ITO, Lucknow V. Anil Kumar Gupta, Lucknow

ITA 570/LKW/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 9171 (ITAT-LUCKNOW)
• Duration Of Justice: 4 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-01-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 18-01-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 01-09-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: J J MEHROTRA
• Keywords: Sale consideration of property below Jantri Value; Value adopted by valuation officer; Capital asset; Opportunity of being heard; Cost of acquisition; Fair market value
• Section: 143(3); 50C; 2(14); 147; 148; 263

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, A - BENCH, LUCKNOW. BEFORE SHRI H.L.KARWA, HON'BLE VICE PRESIDENT AND SHRI N.K.SAINI, ACCOUNTANT MEMBER I.T.A.NO.570 (LKW.)/2010 A.Y. : 2004-05 THE ITO-II(1), VS. ANIL KUMAR GUPTA, LUCKNOW. M-28, GOLE MARKET, MAHANAGAR,LUCKNOW PAN ADFPG3141A (APPELLANT) (RESPONDENT) C.O.NO.46 (LKW.)/2010 (IN I.T.A.NO.570(LKW.)/2010) A.Y. : 2004-05 ANIL KUMAR GUPTA, VS. THE ITO II(1), LUCKNOW. LUCKNOW. (CROSS OBJECTOR) (RESPONDENT) REVENUE BY : SHRI PRAVEEN KUMAR, CIT(D.R.) ASSESSEE BY : SHRI J.J.MEHROTRA, C.A. O R D E R PER H.L.KARWA, VICE PRESIDENT THE APPEAL BY THE REVENUE AND THE CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDER OF THE LD.CIT(A)-I, LUCKNOW DATED 9.6.2010 RELATING TO THE ASSESSMENT YEAR 2004-05. 2. IN THIS APPEAL, THE REVENUE HAS TAKEN THE FOLLOW ING GROUNDS : 1. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN NO T ACCEPTING THE CORRECT APPLICATION OF SECTION 50C OF THE I.T.ACT B Y THE A.O. FOR 2 COMPUTATION OF LONG TERM CAPITAL GAIN. 2. THE LD. CIT(A) HAS ERRED IN LAW AND FACTS IN HOL DING THAT THE A.O. WAS UNDER LEGAL OBLIGATION TO COMPUTE THE CAPI TAL GAINS IN ACCORDANCE WITH THE VALUATION MADE BY THE D.V.O. DE SPITE THE FACT THAT THE D.V.O. HIMSELF MENTIONED THAT HE IS N OT COMPETENT TO VALUE THE AGRICULTURAL LAND. 3. THE LD.CIT(A) HAS ERRED IN LAW AND FACTS IN DIRE CTING TO COMPUTE THE INDEXED COST OF ACQUISITION AS ON 1.04. 1981 AS DETERMINED BY D.V.O. AGAINST THE D.M.'S CIRCLE R ATE AS ADOPTED BY A.O. BEING THE LAND WAS SITUATED WITHIN THE MUNICIPAL LIMITS OF LUCKNOW. 4. ANY OTHER GROUND THAT MAY ARISE OR BECOMES INCID ENTAL DURING THE PENDENCY OF APPEAL. 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT T HE ASSESSEE FILED HIS RETURN OF INCOME ON 11.8.2004 DECLARING TOTAL INCOME OF R S.69,552. A CAPITAL LOSS OF RS.5,64,429 WAS ALSO SHOWN IN COMPUTATION OF IN COME ENCLOSED WITH THE RETURN. THE RETURN WAS PROCESSED UNDER SECTION 14 3(1) OF THE INCOME-TAX ACT,1961 (IN SHORT THE ACT). LATER ON, A NOTICE U NDER SECTION 148 OF THE ACT WAS ISSUED AND SERVED ON THE ASSESSEE ON 27.3. 2009. THE REOPENING PROCEEDINGS WERE INITIATED ON THE GROUND THAT M/S. OMAX PROPERTIES, LUCKNOW HAS PURCHASED 10.896 HECTARES OF LAND FROM SIX CO-OWNERS, NAMELY (I) SRI SUBHAGMAL JAIN, (II) SRI SURAJ KUMAR GUPTA,(III) SHRI SHYAM GUPTA (IV) SRI ANIL KUMAR GUPTA, (VI) SRI PRAVEEN K UMAR JAIN AND (VI) SHRI SANDEEP KUMAR JAIN. THE TOTAL NOMINAL VALUE WAS SHO WN TO RS.2.40 CRORES, WHERE AS PER DISTRICT MAGISTRATE CIRCLE RATE STAMP DUTY WAS PAID ON A TOTAL VALUATION OF RS.13 CRORES. THE BALANCE AMOUNT OF R S.10.60 WAS PAID PURPORTEDLY IN THE RATE OF OWNERSHIP AND IN THE INS TANT CASE OF THE ASSESSEE ONE-EIGHT SHARE AMOUNTED TO RECEIPT OF APPROXIMATEL Y RS.1.30 CRORES. IN 3 RESPONSE TO THE NOTICE UNDER SECTION 148 OF THE ACT , THE ASSESSEE STATED THAT THE INCOME-TAX RETURN FOR ASSESSMENT YEAR 2004-05 W AS FILED ON 11.8.2004 AND THE SAME MAY BE TREATED AS HIS RETURN FILED IN RESPONSE TO NOTICE UNDER SECTION 148 OF THE ACT. AS ALREADY STATED, IN THE RETURN OF INCOME, TOTAL INCOME WAS SHOWN AT RS.69,552. THE COPY OF THE RE ASONS RECORDED FOR INITIATING PROCEEDINGS U/S 147 WAS REQUESTED FROM THE AO, WHICH WAS DULY SUPPLIED TO THE ASSESSEE. THE AO REFERRED TO SOME T RANSACTION ENTERED INTO WITH M/S. OMAXE PROPERTIES LIMITED AND TREATED THE ASSESSEE TO BE THE OWNER OF 1/8 TH SHARE IN RESPECT OF THE PROPERTY SOLD TO OMAXE PR OPERTIES LIMITED. HE FORMED A BELIEF THAT THE INCOME CHARGE ABLE TO TAX HAS ESCAPED ASSESSMENT. THE PROPERTY WAS PURCHASED BY M/S.R.M.C .TECHNO BUILD. PVT. LTD. AS PER THE SALE DEED FILED BY THE ASSESSEE ALO NGWITH THE RETURN OF INCOME. IN SUPPORT OF THE INCOME SHOWN IN THE RETU RN, THE ASSESSEE CONTENDED BEFORE THE AO THAT THE LAND IN QUESTION WAS IN THE NATURE OF AGRICULTURAL LAND AND THAT SINCE THE LAND WAS IN T HE MUNICIPAL LIMIT OF NAGAR NIGAM DUE TO THE FACT THAT THE PURCHASER BEING A DE VELOPER STAMP DUTY HAS BEEN PAID AT THE RESIDENTIAL RATES BY THEM, THEREFO RE, THE SALE CONSIDERATION TAKEN FOR THE PURPOSE OF STAMP DUTY AS PER THE PROV ISION OF 50C(1) OF THE I.T. ACT SHOULD NOT BE TAKEN AS THE SALE CONSIDERATION F OR THE LONG TERM CAPITAL GAIN PURPOSES. IT WAS FURTHER SUBMITTED THAT THE CO -OWNERS OF THE SAID PROPERTY I.E. SRI LATE SUBHAGMAL JAIN AND SRI SURAJ KUMAR GUPTA HAVE ALSO SOLD THEIR SHARES TO THE SAME PURCHASER AND IN THEI R CASES FOR THE ASSESSMENT YEAR 2004-05, THE APPLICABILITY OF PROVISIONS OF S ECTION 50C(1) WAS THOROUGHLY EXAMINED AND EVEN THE VALUATION OF THE S AID SOLD PROPERTIES WERE REFERRED BY THE AO TO THE DVO AND THE DVO VALUED TH EIR SHARE OF SOLD LAND AT RS.8.80 LACS PER ACRE. AFTER RECEIVING THE DVO REPORT, SALE CONSIDERATION SHOWN IN THE SALE DEED WAS ACCEPTED AND THE CASES W ERE COMPLETED UNDER 4 SECTION 143(3) OF THE ACT AND THEREFORE, SECTION 50 C(1)IS NOT APPLICABLE IN THE PRESENT CASE . SO THE NOTICE U/S 148 MAY BE QUA SHED. THE AO CONSIDERED THE ABOVE REPLY OF THE ASSESSEE AND OBSERVED THAT THE MAIN ASSERTION OF THE ASSESSEE WAS THAT THE RATES ADOPTED AS PER THE VALU ATION REPORT IN THE CASES OF THE CO-OWNERS WERE APPLICABLE IN HIS CASE AND BINDI NG ON THE ASSESSING OFFICER. IN THE CASES OF CO-OWNERS THE LD. CIT-I, L UCKNOW VIDE HIS ORDER U/S 263 OF THE I.T.ACT, 1961 DATED 27/03/2009 HAS SET A SIDE THE SAID ASSESSMENT ORDERS IN THEIR CASES AND DIRECTED THE AO TO COMPLE TE THE ASSESSMENT DE- NOVO AFTER MAKING NECESSARY INQUIRIES AND AFTER G IVING THE ASSESSEE AN ADEQUATE OPPORTUNITY OF BEING HEARD. THE AO, THERE FORE, HELD THAT IN THE LIGHT OF ABOVE FACTS, THERE REMAINS NO RELEVANCE TO THE ORDER OF THE ASSESSING OFFICER U/S 143(3) AND OF THE CONTENTION OF THE ASS ESSEE. THE AO FURTHER HELD THAT THE SAID REPORT OF THE DVO IN THE CASES OF CO -OWNERS HAD BEEN CONSIDERED WHILE PASSING THE ASSESSMENT ORDER UNDER SECTION 143(3)/263 OF THE ACT AND HAS BEEN REJECTED BEING ADVISORY IN NA TURE. THE ASSESSMENT WAS FINALLY COMPLETED BY THE AO UNDER SECTION 143(3) /148 OF THE ACT. FOR THE DETAILED REASONS GIVEN IN THE ASSESSMENT ORDER, THE AO HAS HELD THAT THE VALUE ADOPTED FOR THE PURPOSE OF STAMP DUTY IS TO B E DEEMED AS FULL VALUE OF SALE CONSIDERATION AS A RESULT OF THE TRANSFER OF CAPITAL ASSET. HE ACCORDINGLY ADOPTED THE SALE VALUE ON THE BASIS OF THE VALUE T AKEN FOR STAMP DUTY PURPOSES AND HAS COMPUTED THE LONG TERM CAPITAL GA INS ON THE SAID BASIS. 4. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE C ARRIED THE MATTER IN APPEAL BEFORE THE LD.CIT(A). BEFORE THE LD.CIT(A), IT WAS SUBMITTED BY THE ASSESSEE THAT THE I.T.A.T., LUCKNOW BENCH VIDE ORDE R DATED 30.6.2009 IN I.T.A.NOS.223 AND 224(LUC.)/2009 FOR THE ASSESSMENT YEAR 2004-05 IN THE CASE OF CO-OWNERS OF THE PROPERTY IN QUESTION, NAME LY, SHRI S.K.GUPTA AND 5 SHRI S.JAIN (CO-OWNERS OF PROPERTY) HAVE HELD THAT THE ORDER OF THE LD.CIT, LUCKNOW DATED 27.3.2009 PASSED UNDER SECTION 263 OF THE ACT WAS NOT THE CORRECT ORDER AND THE ORDER OF THE AO PASSED IN THESE TWO CASES WAS HELD TO BE A VALID ORDER IN ACCORDANCE WITH LAW. ACCORDINGL Y, IT WAS SUBMITTED BY THE ASSESSEE BEFORE THE LD.CIT(A) THAT THE FACTS OF THE CASE BEING IDENTICAL TO THOSE TWO CASES,THERE WAS NO OCCASION AND JUSTIFICA TION FOR THE AO TO TAKE A DIFFERENT VIEW THAN THE VIEW TAKEN BY THE LD.AO.IN THESE TWO CASES FOR THE SAME ASSESSMENT YEAR. 5. KEEPING IN VIEW THE ABOVE SUBMISSIONS OF THE ASS ESSEE, THE LD.CIT(A) HELD AS UNDER : 5.3 I HAVE CAREFULLY CONSIDERED THE SUBMISSIONS/A RGUMENTS OF THE LD. AR FOR THE APPELLANT AS WELL AS THE WRITTEN SUB MISSIONS FILED AND HAVE ALSO PERUSED THE ASSESSMENT ORDER. I FIND THAT THE CORE ISSUE INVOLVED IN THE APPELLANT'S CASE IS THAT THE AO HAS ADOPTED THE VALUE OF THE LAND FOR STAMP DUTY PURPOSES AS THE DEEMED FULL VALUE OF SALE CONSIDERATION FOR THE PURPOSES OF WORKING OUT CAPIT AL GAINS ARISING ON THE TRANSFER OF LAND, WHEREAS THE APPELLANT'S CLAIM IS THAT THE FAIR MARKET VALUE OF THE PROPERTY IS LESS THAN THE VALUE ADOPTED BY THE STAMP DUTY AUTHORITY AND ACCORDINGLY THE AO WAS OBL IGED TO REFER THE SAID PROPERTY FOR VALUATION TO THE DVO AS MANDA TED BY SECTION 50C(2) OF THE ACT. THE ISSUE RELATED TO THIS CORE I SSUE IS THE NATURE OF THE LAND SOLD BY THE APPELLANT AND OTHER CO-OWNERS - AS TO WHETHER THE SAME IS AGRICULTURAL IN NATURE. 5.3.1 I FIND THAT THERE IS NO DOUBT THAT THE LAND SOLD BY THE APPELLANT WAS AN AGRICULTURAL LAND SITUATED WITHIN THE MUNICI PAL LIMITS OF LUCKNOW. THIS IS ALSO EVIDENT FROM THE SALE DEED AN D THE ORDER OF SDM, SADAR, LUCKNOW DATED 19.02.2007 U/S 143 OF U.P .ZA & LR ACT, IN WHICH IT HAS BEEN MENTIONED THAT THE LAND B EING SOLD IS AN AGRICULTURAL LAND AS WELL AS BARREN LAND. SINCE THE APPELLANT ALONGWITH 5 OTHER CO-OWNERS HAVE SOLD 10.89 HECTARE LAND, THE RE IS ALWAYS A POSSIBILITY THAT SOME PART WAS BARREN AND MOST OF I T WAS AGRICULTURAL. THE DVO AFTER DUE INSPECTION HAS ALSO MENTIONED IN HIS REPORT THAT 6 THIS WAS AN AGRICULTURAL LAND; THEREFORE, THE STATU S OF THE LAND BEING AN AGRICULTURAL CANNOT BE DOUBTED. IT IS ALSO EVIDENT FROM THE ABOVE SAID ORDER PASSED BY SDM, SADAR, LUCKNOW THAT THE LAND U SE OF THE SAID LAND HAS BEEN CHANGED FROM 'AGRICULTURAL' TO 'NON A GRICULTURAL' ON 19.2.2007 BY THE ORDER OF THE SDM, SADAR, LUCKNOW P ASSED U/S 143 OF ZALR ACT THE COPY OF THE KHATAUNI MENTIONING THE EX TRACT OF THE SDM'S ORDER HAS BEEN PLACED ON RECORD. BASED ON THE SE FACTS, THERE APPEARS TO BE NO TWO OPINIONS ABOUT THE NATURE OF L AND SOLD BY THE APPELLANT AND OTHER CO-OWNERS, WHICH IS OBVIOUSLY A GRICULTURAL IN NATURE AS ON THE SALE OF DATE, AS ITS LAND USE WAS CHANGED TO NON- AGRICULTURAL ONLY ON 19.2.2007. 5.3.2 COMING NOW TO THE APPLICABILITY OF SECTION 50 C(2) OF THE ACT, I FIND SUFFICIENT MERIT IN THE SUBMISSIONS OF THE LD. AR THAT, WHERE IT IS CLAIMED BEFORE THE AO THAT THE VALUE ADOPTED OR ASS ESSED BY THE STAMP VALUATION AUTHORITY EXCEEDS THE FAIR MARKET V ALUE OF THE PROPERTY AS ON THE DATE OF TRANSFER, THE AO IS UNDE R LEGAL OBLIGATION TO REFER THE VALUATION OF THE CAPITAL ASSET TO THE DVO . IT APPEARS TO ME THAT IT IS BECAUSE OF THIS LEGAL OBLIGATION THAT TH E AO RIGHTFULLY REFERRED THE VALUATION OF THE CAPITAL ASSET IN QUESTION TO T HE VALUATION OFFICER. THE VALUATION OFFICER INITIALLY EXPRESSED THE VIEW THAT THE LAND IN QUESTION WAS AGRICULTURAL IN NATURE, WHICH VIEW WAS BASED WITHOUT CONSIDERING THE FACT THAT THE LAND, THOUGH AGRICULT URAL, WAS SITUATED WITHIN THE MUNICIPAL LIMITS OF LUCKNOW AND THUS CON STITUTED A CAPITAL ASSET WITHIN THE MEANING OF SECTION 2(14) OF THE AC T. THERE IS NOT MUCH SUBSTANCE IN THE OBSERVATION OF THE AO THAT TH E REPORT OF THE DVO IS NOT STATUTORY SINCE THE SAME HAS BEEN STATED TO BE 'ADVISORY' IN NATURE BY THE DVO. THE AO HAS DISREGARDED THE PROVI SIONS OF SECTION 50C(2) OF THE ACT, WHEREBY REFERENCE TO THE VALUATI ON OFFICER WAS MANDATORY IN THE CASE OF THE APPELLANT (AND OTHER C O-OWNERS) AND THE AO WAS ALSO UNDER LEGAL OBLIGATION TO COMPUTE CAPIT AL GAINS IN ACCORDANCE WITH THE VALUATION ASSESSED BY THE VALUA TION OFFICER. I DO NOT SEE ANY JUSTIFICATION IN THE ACTION OF THE AO I N NOT ACCEPTING THE VALUATION ASSESSED BY THE OVO, AFTER HAVING HIMSELF MADE THE STATUTORY REFERENCE TO HIM AS PER SECTION 50C(2) OF THE ACT. 5.3.3. I FIND THAT THE OVO VIDE HIS REPORT DATED 1 3.09.2006 HAS ASSESSED THE VALUATION OF THE LAND AT RS.8.80 LAKHS PER ACRE. IT IS ALSO SEEN FROM THE MATERIAL AVAILABLE ON RECORD THAT THE SAME WAS ACCEPTED IN THE CASE OF TWO CO-OWNERS (LATE SHRI SAUBHAGMAL JAIN & SHRI SURAJ 7 KUMAR GUPTA) WHILE COMPLETING THEIR ASSESSMENTS U/S 143(3) OF THE ACT (ALTHOUGH THESE SCRUTINY ASSESSMENTS WERE LATER SET-ASIDE BY THE CIT-I, LUCKNOW U/S 263 OF THE ACT). IT IS ALSO SEEN THAT, LATER ON, THE ASSESSMENTS SET ASIDE BY THE COMMISSIONER OF INCOME TAX-I, LKO U/S 263 IN THE CASE OF THE ABOVE TWO CO-OWNERS HAVE BEE N QUASHED BY THE HON'BLE ITAT VIDE ORDER DATED 30.6.2009. THE HON'BL E ITAT IN THE CASE OF THESE TWO CO-OWNERS (SRI SURAJ KUMAR GUPTA & SRI SAUBHAG MAL JAIN) IN THE ORDER DATED 30-06-09 AT PAGE 51 & 52 HAVE HELD AS UNDER: 9.9. COMING TO THE VALUATION PART OF THE PROPERT Y, SINCE THE DVO DETERMINED THE FAIR MARKET VALUE OF THE SAME AT RS.59.30 LAKHS WHICH WAS BELOW THE SALE PRICE SHOWN BY THE A SSESSEE AND OTHERWISE WAS BINDING ON THE AO BY VIRTUE OF APPLIC ABILITY OF PROVISION OF SEC 16A(6) WHICH HAS BEEN APPLICABLE T O THE REFERENCE MADE IN ACCORDANCE TO SUB SEC (2) OF SEC 50C OF THE ACT; MEANING THEREBY THAT THE AO AFTER HAVING PREFE RRED TO EXERCISE HIS JURISDICTION UNDER SUB-SECTION (2) OF SEC 50C OF THE ACT AND THE DVO HAVING DETERMINED THE FAIR MARKET V ALUE OF THE PROPERTY ON THE DATE OF TRANSFER AT RS.59.30 LA KHS, WAS LEFT WITH NO CHOICE BUT TO MAKE THE ASSESSMENT IN ACCORD ANCE WITH THE VALUE DETERMINED BY THE DVO I.E. THE AO WAS BOU ND TO ADOPT THE FAIR MARKET VALUE OF PROPERTY ON THE DATE OF TRANSFER AT RS 59.30 LAKHS'. THUS, THE HON'BLE ITAT HAVE HELD THAT THE AO HAS NO CHOICE BUT TO MAKE THE ASSESSMENT IN ACCORDANCE WITH THE VALUE DE TERMINED BY THE DVO, I.E. THE AO WAS BOUND TO ADOPT THE FAIR MARKET VALUE OF PROPERTY ON THE DATE OF TRANSFER AT RS.59.30 LAKHS, I. E. AT THE RATE OF RS.8.80 LAKHS PER ACRE. IT HAS BEEN CLEARLY HELD TH AT THE DVO'S REPORT WAS BINDING ON THE AO BY VIRTUE OF APPLICABILITY OF PROVISION OF SECTION 16A(6) WHICH HAS BEEN MADE APPLICABLE TO TH E REFERENCE MADE IN ACCORDANCE WITH SUB-SECTION (2) OF SEC 50C OF TH E ACT. 5.3.4 I HAVE ALSO TAKEN NOTE OF THE FACT THAT AS P ER THE CERTIFICATE DATED 16.3.2006 ISSUED BY THE ASSTT. STAMP OFFICER OF THE DISTRICT MAGISTRATE LUCKNOW THE DM CIRCLE RATE FOR AGRICULTU RAL LAND IN THE CITY AREA FROM 1.4.2002 TO 16.6.2004 WAS RS.8 LAKH PER ACRE; THE COPY OF THE SAID CERTIFICATE IS PLACED ON RECORD. 8 5.3.5. I HAVE ALSO CAREFULLY CONSIDERED THE SUBMIS SION OF THE ID. AR THAT THE OTHER CO-OWNERS OF THE LAND HAVE PARTLY SO LD LAND TO M/S. TANISHA BUILDERS PVT. LTD WHO SOLD 5.132 HECTARE OF LAND TO M/S. OMAXE LTD.ON 24.2.2007 FOR A TOTAL CONSIDERATION OF RS.1,68,39,197/-; THUS THE FAIR MARKET VALUE OF THE LAND SOLD BY TAN ISHA BUILDERS PVT. LTD. AFTER ABOUT 3 YEARS FROM THE DATE OF TRANSFER OF LAND IN THE CASE OF THE APPELLANT WAS RS.13.67 LAKHS PER ACRE. ACCORDIN GLY, THERE IS MERIT IN THE SUBMISSION THAT THE FAIR MARKET RATE OF THE SAID LAND IN THE F.Y. 200304 COULD NOT BE MORE THAN RS.8 LAKHS PER ACRE. THERE IS ALSO AN APPARENT INCONSISTENCY IN THE LEVY OF STAMP DUTY @ RS.687/- PER SQ/MT IN FEB, 2007 BY THE STAMP DUTY AUTHORITY, AS COMPAR ED TO THE APPLICATION OF THE RATE OF 1,150/- PER SQ/MT IN FEB , 2004 IN THE CASE OF THE APPELLANT (AND OTHER CO-OWNERS). 5.3.6 IN THE LIGHT OF ABOVE FACTS, I AM OF THE CON SIDERED VIEW THAT THE FAIR MARKET VALUE OF THE PROPERTY ON THE DATE OF TR ANSFER SHOULD NOT EXCEED THE VALUE GIVEN BY THE OVA I.E. RS.8.80 LAKH S PER ACRE. I, THEREFORE, DIRECT THE AO TO ADOPT THE FAIR MARKET V ALUE AT THE RATE OF RS.80 LAKHS PER ACRE IN RESPECT OF THE 1/8TH SHARE OF THE APPELLANT IN THE AGRICULTURAL LAND, AND COMPUTE THE FAIR MARKET VALUE FOR THE PURPOSE OF SEE 50C(2) OF THE I.T. ACT, 1961 ACCORDI NGLY ( THE ACTUAL SALE CONSIDERATION SHOWN BY THE APPELLANT FOR HIS S HARE IS RS.30,00,000/-). THE AO IS ALSO DIRECTED TO ADOPT T HE RATE OF RS.4.35 PER SQ.FT FOR WORKING OUT THE INDEXED COST OF ACQUI SITION AS ON 1.4.1981, IN TERMS OF THE RATE SO DETERMINED BY THE DVO. THE AO IS DIRECTED TO COMPUTE THE CAPITAL GAINS ACCORDINGLY. 6. WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE ALS O PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS OBSERVED THAT THE DVO HAS ESTIMATED THE VALUE OF THE LAND AT RS.8.80 LACS PER ACRE. WE FIN D THAT THE REPORT OF THE DVO HAS BEEN ACCEPTED IN THE CASE OF TWO CO-OWNERS (LATE SHRI SAUBHAGMAL JAIN AND SHRI S.K.GUPTA) WHILE COMPLETING THEIR ASS ESSMENTS UNDER SECTION 143(3) OF THE ACT. IT IS RELEVANT TO STATE THAT TH E CASES OF TWO CO-OWNERS WERE LATER ON SET ASIDE BY THE LD.CIT-I, LUCKNOW UN DER SECTION 263 OF THE ACT. IT IS ALSO OBSERVED THAT LATER ON THE ASSESSM ENTS SET ASIDE BY THE LD.CIT- I, LUCKNOW UNDER SECTION 263 OF THE ACT IN THE CAS E OF ABOVE TWO CO- 9 OWNERS WERE QUASHED BY THE TRIBUNAL VIDE ITS ORDER PASSED IN I.T.A.NOS.223(LUC.)/2009 AND I.T.A.NO.224(LUC.)/200 9 RELATING TO ASSESSMENT YEAR 2004-05 VIDE ORDER DATED 30.6.2009. THE TRIBUNAL IN THE CASE OF THESE TWO CO-OWNERS HELD AS UNDER : 9.9 COMING TO THE VALUATION PART OF THE PROPERTY, SINCE THE DVO DETERMINED THE FAIR MARKET VALUE OF THE SAME AT RS. 59.30 WHICH WAS BELOW THE SALE PRICE SHOWN BY THE ASSESSEE AND OTHE RWISE WAS BINDING ON THE AO BY VIRTUE OF APPLICABILITY OF PROVISIONS OF SECTION 16A(6) WHICH HAS BEEN MADE APPLICABLE TO THE REFERENCE MAD E IN ACCORDANCE WITH SUB-SECTION (2)OF SECTION 50C OF THE ACT; MEAN ING THEREBY THAT THE AO AFTER HAVING PREFERRED TO EXERCISE HIS JURIS DICTION UNDER SUB- SECTION (2)OF SECTION 50C OF THE ACT AND THE DVO HA VING DETERMINED THE FAIR MARKET VALUE OF THE PROPERTY ON THEATER O F TRANSFER AT RS.59.3 LAKHS, WAS LEFT WITH NO CHOICE BUT TO MAKE THE ASSE SSMENT IN ACCORDANCE WITH THE VALUE DETERMINED BY THE DVO I. E. THE AO WAS BOUND TO ADOPT THE FAIR MARKET VALUE OF THE PROPERT Y ON THE DATE OF TRANSFER AT RS.59.3 LAKHS. 6.1 FROM THE ABOVE IT IS CLEAR THAT THE TRIBUNAL HA S HELD THAT THE AO HAS NO CHOICE BUT TO MAKE THE ASSESSMENT IN ACCORDANC E WITH THE VALUE DETERMINED BY THE DVO. THE DVO HAS DETERMINED THE FAIR MARKET VALUE OF THE PROPERTY ON THE DATE OF TRANSFER AT RS.59.30 LA CS I.E. RS.8.80 LACS PER ACRE. THE TRIBUNAL HAS ALSO HELD THAT THE DVOS REPORT WA S BINDING ON THE AO BY VIRTUE OF APPLICABILITY OF SECTION 16A(6) OF THE WE ALTH-TAX ACT,1957, WHICH HAS BEEN MADE APPLICABLE TO THE REFERENCE MADE IN A CCORDANCE WITH SUB- SECTION (2) OF SECTION 50C OF THE ACT. IN OUR VIEW THE DECISION OF THE TRIBUNAL REFERRED TO ABOVE, RENDERED IN THE CASE OF CO-OWNERS IS SQUARELY APPLICABLE TO THE FACTS OF THE PRESENT CASE. IN THA T VIEW OF THE MATTER, WE DO NOT SEE ANY INFIRMITY IN THE FINDINGS OF THE LD.CIT (A) ON THIS ISSUE. WE, THEREFORE, UPHOLD THE ORDER OF THE LD.CIT(A) AND DI SMISS THE APPEAL OF THE REVENUE. 10 C.O.NO.46(LUC.)/2010 7. AT THE TIME OF HEARING, SHRI J.J. MEHROTRA, C.A. , LD. COUNSEL FOR THE ASSESSEE DID NOT PRESS FOR THE GROUNDS RAISED IN T HE CROSS OBJECTION. ACCORDINGLY, WE DISMISS THE SAME AS NOT PRESSED. 8. IN THE RESULT, THE APPEAL OF THE REVENUE AND THE CROSS OBJECTION OF THE ASSESSEE ARE DISMISSED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 19.1.11 . SD. SD. (N.K.SAINI) (H.L.KARWA) ACCOUNTANT MEMBER VICE PRESIDENT JANUARY 19TH ,2011. COPY TO THE : 1. APPELLANT 2. RESPONDENT 3. CIT(A) (4) CIT 5.DR. A.R.,ITAT, LUCKNOW. SRIVASTAVA.