Dipak Narendra Rao Adhikari, Surat V. ACIT,Circle-3(1), Surat

ITA 771/AHD/2015

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 6327 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-04-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 03-04-2017
• Assessment Year: 2010-2011
• Appeal Filed On: 06-04-2015
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SANTOSH KARNANI
• Assessee Lawyers: DINESH DWIVEDI
• Keywords: Salary income; Fair market value; Valuation report

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD D BENCH (BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER & SHRI MAHAVIR PRASAD, JUDICIAL MEMBER) ITA. NO: 771/AHD/2015 (ASSESSMENT YEAR: 2010-11) DIPAK NARENDRA RAO ADHIKARI QUARTER NO. 867, KRIBHCO TOWNSHIP, KRIBHCO NAGAR, SURAT V/S ACIT CIRCLE-3(1), SURAT (APPELLANT) (RESPONDENT) PAN: AAZPA 7914Q APPELLANT BY : SHRI DINESH DWIVEDI, AR RESPONDENT BY : SHRI SANTOSH KARNANI, SR. D. R. ( )/ ORDER DATE OF HEARING : 03 -04-201 7 DATE OF PRONOUNCEMENT : 06-04-2017 PER N.K. BILLAIYA, ACCOUNTANT MEMBER: 1. THIS APPEAL BY THE ASSESSEE IS PREFERRED AGAINST TH E ORDER OF THE LD. CIT(A)- 3, SURAT DATED 23.01.2015 PERTAINING TO A.Y. 2010-1 1. ITA NO 771/A HD/2015 . A.Y. 2010-11 2 2. THE ONLY GRIEVANCE OF THE ASSESSEE IS THAT THE LD. CIT(A) ERRED IN CONFIRMING THE ADDITION OF RS. 6,21,730/- ON ACCOUNT OF 1/8 TH SHARE OF THE ASSESSEE. 3. THE ASSESSEE DERIVES INCOME FROM SALARY BEING A MAN AGER IN KRISHAK BHARATI CO-OPERATIVE LIMITED, SURAT. THE RETURN FOR THE YEAR WAS SELECTED FOR SCRUTINY ASSESSMENT. DURING THE COURSE OF THE S CRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSEE WAS ASKED TO FURNISH THE DETAILS IN RESPECT OF PROPERTY PURCHASED OR SOLD DURING THE YEAR UNDER CO NSIDERATION. THE ASSESSEE BROUGHT TO THE NOTICE OF THE A.O. THAT HE HAS RECEIVED ANCESTRAL LAND UNDER INHERITANCE AFTER THE DEMISE OF HIS MOTH ER. IT WAS FURTHER EXPLAINED THAT THE ASSESSEE HAS INHERITED 1/8 TH SHARE IN THE SAID PIECE OF AGRICULTURAL LAND WHICH WAS SOLD FOR RS. 70 LACS OU T OF WHICH THE ASSESSEE GOT RS. 8.75 LACS AS HIS SHARE. THE ASSESSEE FURTHE R FILED THE COMPUTATION OF LONG TERM CAPITAL GAIN BY TAKING COST OF ACQUISITIO N AS ON 01.04.1981 AT RS. 100. THE A.O. WAS NOT CONVINCED WITH THE FAIR MARKE T VALUE DECLARED BY THE ASSESSEE AND ACCORDINGLY REFERRED THE MATTER TO THE DVO. THE DVO ADOPTED THE FAIR MARKET VALUE @ 18 PER SQ. MTR. AND THE A.O. RECOMPUTED THE LONG TERM CAPITAL GAIN BY TAKING RS. 18 AS THE FMV AS ON 01.04.1981 AND MADE THE ADDITION ACCORDINGLY. 4. ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(A) B UT WITHOUT ANY SUCCESS. 5. WHILE DISMISSING THE APPEAL OF THE ASSESSEE, THE LD . CIT(A) OBSERVED THAT THE VALUATION REPORT SUBMITTED BY THE APPELLANT IS NOT FROM A REGISTERED VALUER. THE LD. CIT(A) FURTHER FOUND THAT THE VALUA TION REPORT SUBMITTED BY ITA NO 771/A HD/2015 . A.Y. 2010-11 3 THE ASSESSEE IS NOT ON ANY SCIENTIFIC BASIS, THE LD . CIT(A) CONFIRMED THE ADDITIONS. 6. BEFORE US, THE LD. COUNSEL FOR THE ASSESSEE VEHEMEN TLY STATED THAT THE REFERENCE TO THE DVO IS NOT ACCORDING TO THE PROVIS IONS OF THE LAW. THE LD. COUNSEL FURTHER BROUGHT TO OUR NOTICE REPORT OF A R EGISTERED VALUER DATED 01.07.2013. IT IS THE SAY OF THE LD. COUNSEL THAT T HIS REGISTERED VALUER HAS ESTIMATED THE FMV AS ON 01.04.1981 AT RS. 110 PER S Q. MTR. THEREFORE, THE SAME SHOULD BE ACCEPTED. 7. PER CONTRA, THE LD. D.R. STRONGLY RELIED UPON THE F INDINGS OF THE REVENUE AUTHORITIES. 8. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION. THE UNDIS PUTED FACT IS THAT THE FIRST VALUATION REPORT SUBMITTED BY THE ASSESSEE WA S NOT FROM A REGISTERED VALUER AND THE SECOND VALUATION REPORT WHICH IS FRO M A REGISTERED VALUER IS DATED 01.07.2013 AND THE ASSESSMENT ORDER IS DATED 28.03.2013 WHICH MEANS THAT THE SAME HAS BEEN OBTAINED AFTER THE ASS ESSMENT ORDER. A PERUSAL OF THE VALUATION REPORT SHOWS THAT NO COMPA RABLE CASE HAS BEEN CONSIDERED BY THE VALUER. WE FIND THAT THE VALUER H AS ADOPTED THE GOLD PRICE-INDEX FIXED BY THE RESERVE BANK OF INDIA AS H IS APPROACH TO THE VALUATION OF THE LAND. IN OUR CONSIDERED OPINION, T HE APPROACH ADOPTED BY THE VALUER IN HIS VALUATION REPORT DATED 01.07.2013 IS NOT PROPER. THOUGH THE REFERENCE TO THE DVO BY THE A.O IS NOT AS PER T HE PROVISIONS OF THE LAW AND, THEREFORE, THE VALUATION MADE BY THE DVO CANNO T FORM THE BASIS OF THE ITA NO 771/A HD/2015 . A.Y. 2010-11 4 ASSESSMENT BUT AT THE SAME TIME THE VALUATION ADOPT ED BY THE ASSESSEE DOES NOT ALSO HAVE ANY SCIENTIFIC BASIS. THE FAIR M ARKET VALUE TAKEN BY THE A.O. IS @ 18 PER SQ. MTR. AND THE FAIR MARKET VALUE TAKEN BY THE ASSESSEE IS @ RS. 100 PER SQ. MTR. TO BRING TO AN END UNNECESSA RY LITIGATION, IN OUR CONSIDERED OPINION, THE FAIR MARKET VALUE AS ON 01. 04.1981 IF TAKEN AT RS. 60 PER SQ. MTR. SHOULD MEET THE ENDS OF JUSTICE. WE , ACCORDINGLY, DIRECT THE A.O. TO ADOPT FMV AS ON 01.04.1981 AT RS. 60 PER SQ . MTR. AND RE-COMPUTE THE LONG TERM CAPITAL GAINS TAX LIABILITY. 9. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 06 - 04- 20 17 SD/- SD/- (MAHAVIR PRASAD) (N. K. BILLAIYA) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER AHMEDABAD: DATED 06/04/2017 RAJESH COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,AHME DABAD