIDERATION WHILE DETERMINING FMV. A DETAILED RESPONSE OF DVO IS AT PARA 5 OF THE ORDER. I N THE FACTS AND CIRCUMSTANCES OF THE CASE, I AM OF THE CONSIDERED VIEW THAT AFTER GETTING THE COMMENTS OF THE DVO (WHO IS AN EXPERT ON THIS MATTER) ON THE OBJECTIONS OF THE APPELLANT, THERE IS NO SCOPE FOR ANY INTERFERENCE AT MY E ND, THE AO HAS CORRECTLY A PPLIED THE PROVISIONS OF SEC. 50 C OF THE ACT BY TAKING VALUE DETERMINED BY THE STAMP DUTY VALUATION AUTHORITY AS PER THE PROVISIONS OF SEC. 50 C (3) OF THE ACT. IN VIEW OF THE ABOVE, THE APPELLANT'S GROUNDS CHALLENGING THE ACTION OF THE AO ARE DISMISSED. THE LTCG CALCULATED BY THE AO IS CONFIRMED. 7. THE ASSESSEE IS IN APPEAL AGAINST THE ORDER OF CIT(A) AGAINST THE ADOPTION OF SALE CONSIDERATION AS PER STAMP VALUATION AUTHORITY AND ALSO FAIR MARKET VALUE OF THE PROPERTY AS ON 01.04.1981. 8. THE LEARNED AUTH ORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE OBJECTIONS RAISED BY THE ASSESSEE AGAINST REPORT OF THE DVO HAVE NOT BEEN TAKEN NOTE OF. THOUGH THE SALE DEED SAYS THAT THE PROPERTY WAS FREE FROM ENCUMBRANCES, BUT MOU WAS EXECUTED BETWEEN THE P ARTIES, WHICH CLEARLY MENTIONED THAT THE PROPERTY WAS NOT FREE FROM ENCUMBRANCES. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE FILED CERTAIN ADDITIONAL EVIDENCES IN ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 5 RESPECT OF DISPUTE BETWEEN THE PARTIES AND POINTED OUT THAT BECAUSE OF DISPUTE, HALF PORTION OF THE LAND WAS KEPT UNDEVELOPED AWAITING THE FINAL OUTCOME OF DISPUTE. WITH RESPECT TO THE ADDITIONAL GROUND OF APPEAL, T HE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE POINTED OUT THAT THE ISSUE RAISED WAS JURISDICTIONAL ISSUE AND THE SAME MERITS TO BE ADMITTED. IT WAS POINTED OUT BY THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE THAT IN VIEW OF RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. PUJA PRINTS (2014) 360 ITR 697 (BOM) , NO REFERENCE CAN BE MADE TO THE DVO FOR DETERMINING THE VALUE OF PROPERTY AT A LESSER VALUE. 9. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE POINTED OUT THAT NO SUCH PLEA WAS RAISED BEFORE THE CIT(A) AND HENCE, NO MERIT IN THE CLAIM OF ASSESSEE. THE LEARNED DEPARTMENTAL REPRE SENTATIVE FOR THE REVENUE PLACED RELIANCE ON THE ORDERS OF AUTHORITIES BELOW. 10. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. THE ASSESSEE FOR THE YEAR UNDER CONSIDERATION HAD SOLD HER AGRICULTURAL LAND NEAR SOLAPUR FOR TOTAL CONSIDERATIO N AT RS.1,11,00,000/ - . HOWEVER, THE VALUATION OF THE PROPERTY WAS CARRIED OUT BY THE STAMP DUTY VALUATION AUTHORITY AT RS. 1,99,57,350/ - FOR THE PURPOSE OF STAMP DUTY . THE ASSESSEE CLAIMS THAT THE SAID LAND WAS RECEIVED BY HER FROM HER DECEASED MOTHER. H OWEVER, A DISPUTE AROSE WITH THE FATHER OF ASSESSEE, WHO CLAIMS THAT HE IS SUCCESSOR TO THE EXTENT OF HALF SHARE. THE ASSESSEE FURTHER POINTED OUT BEFORE US THAT THE SAID MATTER IS SUB JUDICE IN CIVIL COURT. IN THIS REGARD, THE ASSESSEE HAS FURNISHED CER TAIN ADDITIONAL EVIDENCES. HOWEVER, THE SALE DEED EXECUTED BY THE ASSESSEE WITH THE PURCHASERS TALKS OF THE LAND BEING FREE FROM ENCUMBRANCES . B UT THERE IS AN UNDERSTANDING BETWEEN THE PARTIES, UNDER WHICH HALF PORTION OF THE LAND IS KEPT UNDEVELOPED AWA ITING THE FINAL OUTCOME OF DISPUTE. THE CLAIM OF THE ASSESSEE BEFORE US IS THAT IN VIEW OF ABOVE CIRCUMSTANCES, THE MARKET VALUE OF THE PROPERTY ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 6 WAS DEPRESSED AND THE ASSESSEE ON ITS SALE COULD F ETCH ONLY RS. 1,11,00,000/ - . HOWEVER, THE STAMP VALUATION AU THORITY HAD VALUED THE SAID PROPERTY AT RS.1.99 CRORES. 11. UNDER THE PROVISIONS OF SECTION 50C OF THE ACT, IT IS PROVIDED THAT WHERE ANY IMMOVABLE PROPERTY BEING LAND OR BUILDING OR BOTH, IS SOLD BY A PERSON AND THE VALUE WHICH IS ADOPTED BY THE STAMP VA LUATION AUTHORITY FOR THE PURPOSE OF PAYMENT OF STAMP DUTY IS HIGHER THAN THE VALUE AS DECLARED BY THE ASSESSEE IN THE DOCUMENTS OF TRANSFER, THEN SUCH VALUE DETERMINED BY THE STAMP VALUATION AUTHORITY IS TO BE ADOPTED FOR WORKING OUT THE INCOME FROM LONG TERM CAPITAL GAINS. SECTION 50C(2) OF THE ACT FURTHER PROVIDES THAT IN CASE THE ASSESSEE RAISES ANY OBJECTION AGAINST THE SAID VALUATION ADOPTED BY THE STAMP VALUATION AUTHORITY BEFORE THE ASSESSING OFFICER AND WHERE THE ASSESSEE HAS NOT FILED ANY APPEAL OR ANY PROCEEDINGS AGAINST THE VALUATION DETERMINED BY THE STAMP VALUATION AUTHORITY, THEN THE STATUT E REQUIRE S THAT THE ASSESSING OFFICER WAS TO REFER THE AUTHORITY, THEN THE STATUT E REQUIRE S THAT THE ASSESSING OFFICER WAS TO REFER THE MATTER TO THE DVO TO DETERMINE THE MARKET VALUE OF PROPERTY AS ON DATE OF SALE. THE DUTY OF THE DVO IS TO PROVIDE AN OPPORTUNITY OF HEARING TO THE ASSESSEE BEFORE FINALIZING THE VALUATION OF PROPERTY. THE DVO IS ALSO TO CONSIDER THE VARIOUS ASPECTS OF THE SAID PROPERTY WHICH C OULD HAVE BEARING ON ITS MARKET VALUE. THE PERUSAL OF ASSESSMENT REFLECTS TH AT THOUGH THE DVO HAD ASKED THE ASSESSEE TO APPEAR AND FILE HER SUBMISSIONS, BUT PROCEEDINGS COULD NOT BE ATTENDED BY THE ASSESSEE BECAUSE OF CERTAIN CONSTRAINTS. THE VALUATION REPORT PREPARED BY THE DVO WAS APPLIED BY THE ASSESSING OFFICER. THE ASSESSE E FURTHER FILED OBJECTIONS BEFORE THE CIT(A) AND POINTED OUT THAT THE ISSUE AND DISPUTE BETWEEN THE PARTIES WHICH HAD A FFECTED ITS MARKET VALUE ; BUT ALL THESE ISSUES WERE NOT CONSIDERED BY ANY OF THE AUTHORITIES. IN THE TOTALITY OF THE ABOVE SAID FACTS AN D CIRCUMSTANCES AND FOLLOWING THE PRINCIPLES OF NATURAL JUSTICE, WE DEEM IT FIT TO RESTORE THE ISSUE OF VALUATION OF PROPERTY AS ON DATE OF SALE , BACK TO THE FILE OF ASSESSING OFFICER, WHO ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 7 SHALL OBTAIN THE REPORT FROM THE DVO, WHO IN TURN, SHALL AFFORD REA SONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE BEFORE FINALIZING THE VALUATION OF AFORESAID PROPERTY. ACCORDINGLY, THE MATTER IS SET - ASIDE TO THE FILE OF ASSESSING OFFICER TO COMPLETE THE PROCEEDINGS OF DETERMINATION OF VALUE OF PROPERTY AS ON THE DATE OF SALE BY OBTAINING THE REPORT FROM DVO DE NOVO ON THIS ACCOUNT. THE DVO IS DIRECTED TO CONSIDER VARIOUS ISSUES RAISED BY THE ASSESSEE BEFORE US AND DETERMINE THE MARKET VALUE IN ACCORDANCE WITH LAW. THE ASSESSING OFFICER SHALL THEN COMPUTE INCOME FROM LO NG TERM CAPITAL GAINS IN ACCORDANCE WITH LAW. 12. NOW, COMING TO THE ADDITIONAL GROUND OF APPEAL RAISED BY THE ASSESSEE I.E. REFERENCE TO THE DVO FOR DETERMINING THE FAIR MARKET VALUE OF PROPERTY AS ON 01.04.1981. THE ASSESSEE HAD DECLARED THE VALUE OF S AID PROPERTY HIGHER THAN THE VALUE AS DETERMINED BY THE DVO. THE ADDITIONAL GROUND OF APPEAL RAISED BY THE ASSESSEE BEING PURELY LEGAL , IS ADMITTED FOR ADJUDICATION. 13. THE ISSUE WHICH ARISES BEFORE US IS THAT WHETHER ANY REFERENCE COULD BE MADE TO TH E DVO TO DETERMINE THE FAIR MARKET VALUE AT VALUE WHICH WAS LESSER THAN THE VALUE DECLARED BY THE ASSESSEE , WHILE COMPUTING THE INCOME FROM LONG TERM CAPITAL GAINS. THE OBJECTION RAISED BY THE ASSESSEE WAS AGAINST THE REFERENCE TO DVO UNDER SECTION 55A OF THE ACT TO DETERMINE THE FAIR MARKET VALUE AS ON 01.04.1981. UNDER THE PRE - AMENDED PROVISIONS OF SECTION 55A OF THE ACT WITH A VIEW TO ASCERTAIN THE FAIR MARKET VALUE OF A CAPITAL ASSET, THE ASSESSING OFFICER IS EMPOWERED TO REFER THE VALUATION OF CAPITA L ASSET TO A VALUATION OFFICER UNDER CLAUSE (A) IN CASE WHERE THE VALUE OF AN ASSET AS CLAIMED BY THE ASSESSEE IS IN ACCORDANCE WITH ESTIMATE MADE BY THE REGISTERED VALUER AND WHERE THE ASSESSING OFFICER WAS OF THE OPINION THAT THE VALUE SO CLAIMED IS LESS THAN ITS MARKET VALUE. CLAUSE (B) REFERS TO CASES WHICH WERE OTHER THAN CLAUSE (A) I.E. WHERE THE VALUE OF AN ASSET DECLARED BY THE ASSESSEE WAS NOT IN ACCORDANCE WITH THE REPORT OF A REGISTERED VALUER. IN THE FACTS OF PRESENT CASE, THE ASSESSEE HAD ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 8 DEC LARED THE FAIR MARKET VALUE AS ON 01.04.1981 ON THE BASIS OF REGISTERED VALUER REPORT AND THE SAME IS UNDISPUTED, HENCE, IN THE PRESENT CASE, PROVISIONS OF CLAUSE (A) TO SECTION 55A OF THE ACT ARE ATTRACTED. THE PRE - AMENDED PROVISIONS OF SAID CLAUSE VERY CLEARLY PROVIDED THAT A REFERENCE COULD BE MADE TO THE VALUATION OFFICER ONLY IN CASES WHERE THE ASSESSING OFFICER WAS OF THE OPINION THAT THE VALUE SO CLAIMED BY THE ASSESSEE WAS LESS THAN ITS FAIR MARKET VALUE. IN THE INSTANT CASE, THE REGISTERED VALUER HAD WORKED OUT THE VALUE OF PROPERTY AT RS.19,29,500/ - , WHEREAS THE DVO HAS WORKED OUT THE VALUE OF PROPERTY AT RS. 2,04,000 / - . CONSEQUENTLY, WHERE THE VALUE AS DETERMINED BY THE DVO WAS LESSER THAN THE VALUE AS DECLARED BY THE ASSESSEE AS ON 01.04.1981, THEN THE REFERENCE TO THE DVO UNDER SECTION 55A OF THE ACT IS NOT WARRANTED. IN THIS REGARD, WE FIND SUPPORT FROM THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. PUJA PRINTS (SUPRA), WHEREIN IT HAS BEEN HELD THAT WHERE THE ASSESSING OFFICE R REFERRED THE ISSUE OF VALUATION TO THE DVO ONLY BECAUSE IN HIS VIEW, THE VALUATION OF THE PROPERTY AS ON 01.04.1981 AS MADE BY THE RESPONDENT - ASSESSEE WAS HIGHER THAN THE FAIR MARKET VALUE, THUS, IN SUCH CASES, INVOCATION OF SECTION 55A OF THE ACT WAS NO T JUSTIFIED. THE HONBLE HIGH COURT FURTHER HELD THAT THE AMENDMENT TO SECTION 55A OF THE ACT IN 2012 WAS MADE EFFECTIVE FROM 01.07.2012 AND HENCE, WAS TO BE APPLIED PROSPECTIVELY. IT WAS FURTHER HELD THAT WHERE THE ISSUE WAS COVERED BY SECTION 55A [CLAU SE (A)] OF THE ACT, RESORT COULD NOT BE MADE TO THE RESIDUARY CLAUSE PROVIDED IN SECTION 55A(B)(II) OF THE ACT. THE CBDT CIRCULAR DATED 25.11.1972 WAS HELD TO BE NOT APPLICABLE. FOLLOWING THE ABOVE SAID PROPOSITION AS LAID DOWN BY THE JURISDICTIONAL HIGH COURT AND APPLYING THE SAME TO THE FACTS OF THE PRESENT CASE, IN THE INSTANT CASE ALSO, REFERENCE WAS MADE TO THE VALUATION OFFICER IN ORDER TO DETERMINE THE FAIR MARKET VALUE AS ON 01.04.1981 ON THE PRETEXT THAT THE FAIR MARKET VALUE AS DECLARED BY THE A SSESSEE WHICH WAS BACKED BY REGISTERED VALUER REPORT, WAS HIGHER, WHICH IS NOT CORRECT. ITA NO . 547 /PN/20 1 3 MRS. ANJALI BHARAT KABRA 9 14. THE ISSUE RAISED IN THE PRESENT APPEAL IS SQUARELY COVERED BY THE RATIO LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN CIT VS. PUJA PRINTS (SUPRA) AND FOLLOWING THE SAME PARITY OF REASONING, WE FIND NO MERIT IN DETERMINATION OF FAIR MARKET VALUE AS ON 01.04.1981 BY THE DVO THAN THE VALUE AS DECLARED BY THE ASSESSEE AS ON 01.04.1981 APPLIED FOR DETERMINING THE INCOME FROM CAPITAL GAINS IN THE HANDS OF ASSESSEE. REVER SING THE ORDER OF CIT(A), THE ADDITIONAL GROUND OF APPEAL RAISED BY THE ASSESSEE IS ALLOWED. 1 5 . IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED AS INDICATED ABOVE . ORDER PRONOUNCED ON THIS 26 TH DAY AUGUST , 201 6 . SD/ - SD/ - ( R.K. PANDA ) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; D ATED : 26 TH AUGUST , 201 6 . / PUNE ; D ATED : 26 TH AUGUST , 201 6 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPELLANT ; 2. / THE RESPONDENT; 3. ( ) / THE C I T (A) - II , NASHIK ; 4. / THE C I T - I I, NASHIK ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER , // TRUE COPY // / SR. PRIVATE SECRETARY , / ITAT, PUNE