SIVAPOTHULURU VEERAREDDY GADLURU, HYDERABAD,HYDERABAD vs. ASST.COMMISSIONER OF INCOME TAX, CIRCLE-2(2), HYDERABAD

PER S.S.GODARA, J.M. :

These two assessees’ appeals for AY.2007-08 arise from the CIT(A)-2, Hyderabad’s orders dated 30-06-2017 passed in appeal Nos.0095 & 0094/2015-16; in proceedings u/s.143(3) r.w.s. 147 of the Income Tax Act, 1961 [in short, ‘the Act’]. Heard both parties. Case files perused.

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invoking Section 50C despite the alleged fact that the land sold herein is agricultural only than a capital asset u/s.2(14) of the Act.

“5. I have considered the assessment order and grounds of appeal. The only issue involved in the appeal is with regard to AO's action in making an addition of Rs.37,00,000/- (Rs.69,37,500 - Rs.32,37,500) towards capital gains as against the amount admitted by the assessee. AO's observations are as under: "2.0, A search and seizure operation was conducted on 28/07/2008 in the case of Sri Venkata Kutamba Rao & others and assessee’s residential premise was also covered under the search operation. During the search proceedings, the assessee's undisclosed income was quantified by the Investigation Wing at Rs. 60 Lakhs for A.Y.2007-08, on account of non-filing of Return of Income. The assessee vide his deposition dtd: 12/09/2008 admitted the same (i.e. Rs.60 Lakhs) as his income and accordingly filed the Return of Income on 05/03/2010 in response to the notice u/s.153A of the Act returning an income of Rs.45,60,602/-. The assessment was completed on 27/12/2010 u/s. 143(3) r.w.s.153A of the Income Tax Act, 1961 (herein after referred to as 'the Act') making an addition of Rs.14,40,000/- being the difference between the income admitted by the assessee vide his deposition dtd: 12/09/2008 and income admitted by the assessee in the return of income filed by him on 05/03/2010. 3.0. in the return of income filed by the assessee for A.Y.2007-08 on 05/03/2010, the assessee admitted income of Rs. 45,60,602/- under various heads of income as follows:

Salary Rs. 12,56,400/- Income from House Property Rs. 10,92,938/- Capital Gains Rs. 21,59,554/- Income from Other Sources Rs. 21,710/- Gross Total Income Rs. 45,60,602/-

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4.0. The long term capital gain admitted by the assessee was offered on the sale of his share of property of land admeasuring Ac 4.14 Gts (which the assessee jointly owned Sri. G. Siva Sankar Reddy) situated at Survey No. 124/1, Shamshabad Village Grampanchayat, Shamshabad Mandal, Rangareddy Dist, Vide sale deed no. 15085/2006. 4.1. Subsequently, it was observed that the assessee has failed to disclose in the return of income filed by him, the material tact that the value adopted by the concerned authorities) for the purpose of stamp duty is Rs.1,38,75,000/- as against. the full value consideration of Rs.(64,75,000/- adopted by the assessee for the computation of capital gain for A.Y.2007-08. As per the provisions of Sec.50C of the Act; the value adopted for the purpose of stamp duty should be deemed as the full value consideration received by the assessee. Since the income of the assessee for A.Y.2007-08, has escaped assessment to an extent of Rs.37,00,000/- (Rs.69,37,500 Rs.32,37,500) with regard to his share of property (i.e., 50% of 1,38,75,000), the case was re-opened u/s.147 of the Act with the prior approval of the Commissioner of Income Tax (Central), Hyderabad. Subsequently, a notice u/s. 148 of the Act was issued to the assessee on 28/03/2014.

4.2. In response, thereto the assessee vide letter dtd: 31/07/2014 requested for the adjournment of the case for 15 days.

4.3. Subsequently, the case was notified to the undersigned vide the order passed by the Commissioner of Income Tax (Central) in F.No. CIT(C)/1-1/Decentral/2014-15 dated 16/06/2014 and corrigendurm passed in F.No. CIT(C)/HYD/Corrigendum/2014-15 dated 29/10/2014.

4.5. Since the assessee did not file the return of income in response to notice u/s.148 of the Act, a show cause notice was issued to the assessee on 30/12/2014 in which it was proposed to apply the provisions of S. 50C of the Act, thereby deeming the value of Rs.1,38,75,000/- adopted for the purpose of stamp duty as the full value consideration received by the assessee. In this connection the assessee was asked to furnish his objection if any on or before 06/01/2015.

4.6. In response to the above mentioned show cause notice, the assessee vide letter dtd:06/01/2015 requested for the adjiournment or the case to tic wecit. The assessee’s request was considered and the case was adjourned to 12/01/2015 Subsequently, the assessee vide letter dtd: 23/01/2015 submitted that in response to notice u/s.

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148 of the Act, the assessee had filed a return of income on 23/01/2015 and enclosed a copy of the same. In the return of income filed by the assessee on 23/01/2015 (in response to notice u/s. 148 of the Act) the assessee admitted an income of only Rs, 24,01,048/- as against the income of Rs.45,00,600/- admitted by him in the return filed on 05/03/2010. Further, the assessee requested for the reasons for issue of notice u/s. 148 of the Act. , 4.7. In response to the same, vide this office letter 27/01/2015, the reasons for reopening the case provided to the assessee. Subsequently the assessee vide letter received in this office on 02/02/2015 submitted as follows: "at the time of filing of the original return of income the sale of agricultural land was inadvertently computed as long term capital gain and tax paid. However, on receipt of the notice u/s. 148, realized that the sale was in respect of agricultural lands and the same are exempt from tax. The land being agricultural land within the meaning of Sec.2(14)(iii) of the I.T.Act is exempt from tax. Hence, accordingly in the return of income in response to notice u/s.148, the exemption of agricultural land was claimed. The provisions of Sec.50C of the I.T.Act are not applicable to agricultural lands for the reason that agricultural lands do not come under the definition of 'capital asset". We bring to your kind attention that the assessment was completed under Sec 153A rws 143(3) of the I.T.Act. The then Assessing Officer has in fact verified the sale deed and took into account all the materials available on record. Therefore there is no fresh material brought on record…. 5.0.The assesssee's submissions were considered and found to be not acceptable for the following facts.

5.1. The assessee has submitted that the land on which capital gain was offered In the Original return is actually an agricultural land. This submission of the assessee does not hold good for the fact that the assessee himself offered the same to tax. It is pertinent here to note that the assessee in his deposition dt: 12/09/2008 admitted an income of Rs. 60,00,000/- and accordingly offered the capital gain from the above mentioned land in addition to other income as mentioned in para 3.0. of this order. Consequent to the search operation, the assessee having taken a conscious decision to offer capital gain on the sale of the above mentioned property, is not correct in stating that the said land is an agriculture land and the capital gain was offered on the same by mistake.

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5.2. Further, the assessee furnished a letter dt: Nil from some retired Inspector of Survey, stating that the said property is 5 kilo meters away from Shamshabad area. This letter does not have any evidentiary value for the fact that it has been issued by an unidentified person, it is not addressed to any authority/person in particular, the letter does not contain any date and the survey number of the land. It is seen that the sale deed mentions the land as 'agriculture land', but the assessee could not substantiate that said land is not situated within the jurisdiction of any municipal corporation or cantonment or notified area or within prescribed distance from the local limit of the above mentioned areas. In view of the above, there is no merit in the assessee's contention that the land that was sold by the assessee during F.Y. 2005-07 is an agricultural one, Hence, the provisions of S. 50C of the Act is applicable to the assessee's case. 5.3. Further the assessee has submitted that since the agricultural land that was sold by the assessee was not having a proper approach road and the land was surrounded by the lands of the neighbors from all the sides, the land was sold for a price less than the market value fixed by the SRO. The assessee has further requested to refer the issue to the Department Valuation Officer to determine the fair market value of the land as on the date of sale. This submission of the assessee is not acceptable for the fact that the assessee has not disputed the value adopted for the purpose of stamp duty before the SRO. The assessee has paid a stamp duty of Rs.12,54,800/- on the value adopted for purpose of stamp duty of Rs. 1,38,75,000/-. When this is the case, it is not correct on the part of the assessee to state that the market value of property was low and S.50C of the Act, should not be applied, from the layout of the property (enclosed to the sale deed) it was further observed that, the same is not completely surrounded by the lands of neighbors from all sides but in fact, to the northern corner of the land, leads towards west. In view of the above facts, there is no merit in the submission of the assessee that the land is lacking proper approach roads and hence it was sold for a value below the market value. In light of the above facts, the question of referring the valuation of the property to Department valuation officer does not arise. It should be further noted that the language used in S.50C of the Act is as follows: .... the Assessing officer may refer the valuation of the capital asset to a valuation officer.

As discussed above, the facts of the instant case does not warrant reference to the valuation officer.

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5.4. The assessee has further submitted that during the assessment proceedings u/s.143(3) r.w.s.153A the assessing officer verified all the materials and hence notice u/s. 148 of the Act cannot be issued. This submission of the assessee is not acceptable for the fact that in the assessment order passed u/s.143(3) r.w.s.153A, the issue of capital gain was never a matter of discussion. It is Pertinent here to repeat that in the said order the only addition made was Rs.14,40,000/- being the difference between the income admitted by the assessee vide his deposition dtd: 12/09/2008 and the income returned by the assessee in the return of income filed on 05/03/2010 in response to notice u/s.153A of the Act. Having admitted an income of Rs.60,00,000/- during the course of search it is not correct on the part of the assessee to claim at this point that the said land is an agricultural land and tax was paid on Long Term Capital Gain by mistake. 5.5. It is pertinent here to mention that the assessee's appeal questioning the validity of the assessment order passed on u/s. 143(3) 153A of the Act, and the addition of Rs.14,40,000/-, was dismissed by the Commissioner of Income Tax (Appeals)-VII, Hyderabad vide his order in Appeal No.1812/ACIT/CIT(A)-VII/10-11, dtd: 30/05/2011. It should be noted here that even during the appellate proceedings before the CIT(A), the assessee did not dispute the nature of the land (i.e agriculture or not). 5.6. Aggrieved by the above mentioned order of the CIT(A), the assessee filed an appeal before ITAT, Hyderabad. It is pertinent here to mention at the cost of repletion that even before the ITAT, the assessee did not raise the issue that the said land is an agriculture land. The ITAT vide its order in ITA No.1491/Hyd/2011, dtd.29.02.2012 allowed relief to the appeal of the assessee w.r.t. addition of Rs.14,40,000. From the above, it is evident that neither the issue of capital gain nor the issue of nature of land sold was the subject matter of assessee's before CIT(A) and the ITAT. 6.0. In view of the above facts and discussions, the long term capital gain or the assessee on the sale of land property situated at Sy.No. 124/1, Shamshabad Village, Shamshabad Mandal, Rangareddy Dist., is computed as follows by deeming the value adopted for the purpose of stamp duty as the full value consideration received or accruing as result of the above mentioned sale. Value adopted for the Purpose of stamp duty Rs.1,38,75,000/- Full Value consideration as admitted by the assessee for the purpose of computation of LTCG: Rs. 64,75,000/-

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Difference between (a) and (b) Rs. 74,00,000/- Assessee's share On the said property 50% on Rs.74,00,000/- Rs. 37,00,000/-

In view of the above discussion, an amount of Rs.37,00,000/- being 50% share of the value adopted for the purpose of stamp duty in excess of full value consideration admitted by the assessee is added to the income of the assessee Addition: Rs.37,00,000/-

8.0. It is pertinent here to mention that the object, scope and ambit of section 147 of the Act is well settled by the decision of the Hon'ble Supreme Court in CIT v Sun Engineering Works P. Ltd, [1992] 198 ITR 297. The Supreme Court, held as under : “As a result of the aforesaid discussion, we find that, in proceedings under section 147 of the Act, the Income-tax Officer may bring to charge items of income which escaped assessment other than or in addition to that item or items which have led to the issuance of the notice under section 148 and where reassessment is made under section 147 in respect of income which has escaped tax, the Income- tax Officer's jurisdiction is confined to only such income which has escaped tax or has been under assessed and does not extend to revising, reopening, or, reconsidering the whole assessment or permitting the assessee to reagitate questions which had been decided in the original assessment proceedings. It is only the underassessment which is set aside and not the entire assessment when reassessment proceedings are initiated. The Income-tax Officer cannot make an order of reassessment inconsistent, with the original order of assessment in respect of matters which are not the subject matter of proceedings under section 147. An assessee cannot resist validly initiated reassessment proceedings under this section, merely by showing that other income which had been assessed or was at too high a figure except in cases under section 152(2). The words “such income" in section 147 clearly refer to the income which is chargeable to tax but has "escaped assessment" and the Income-tax Officer’s jurisdiction under the section is confined only to such income which has escaped assessment, it does not extend to reconsidering generally the concluded earlier assessment, Claims which have been disallowed in the original assessment proceeding cannot he permitted to be re-agitated or the assessment being reopened for bringing to tax certain income which had escaped assessment because the controversy on reassessment is confined to matters which are relevant only in respect of the income which had not been brought to tax during the course of the original assessment. A matter not agitated in the concluded original assessment proceedings also

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cannot be permitted to he agitated in the reassessment proceedings unless relatable to the item sought to be taxed as “escaped income”. Indeed, in the reassessment proceedings for bringing to tax items which had escaped assessment, it would be open to an assessee to put forward claims for deduction of any expenditure in respect of that income or the non-taxability of the items at all. Keeping in view the object arid purpose of the proceedings under section 147 of the Act which are for the benefit of the Revenue and not an assessee, an assessee cannot be permitted to convert the reassessment proceedings at his appeal or revision, in disguise, and seek relief in respect of items earlier rejected or claim relief in respect of items not claimed in the original assessment proceedings, unless relatable to escaped income” and reagitate the concluded matters. Even in cases where the claims of the assessee during the course of reassessment proceedings relating to the escaped assessment are accepted, still the allowance of such claims has to be limited to the extent to which they reduce the income to that originally assessed. 8.1. In view of the ratio held in the above judgment, it is clear that the assessee cannot be permitted to convert the reassessment proceedings as his appeal or revision, in disguise, and seek relief in respect of items not claimed in the original assessment proceedings. As mentioned above, consequent to the search operation, the assessee admitted Rs. 60,00,000/- as his income vide his deposition dtd: 12.09.2008 and the same was assessed his income u/s. 143(3) r.w.s. 153A of the Act, which in turn was confirmed by the ITAT to an extent of Rs.45,60,000 (i.e. income as per consequential order dtd: 11.06.2012). This being the case, the assesses cannot utilize the occasion of reassessment proceedings (i.e. the present proceedings), as an opportunity to retract the income that was already admitted by him vide his deposition dtd:12.09.2008 consequent to the search operation. Hence the income of Rs.24,01,048 as returned by the assessee in the return of income filed by him on 23.01.2015 in response to notice U/s.148 of the Act, is ignored and the income of Rs.45,60,000 as confirmed by the ITAT vide its order in ITA No.1491/HYd/2011, dt: 29.02.2012 is hereby adopted for the computation of reassessed income of the assessee. 5.1. On the other hand, the AR contends as under: "Your appellant is an individual. He is the Managing Director of GVPR, Engineers Ltd at that time. A search and seizure operation was conducted on 28-07-2008 in the business and residential premises of your appellant in connection with Sri. Venkata Kutumba Rao & others. At the time of search the return for this assessment

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was not filed and admitted that Rs.60 lakhs would be the taxable income in his deposition dt.12-09-2008. In response to notice u/s 153A your appellant submitted return of income for AY 2007-08 on 5-3-2010, admitting net income of Rs. 45,60,602/- and agricultural income. The assessment u/s 143(3) rws 153A of IT Act was completed on 27.12.2010. In the said order, the Assessing Officer added an amount of Rs.14,40,000/- being the difference between the income returned and Rs.60 lakhs vide his deposition dated 12-09-2008. This was carried on appeal to CIT(A), who confirmed the addition and later the Hon'ble ITAT vide Order dated 29-02-2013 in ITA NO 347/Hyd/2011 deleted the entire addition of Rs.14,40,000/-. The returned income of Rs. 45,60,602/- included the following:

Income from Amount Rs. Salary 12,86,400 House Property 10,92,938 Capital Gains 21,59,554 Other sources 21,710 Gross Total Income 45,60,602 Agricultural Income

Your Appellant submits that the long terms capital gains offered to tax pertains to sale of agricultural land jointly held along with his son Sri. G. Siva Shankar Reddy, admeasuring Ac 4.14 Gts, situated at survey no.124/1, Shamshabad village & Grampanchayat, Shamshabad Mandal, Ranga Reddy Dist. Vide sale deed no. 15085/2006,. The then assessing Officer had obtained all the information including the copies of the sale and purchase deeds; The then Assessing Officer at the time of original assessment as well as the Assessing officer at the time of re-assessment relied on the same sale deed on record. There is no other evidence brought on record to say that income has escaped assessment . Your Appellant filed a return in response to the notice under section 148 on 23-01-2015, admitting an income of Rs. 24,01,048/- after reducing the long term capital gains of Rs. 21,59,554/- on the ground that it is sale at. agricultural lands being exempt from tax. Your Appellant also called for the reasons for issue of the said notice. The Assessing Officer provided the reasons and your Appellant filed objections for the same. The objections of your appellant have not been disposed of by an order as laid down by the Hon'ble Supreme Court in the case of GKN Driveshafts 259 ITR 19 (SC). Your Appellalnt therefore submits that the assessment under section 143(3) r.w.s 148

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is null and void. The Assessment has to be quashed. In this connection we rely on the following case laws: Even, if assuming that the assessment is valid, there is no tangible material brought on record, in fact the Assessing officer's has ignored the fact that the sale deed it self states that the land is agricultural land and the certificate submitted is only to support that the land is beyond 5 kms., as notified by CBDT, therefore this being agricultural land, is exempt from tax and provisions of section 50C are applicable. The Assessing Officer cannot just brush aside these facts on the ground that there was no dispute with regard to the capital gains in the original assessment nor in appeals filed. The then Assessing Officer after considering the deposition, return, all the documents and information filed during the course of assessment proceedings completed the assessment making an addition of Rs.14,40,000/- which was rightly deleted by the ITAT. The Assessing Officer ought to have dropped the re-assessment proceeding, after considering the fact that the land was agricultural land and provisions of section 50C do not apply, as agricultural lands are not Capital assets, as defined in the Act. The Assessing Officer is wrong in not referring the property to the Department Valuation Officer, as per provisions of section 50C. The Assessing Officer ignored the fact that as per section 50C(2), the Assessee has the right to request for reference to DVO only if there are no pending cases, the provision reads as under; (2) Without prejudice to the provisions of sub-section (1), where - (a) the assessee claims before any Assessing Officer that the value adopted or assessed by the stamp valuation authority under sub- section(1) exceeds the fair market value of the property as on the date of transfer; (b) the value so adopted or assessed by the stamp valuation authority under sub-section (1) has not been disputed in any appeal or revision or no reference has been made before any other authority, court or the High Court, the Assessing Officer may refer the valuation of the capital asset to a Valuation Officer and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clause (1) of sub-section (1) and sub-sections (6) and (7) of section 23A, subsection (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall, with necessary modification, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under sub-section (1) of section 16A of the Act.

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Explanation. -For the purposes of this section, "Valuation Officer” shall have the same meaning as in clause (r) of section 2 of the Wealth-tax Act, 1957 (27 of 1957). Your Appellant submits that from the reading of section 50C(2) (a) and (b) it is clear that on the request of the Assessee, the Assessing Officer may refer the property to the valuation officer, in the instant case the Assessing Officer has not referred the matter on the ground that there is no dispute before the SRO, which is not required by the Act. Therefore, the addition is not warranted. Further, it is well settled principals of law that even if by mistake any income is admitted to tax which is otherwise not taxable, this can be rectified, during the assessment proceedings or re-assessment proceedings. Therefore, the claim of your Appellant that the land is agricultural land and exempt from income tax being beyond 5 Kms., from Shamshabad, the addition is not warranted. The assessing officer has not disputed the fact that the land is not agricultural land. Further submitted that a notification of Government of Andhra Pradesh is enclosed to establish the fact that the said land has to be used as agricultural land and cannot be converted into non- agricultural or residential area. The Government bars from giving approvals for construction of houses. Even in light of this notification, the land is only agricultural land and the provisions of section 50C of the Income Tax Act, 1961 are not applicable, consequently, the addition on account of capital gains may be deleted being sale of agricultural Lands. Your appellant submits that the land being agricultural lands, it is not a capital asset with in the definition and hence provisions of section 50C are not applicable to the facts of this case and further being agricultural lands there is no tax payable”.

5.2 I have gone through the AO's observations and AR's contentions. It is seen from the facts that the AO has determined long term capital gains at Rs.37,00,000 being 50% share of the value adopted for the purpose of stamp duty in excess of full value consideration adopted by the assessee while computing the long term capital gain on the sale of his share of property of land admeasuring Ac 4.14 Gts (which the assessee jointly owned with his son G.Shiva Shankar Reddy) situated at Survey No.124/1, Sbamshabad Village Grampanchayat, Shamshabad Mandal, Rangareddy Dist. Vide sale deed no 15085/2006. While doing so, the AO stated as under: "5.2. Further, the assessee furnished a letter dt: Nil from some retired Inspector of survey, stating that the said property is 5 kilo meters away from Shamshabad area, This letter does not have any

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evidentiary value for the fact that it has been issued by an unidentified person, it, is not addressed to any authority/person in particular, the letter does not contain any date and the survey number of the land. It is seen that the sale deed mentions the land as 'agriculture land', but the assessee could not substantiate that said land is not situated within the jurisdiction of any municipal corporation or cantonment or notified area or within prescribed distance from the local limit of the above mentioned areas. In view of the above, there is no merit in the assessee's contention that the land that was sold by the assessee during F.Y.2005-07 is an agricultural one, Hence, the provisions of S. 50C of the Act is applicable to the assessee's case. 5.3. Further the assessee has submitted that since the agricultural land that was sold by the assessee was not having a proper approach road and the land was surrounded by the lands of the neighbors from all the sides, the land was sold for a price less than the market value fixed by the SRO. The assessee has further requested to refer the issue to the Department Valuation Officer to determine the fair market value of the land as on the date of sale. This submission of the assessee is not acceptable for the fact that the assessee has not disputed the value adopted for the purpose of stamp duty before SRO. The assessee has paid a stamp duty of Rs.12,54,800/- on the value adopted for the purpose of stamp duty of Rs.1,38,75,000/-. When this is the case, it is not correct on the part of the assessee to state that the market value of property was low and S.50C of the Act, should not be applied, From the layout of the property (enclosed to the sale deed) it was further observed that, the same is not completely surrounded by the lands of neighbors from all sides but in fact, to the northern corner of the land, there are two approach roads: one leads towards north and another leads towards west. In view of the above facts, there is no merit in the submission of the assessee that the land is lacking proper approach roads and hence it was sold for a value below the market value. In light of the above facts, the question of referring the valuation of the property to Department valuation officer does not arise”. 5.3. On the other hand, the AR contends that the land sold by the assessee is agricultural land which is beyond the limits as per the CBDT circular and hence the salke proceeds are not taxable. 5.4. After having gone through the above, I am of the considered view that the AO's action in determining the long term capital gain at Rs.37,00,000/- is justified. I fully agree with the reasoning given by the AO in determination of long term capital gain at Rs.37,00,000/-. The assessee's contention that the said land is agricultural, is not acceptable as it is not supported by corroborative evidence. Hence,

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the addition of Rs.37,00,000/- is hereby confirmed. As a result, the grounds raised are dismissed”. 4. The Revenue’s case in light of the CIT(A)’s foregoing detailed discussion is that since the assessee had failed to adopt SRO price for the purpose of computing capital gains, the same formed sufficient tangible material for the Assessing Officer to treat it as an instance of his taxable income having escaped assessment thereby triggering Section 148 mechanism in motion.

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issue of assessee’s land sold not forming a capital asset u/s.2(14) of the Act ought not to be allowed to be raised in Section 148/147 proceedings since the same is meant for the specific purpose to tax the income escaping assessment for the benefit of the department only. This argument fails to evolve our concurrence since applicability of Section 2(14) herein qua the assessee’s land sold goes to the very root of the matter. And also it might lead to the impugned capital gains addition without determination of the nature of the corresponding capital asset. The Revenue further fails to dispute that the case law Sunil Kumar Agarwal Vs. CIT (2014) [372 ITR 83] (Cal) holds that Section 50C(2) reference is mandatory even if there is no such prayer from the assessee’s side before the Assessing Officer. And that there is no indication about the nearest municipality under Article 243T r.w. Article 243P of the Constitution of India. We thus accept the assessee’s identical latter grounds of Section 50C addition and restore the same back to the Assessing Officer for his afresh adjudication after making the necessary reference to the DVO u/s.50C(2) of the Act. Ordered Accordingly.

Sd/- Sd/- (LAXMI PRASAD SAHU) (S.S.GODARA) ACCOUNTANT MEMBER JUDICIAL MEMBER Hyderabad, Dated: 30-04-2021 TNMM

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Copy to : 1.Sivapothuluru Veerareddy Gadluru, C/o.M.Anandam & Co., Chartered Accountants, 7A, Surya Towers, S.P.Road, Secunderabad.

2.Siva Shankar Reddy Gandluru, C/o.M.Anandam & Co., Chartered Accountants, 7A, Surya Towers, S.P.Road, Secunderabad. 3.The Asst.Commissioner of Income Tax, Circle-2(2), Hyderabad. 4.CIT(Appeals)-2, Hyderabad. 5.Pr.CIT-2, Hyderabad. 6.D.R. ITAT, Hyderabad. 7.Guard File.