SHRI VIJAY KUMAR PATNI, JAIPUR V. INCOME TAX APPELLATE TRIBUNAL, WARD-2-1, JAIPUR

ITA 715/JPR/2017

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5693 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 22-09-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: A K MAHLA
• Keywords: Sale consideration of property below Jantri Value; Additional evidence; Cost of acquisition; Fair market value; Set aside
• Section: 50C

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S,B JAIPUR JH FOT; IKY JKO] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA- @ ITA NO. 715/JP/2017 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2010-11 SHRI VIJAY KUMAR PATNI 1, DERVI JI KA MANDI, JOHARI BAZAR, JAIPUR. CUKE VS. THE ITO, WARD-2(1), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ADYPP 7915 J VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI RAJEEV SOGANI (C.A.) JKTLO DH VKSJ LS @ REVENUE BY : SHRI A.K. MAHLA (JCIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 20/03/2019 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 14/05/2019 VKNS'K@ ORDER PER: VIJAY PAL RAO, J.M. THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 11.05.2017 OF THE LD. CIT(A), JAIPUR FOR THE ASSESS MENT YEAR 2010-11. 2. THERE IS A DELAY OF 51 DAYS IN FILING THE PRESE NT APPEAL. THE ASSESSEE HAS FILED AN APPLICATION FOR CONDONATION O F DELAY WHICH HAS BEEN SUPPORTED BY AFFIDAVIT AS WELL AS MEDICAL RECO RD OF THE ASSESSEE. 3. WE HAVE HEARD THE LD. AR AS WELL AS THE LD. DR AND CAREFULLY PERUSED THE REASONS EXPLAINED BY THE ASSESSEE FOR D ELAY OF 51 DAYS IN ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 2 FILING THE PRESENT APPEAL. IT WAS SUBMITTED THAT TH E ASSESSEES MOTHER AGED ABOUT 71 YEARS WAS NOT KEEPING WELL AND WAS EV ENTUALLY HOSPITALIZED ON 28.07.2017. THE ASSESSEE IS THE ONL Y SON AND WAS BUSY IN LOOKING AFTER HIS MOTHER AND WAS DISTURBED ON AC COUNT OF ILL HEALTH AND HOSPITALIZED OF HIS MOTHER. THUS, THE ASSESSEE HAS EXPLAINED THE CAUSE OF DELAY AS HE WAS ENGAGED IN TAKING CARE OF HIS MOTHER WHO WAS NOT MAINTAINING GOOD HEALTH AND WAS HOSPITALIZED TH EREFORE, THE ASSESSEE COULD NOT TAKE THE NECESSARY STEPS IN FILI NG THE APPEAL WITHIN LIMITATION. THE ASSESSEE HAS ALSO FILED THE MEDICAL RECORD OF MOTHER OF THE ASSESSEE AS WELL AS THE DEATH CERTIFICATE DATED 05.09.2017 OF THE MOTHER OF THE ASSESSEE. 4. ON THE OTHER HAND LD. DR HAS OBJECTED TO THE APP LICATION FOR CONDONATION OF DELAY. 5. HAVING CONSIDERED THE RIVAL SUBMISSIONS AND CARE FUL PERUSAL ON RECORD, WE FIND THAT THE ASSESSEE HAS EXPLAINED THE CAUSE OF DELAY AS THE MOTHER OF THE ASSESSEE WAS NOT WELL AND WAS HOS PITALIZED ON 28.07.2017. FURTHER, THE MOTHER OF THE ASSESSEE DIE D ON 05.09.2017. THE ASSESSEE HAS PRODUCED THE MEDICAL RECORD OF THE AILING MOTHER AND THEREFORE, THE REASONS EXPLAINED BY THE ASSESSEE AR E FOUND TO BE REASONABLE FOR DELAY IN FILING THE PRESENT APPEAL. HENCE, WE ARE SATISFIED ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 3 WITH THE CAUSE OF DELAY EXPLAINED BY THE ASSESSEE B EING REASONABLE AND ACCORDINGLY THE DELAY OF 51 DAYS IN FILING THE PRES ENT APPEAL IS CONDONED. 6. THE ASSESSEE HAS RAISED THE FOLLOWING GROUNDS:- 1.(A) IN THE FACTS AND CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF TH E LD. AO IN CONFIRMING ADDITION OF LONG TERM CAPITAL GAIN AT RS . 1,72,84,490 AS AGAINST THE ADDITION OF RS. 2,10,88, 170 MADE BY LD. AO. THE ACTION OF THE LD. CIT(A) IS ILLEGAL, UN JUSTIFIED, ARBITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY DELETING THE SAID ADDITION OF RS. 1,72,8 4,490. (B) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF THE LD . AO IN INVOKING THE PROVISIONS OF SECTION 50C OF THE INCOME TAX ACT , 1961 AND ADOPTING THE SALE CONSIDERATION AT RS. 2,61,53,980 AGAINST THE DECLARED SALE CONSIDERATION OF RS. 1,55,00,000. THE ACTION OF THE ID. CIT(A) IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND A GAINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY ACCEPTING THE SALE CONSIDERATION AT RS. 1,55,00,000 AS EVIDENCED BY TH E SALE DEED. (C) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW LD. CIT(A) HAS ERRED IN CONFIRMING THE ACTION OF LD. AO IN CON SIDERING THE ENHANCED VALUE OF THE PROPERTY, TAKEN BY STAMP VALU ATION AUTHORITIES, WHEN UNDER SECTION 50C, ONLY 'ASSESSED VALUE' AND NOT 'RE-ASSESSED VALUE' CAN BE TAKEN FOR THE PURPOS E OF ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 4 COMPUTING CAPITAL GAINS UNDER SECTION 48. THE ACTIO N OF THE LD. CIT(A) IS ILLEGAL, UNJUSTIFIED AND ARBITRARY AND AG AINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY CONSIDERI NG THE VALUE OF THE PROPERTY, TAKEN BY STAMP VALUATION AUTHORITI ES, AT THE TIME OF TRANSFER OF SUCH PROPERTY. (D)IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW THE LD. DVO HAS ERRED IN CALCULATING THE FMV OF THE PROPERT Y ON THE DATE OF SALE AT RS. 3,44,91,400 AS AGAINST THE DECLARED SALE CONSIDERATION OF RS. 1,55,00,000. THE ACTION OF THE LD. DVO IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAINST THE FAC TS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY ACCEPTING THE SALE CONSIDERATION AT RS. 1,55,00,000 AS DECLARED BY THE ASSESSEE, FOR COMPUTING THE LONG TERM CAPITAL GAIN. (E) IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. DVO HAS ERRED IN CALCULATING THE COST OF ACQUISITION OF THE PROPERTY ON 01.04.1981 AT RS. 14,03,400 AS AGAINST THE DECLARED COST OF ACQUISITION OF RS. 23,07,171. THE ACTION OF THE LD. DVO IS ILLEGAL, UNJUSTIFIED, ARBITRARY AND AGAINST THE FACTS OF THE CASE. RELIEF MAY PLEASE BE GRANTED BY ACCEPTING THE COST OF ACQUISIT ION AT RS. 23,07,171 AS DECLARED BY THE ASSESSEE, FOR COMPUTIN G THE LONG TERM CAPITAL GAIN. 2. THE ASSESSEE CRAVES HIS RIGHTS TO ADD, AMEND OR ALTER ANY OF THE GROUNDS ON OR BEFORE THE HEARING. ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 5 7. GROUND NO. 1(C), AT THE TIME HEARING, THE LEARNE D COUNSEL FOR THE ASSESSEE HAS STATED AT BAR THAT THE ASSESSEE DOES N OT PRESS GROUND NO. 1(C) AND THE SAME MAY BE DISMISSED AS NOT PRESSED. THE LD. DR HAS RAISED NO OBJECTION IF GROUND NO. 1(C) OF THE ASSES SEES APPEAL IS DISMISSED AS NOT PRESSED. ACCORDINGLY THE GROUND NO . 1(C) OF THE ASSESSEES APPEAL IS DISMISSED BEING NOT PRESSED. 8. GROUND NOS. 1(A) (B) AND (D) ARE REGARDING THE A DDITION MADE BY THE AO ON ACCOUNT OF LONG TERM CAPITAL GAIN BY ADOP TING THE FULL VALUE CONSIDERATION AS PER THE PROVISIONS OF SECTION 50C OF THE IT ACT AT RS. 2,61,53,980/- AS AGAINST SALE CONSIDERATION OF RS. 1,55,00,000/-. THE ASSESSEE IS AN INDIVIDUAL AND PROPRIETOR OF M/S TRA DING CORPORATION AND E-FILED HIS RETURN OF INCOME ON 13.10.2010 DECLARIN G TOTAL INCOME OF RS. 3,75,690/-. IN THE SCRUTINY ASSESSMENT, THE AO NOTE D THAT THE ASSESSEE HAS SOLD SOME PORTION OF BUILDING D-38A, ASHOKA MAR G, AHINSHA CIRCLE, JAIPUR FOR A CONSIDERATION OF RS. 1,55,00,000/- AND THE STAMP DUTY VALUE OF THE SAME WAS TAKEN AT RS. 1,55,53,414/- AT THE T IME OF SALE DEED DATED 09.12.2009. SUBSEQUENTLY, THE AO FOUND THAT A S PER ITS INFORMATION THE VALUE OF THE PROPERTY SOLD BY THE A SSESSEE WAS DETERMINED BY SUB-REGISTRAR, SANGANER, JAIPUR AT RS . 2,61,53,980. IN ORDER TO VERIFY THE CORRECT STATUS OF THE VALUE FOR STAMP DUTY VALUE. THE ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 6 AO REQUESTED THE SUB-REGISTRAR TO PROVIDE THE CORRE CT POSITION VIDE LETTER DATED 11.03.2013. IN RESPONSE, THE SUB-REGIS TRAR VIDE LETTER DATED 12.03.2013 PROVIDED DETAILS OF VALUATION OF THE PRO PERTY IN QUESTION WHEREBY THE VALUATION WAS REVISED AT RS. 2,61,53,98 0/-. THE AO HAS REPRODUCED THE DETAILS OF THE SAID LETTER IN THE AS SESSMENT ORDER. THE AO NOTED THAT THE ASSESSEE AS DECLARED THE SALE OF ONE FLAT ONLY IN THE RETURN OF INCOME WHEREAS THE DETAILS PROVIDED BY TH E SUB-REGISTRAR THE ASSESSEE HAS SOLD TWO PROPERTIES A FLAT AS WELL AS PORTION OF THE LAND. CONSEQUENTLY, THE AO ADOPTED THE FULL VALUE CONSIDE RATION OF THE ASSESSEE PROPERTY U/S 50C OF THE ACT AT RS. 2,61,53 ,980/- WHILE FRAMING THE ASSESSMENT DATED 29.03.2013. THE ASSESSEE CHALL ENGED THE ACTION OF THE AO BEFORE THE LD. CIT(A) AND CONTENDED THAT THE FAIR MARKET VALUE OF THE PROPERTY OF RS. 1,55,00,000/- DECLARED BY THE ASSESSEE AND THE REVISED STAMP DUTY VALUATION ADOPTED BY THE REG ISTRAR WAS NOT IN THE KNOWLEDGE OF THE ASSESSEE. FURTHER, THOUGH THE AO REFERRED THE VALUATION TO THE DVO VIDE LETTER DATED 19.03.2013. HOWEVER, THE SAID REFERENCE WAS RETURNED BY THE DVO ON THE GROUND THA T DUE TO SHORTAGE OF TIME THE VALUATION COULD NOT BE COMPLETED BEFORE 31.03.2013 THE TIME LIMIT FOR PASSING THE ASSESSMENT ORDER. THUS, THE ASSESSEE HAS CHALLENGED THE ADOPTION OF FULL VALUE CONSIDERATION WITHOUT TAKING THE ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 7 FAIR MARKET VALUE OF THE PROPERTY THROUGH DVO. THE LD. CIT(A) CALLED FOR A REMAND REPORT PARTICULARLY ON THE DETERMINATION O F FAIR MARKET VALUE OF THE PROPERTY THROUGH DVO. IN THE REMAND REPORT, IT WAS POINTED OUT THAT THE DVO HAS DETERMINED THE FAIR MARKET VALUE O F THE PROPERTY IN QUESTION AT RS. 3,44,91,400/- AND THEREFORE, FULL V ALUE CONSIDERATION ADOPTED BY THE AO AT RS. 2,61,53,980/- IS IN ACCORD ANCE WITH THE PROVISIONS OF SECTION 50C OF THE ACT. THE LD. CIT(A ) ACCORDINGLY UPHELD THE ACTION OF THE AO TO THE EXTENT ADOPTING THE FUL L VALUE CONSIDERATION U/S 50C OF THE ACT. 9. BEFORE US, THE LD. AR OF THE ASSESSEE HAS SUBMIT TED THAT THE PROPERTY IN QUESTION WAS A RESIDENTIAL PROPERTY AS STATED IN THE SALE DEED WHEREAS THE DVO HAS CONSIDERED THE SAME AS COM MERCIAL WHILE DETERMINING THE FAIR MARKET VALUE OF THE LAND IN QU ESTION. SINCE, THE ASSESSEE NEVER APPLY FOR CONVERSION OF THE SAID LAN D/PROPERTY THEREFORE, THE SAME CAN BE VALUED AS A RESIDENTIAL PROPERTY AN D NOT COMMERCIAL. IN SUPPORT OF HIS CONTENTION, HE HAS RELIED UPON TH E DECISION OF HYDRABAD BENCHES OF THE TRIBUNAL IN CASE OF N. REVA THI VS. ITO IN ITA NO. 67/HYD/2013 AND SUBMITTED THAT WHEN THE BUILDIN G HAS BEEN CONSTRUCTED FOR RESIDENTIAL USE WITH ALL AMENITIES WHICH ARE NECESSARY FOR RESIDENTIAL ACCOMMODATION THEN EVEN IF IT IS US ED FOR NON RESIDENTIAL ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 8 PURPOSE IT WOULD NOT LOSE ITS CHARACTER AS A RESIDE NTIAL BUILDING. FURTHER, THE DVO HAS ALSO COMPUTED THE VALUE/COST OF CONSTRU CTION BY ADOPTING THE CPWD RATES WHEREAS THE PROPERTY SITUATED IN THE STATE PWD JURISDICTION AND THEREFORE, STATE PWD RATES OUGHT T O HAVE APPLIED. HE HAS RELIED UPON THE DECISION OF HONBLE JURISDICTIO NAL HIGH COURT IN CASE OF CIT VS. DINESH TALWAR 265 ITR 344 . THE AR HAS A LSO REFERRED TO A SHOW CAUSE NOTICE ISSUED BY THE NAGAR NIGAM DATED 2 4.12.2012 AGAINST THE UNAUTHORIZED USE OF PROPERTY FOR COMMERCIAL PUR POSE. HE HAS THEN REFERRED TO THE DECISION OF COORDINATE BENCHES DATE D 27.04.2018 IN CASE OF SHRI SUNIL JAIN VS. DCIT IN ITA NO. 04/JP/2 017. THUS, THE LD. AR HAS SUBMITTED THAT THE FAIR MARKET VALUE DETERMINED BY THE DVO BY TAKING COMMERCIAL RATES IS NOT JUSTIFIED WHEN THE P ROPERTY IS A RESIDENTIAL BUILDING. THE LD. AR HAS REFERRED TO TH E SITE PLAN SANCTIONED BY THE AUTHORITY AND SUBMITTED THAT AS PER THE SANC TION PLAN THE BUILDING WAS CONSTRUCTED ONLY FOR RESIDENTIAL PURPO SE. HE HAS ALSO FILED AN APPLICATION IN RULE 29 OF THE ITAT RULES, 1963 F OR ADDITIONAL EVIDENCE AND SUBMITTED THAT WHEN THE SANCTION PLAN CLEARLY REVEALS THE NATURE OF CONSTRUCTION AND USE OF THE PROPERTY ONLY FOR A RESIDENTIAL PURPOSE THEN IT IS RELEVANT FOR THE PURPOSE OF THE DETERMINING THE FAIR MARKET VALUE . ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 9 10. ON THE OTHER HAND, LD. DR HAS RELIED UPON THE O RDER OF AUTHORITIES BELOW AND SUBMITTED THAT THERE IS NO DISPUTE THAT T HE PROPERTY IS BEING USED FOR COMMERCIAL PURPOSE WHICH IS ALSO ADMITTED BY THE ASSESSEE AS WELL AS THIS FACT WAS POINTED OUT BY THE SHOW CAUSE ISSUED BY THE NAGAR NIGAM DATED 24.12.2014. ONCE THE ACTUAL USE OF THE PROPERTY IS FOR COMMERCIAL THEN THE RATES OF COMMERCIAL PROPERTY AR E TO BE APPLIED FOR DETERMINING THE FAIR MARKET VALUE OF THE PROPERTY. SINCE, THE DVO VALUED THE PROPERTY MORE THAN THE VALUE ADOPTED BY THE STAMP DUTY AUTHORITY THEREFORE, THE AO HAS TAKEN THE LESSER VA LUE WHICH IS FAIR AND REASONABLE. 11. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AS WEL L AS RELEVANT MATERIAL ON RECORD. THE DISPUTE IS ONLY REGARDING T HE FULL VALUE CONSIDERATION ADOPTED BY THE AO U/S 50C OF THE ACT AS PER THE REVISED STAMP DUTY VALUATION BASED ON COMMERCIAL PROPERTY. IN RESPONSE TO THE OBJECTIONS RAISED BY THE ASSESSEE THE AO REFERRED THE VALUATION TO THE DVO HOWEVER, DUE TO SHORTAGE OF TIME THE SAID REFE RENCE WAS RETURNED BY THE DVO. IN ANY CASE THE LD. CIT(A) AGAIN REFERR ED THE VALUATION TO THE DVO AND AFTER RECEIVING THE REPORT OF THE DVO W HICH DETERMINED THE FAIR MARKET VALUE OF THE PROPERTY MORE THAN THE VALUE ADOPTED BY THE STAMP DUTY AUTHORITY HAS UPHELD THE ACTION OF T HE AO. THE MAIN ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 10 CONTENTION OF THE ASSESSEE IS THAT THE PROPERTY IN QUESTION IS A RESIDENTIAL AS PER RECORD AND THERE IS NO CONVERSIO N OF THE PROPERTY FROM RESIDENTIAL TO NON RESIDENTIAL. THEREFORE, EVE N IF THE PROPERTY WAS BEING USED FOR NON RESIDENTIAL PURPOSE/COMMERCIAL P URPOSE THE VALUATION OF THE SAME CANNOT BE DETERMINED BY ADOPT ING THE COMMERCIAL RATES. THE UNAUTHORIZED USE OF THE PROPE RTY WOULD NOT ENHANCED THE VALUE AS PER THE CONTENTION OF THE ASS ESSEE. THERE IS NO DISPUTE THAT THE PROPERTY IN QUESTION AS PER RECORD IS A RESIDENTIAL PROPERTY HOWEVER, THE LOCATION OF THE PROPERTY AS W ELL AS THE ACTUAL USE OF THE PROPERTY FOR COMMERCIAL PURPOSES HAS LED TO THE STAMP DUTY AUTHORITY AS WELL DVO TO ADOPT COMMERCIAL RATES FOR THE PURPOSE OF VALUATION. THE STAMP DUTY AUTHORITY HAS INITIALLY A PPLIED THE RESIDENTIAL RATE AT THE TIME OF SALE DEEDS BUT SUBSEQUENTLY THE VALUE WAS REVISED BY ADOPTING COMMERCIAL RATES. THIS APPEARS TO BE BA SED ON THE ACTUAL USED OF THE PROPERTY IN QUESTION. EVEN THE ASSESSEE HAS NOT DISPUTED THE ACTUAL USED OF THE PROPERTY AS FOR COMMERCIAL P URPOSE AND DUE TO SUCH UNAUTHORIZED USED THE NAGAR NIGAM ISSUED A SHO W CAUSE ISSUED DATED 24.12.2012. THE ASSESSEE HAS ALSO FILED THE S ANCTIONED PLAN OF THE PROPERTY IN QUESTION AS ADDITIONAL EVIDENCE IN SUPPORT OF THE CLAIM THAT AT THE TIME OF SALE THE PROPERTY WAS A RESIDEN TIAL ONE AND ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 11 SUBSEQUENT MISUSE OF THE SAME FOR COMMERCIAL PURPOS E WILL NOT ENHANCE THE FAIR MARKET VALUE. IT IS PERTINENT TO N OTE THAT THOUGH THE LOCATIONAL ADVANTAGE AND ACTUAL USE OF THE PROPERTY FOR COMMERCIAL PURPOSE ARE CERTAINLY RELEVANT FACTORS FOR DETERMIN ING FAIR MARKET VALUE OF THE PROPERTY BUT THIS ITSELF WILL NOT BE A GROUN D TO RECLASSIFY THE PROPERTY FROM RESIDENTIAL BUT COMMERCIAL ONE. THERE FORE, THE RATES OF THE COMMERCIAL PROPERTY CANNOT BE APPLIED TO A PROP ERTY WHICH IS UNAUTHORISEDLY USED FOR COMMERCIAL PURPOSE. THOUGH THE LOCATIONAL ADVANTAGE AND ACTUAL OF COMMERCIAL USE ARE THE RELE VANT FACTOR FOR DETERMINING THE FAIR MARKET VALUE BUT THESE CANNOT BE THE BASIS FOR TREATING THE PROPERTY AS COMMERCIAL ONE. THEREFORE, THE FAIR MARKET VALUE OF THE PROPERTY HAS TO BE DETERMINED ON THE B ASIS OF THE PREVAILING RATE IN THE AREA AS WELL AS ON THE BASIS OF SALE INSTANCE WHICH CAN BE CONSIDERED AS COMPARABLE CASES. THE DVO HAS ADOPTED THE COMMERCIAL RATE FOR DETERMINING THE FAIR MARKET VAL UE OF THE PROPERTY WHEREAS THE FACT REMAINS THAT THE PROPERTY IS A RES IDENTIAL AREA BUT IS BEING USED FOR COMMERCIAL PURPOSE. THUS APPLYING TH E COMMERCIAL RATES ON A RESIDENTIAL PROPERTY USED FOR COMMERCIAL PURPO SE IS NOT PROPER AND JUSTIFIED. THOUGH IT MAY HAVE A COMPARATIVE ADVANTA GE THAN THE RESIDENTIAL PROPERTY WHICH IS ALSO USED FOR RESIDEN TIAL PURPOSE BUT THE ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 12 SAID ADVANTAGE WILL NOT CONVERT IT TO COMMERCIAL AR EA. ACCORDINGLY, WE ARE OF THE CONSIDERED VIEW THAT THE DETERMINATION O F THE FAIR MARKET VALUE BY THE DVO REQUIRES A FRESH LOOK BASED ON THE PREVAILING FAIR MARKET PRICE WELL AS COMPARABLE SALE INSTANCE. SINC E, THE ASSESSEE HAS NOW FILED THE SITE PLAN AS ADDITIONAL EVIDENCE, THE REFORE, IN THE FACTS AND CIRCUMSTANCES OF THE CASE WE SET ASIDE THIS ISSUE O F FAIR MARKET VALUE TO THE RECORD OF THE DVO/AO FOR REDETERMINATION OF THE SAME AS PER ABOVE OBSERVATIONS. IT IS ALSO PERTINENT TO NOTE THAT FOR THE PURPOSE OF COMPUTING THE COST OF CONSTRUCTION THE STATE PWD RA TES SHALL BE APPLIED AS AGAINST CPWD RATES AS THE PROPERTY IS SITUATED I N THE JURISDICTION OF STATE PWD AND NOT IN THE JURISDICTION OF CPWD. HENC E, THE DVO IS DIRECTED TO RECONSIDER THE DETERMINATION OF FAIR MA RKET VALUE AND AFTER GIVING AN OPPORTUNITY OF HEARING TO THE ASSESSEE. 12. GROUND NO. 1(E) IS REGARDING THE DETERMINATION OF COST OF ACQUISITION OF THE PROPERTY ON 01.04.1981. 13. WE HAVE HEARD LD. AR AS WELL AS LD. DR AND CONS IDERED THE RELEVANT MATERIAL ON RECORD. THE ASSESSEE HAS DECLA RED THE COST OF ACQUISITION OF RS. 23,07,171/- WHEREAS THE DVO HAS DETERMINED THE SAME AS ON 01.04.1981 AT RS. 14,03,400/-. THE LD. A R OF THE ASSESSEE HAS SUBMITTED THAT THE DVO HAS DETERMINED THE COST OF ACQUISITION AS ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 13 ON 01.04.1981 ON THE BASIS OF COMPARABLE SALES BUT THE SAME WAS NOT CONFRONTED WITH THE ASSESSEE. EVEN OTHERWISE THE SA LE INSTANCES TAKING INTO CONSIDERATION BY THE DVO ARE NOT COMPARABLE AS THERE ARE IN RESPECT OF AREA NOT SIMILAR TO THE PROPERTY OF THE ASSESEE. THE AO/DVO HAS ALSO MADE ADDITION OF 50% TO THE VALUE AS IT WA S SITUATED IN THE CORNER. ALL THESE FACTS WERE NOT CONFRONTED WITH TH E ASSESSEE. 14. ON THE OTHER HAND, THE LD. DR HAS SUBMITTED THA T THE DVO HAS CONSIDERED ALL THE RELEVANT FACTORS WHILE ADOPTING THE FAIR MARKET VALUE AS ON 01.04.1981. HE HAS RELIED UPON THE ORDER OF T HE AUTHORITIES BELOW. 15. HAVING CONSIDERED THE RIVAL SUBMISSIONS AS WELL AS RELEVANT MATERIAL ON RECORD WE FIND THAT THE DVO HAS TAKEN T HE FAIR MARKET VALUE AS ON 01.04.1981 BY CONSIDERING THE COMPARABLE INST ANCES HOWEVER, THE ASSESSEE WAS NOT CONFRONTED WITH SUCH COMPARABL E CASES TO BE ADOPTED BY THE DVO. FURTHER, THE DVO ENHANCED THE V ALUE DUE CORNER LOCATION OF THE PROPERTY THIS WAS ALSO NOT CONFRONT ED WITH THE ASSESSEE. SINCE, THE MAIN ISSUE OF DETERMINING THE FAIR MARKE T VALUE AS ON THE DATE OF THE SALE HAS BEEN REMANDED TO THE DVO/AO, T HEREFORE THIS ISSUE OF DETERMINING THE FAIR MARKET VALUE AS ON 01.04.19 81 FOR THE PURPOSE OF COST OF ACQUISITION OF THE PROPERTY IS ALSO SET ASIDE TO THE RECORD OF ITA NO. 715/JP/2017 SHRI VIJAY KUMAR PATNI VS. ITO 14 THE DVO/AO FOR DETERMINING THE SAME AFRESH AFTER CO NSIDERATION THE OBJECTIONS OF THE ASSESSEE. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 14/05/2019. SD/- SD/- FOE FLAG ;KNO FOT; IKY JKO (VIKRAM SINGH YADAV) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 14/05/2019. * SANTOSH. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SHRI VIJAY KUMAR PATNI, JAIPUR. 2. IZR;FKHZ@ THE RESPONDENT- ITO, WARD-2(1), JAIPUR. 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 715/JP/2017} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR