SHRI SHIV RAM SAINI,JAIPUR vs. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-7, JAIPUR

The first ground of appeal relates to addition of Rs. 4,47,150/- on account of different in the DLC value and the sale consideration shown by the assessee. The assessee had sold two properties in the A.Y.

2 ITA 912/JP/2018 Shri Shiv Ram Saini Vs DCIT 2013-14. During the year under consideration, the assessee had shown long term capital gain at Rs. 20,31,280/- on the sale consideration of Rs. 2,11,96,000/-[Total of both property]. During the course of assessment proceedings, it was noticed by the AO that the Sub-registrar had taken value of the said property at Rs. 2,16,75,578/- for the purpose of charging stamp duty. The AO, accordingly replaced the sale consideration with Rs. 2,16,75,578/- for calculating capital gain.

It was the contention of the ld AR of the assessee that since the difference was near about 10%, the same should be avoided and he further contended that the A.O. has not referred the matter to the DVO.

I have heard the rival contentions and carefully gone through the orders of the authorities below and found that the A.O. has made addition U/s 50C of the Act by adopting the DLC value. As and when the A.O. do not accept the sale considering shown by the assessee, the matter should be referred to the DVO. However, in the instant case, the A.O. has not made the reference to the DVO, therefore, in the substantial interest of justice, I restore the matter back to the file of the A.O. for 3 ITA 912/JP/2018 Shri Shiv Ram Saini Vs DCIT making reference to the DVO and for deciding the issue afresh as per law after providing due and effective opportunity of hearing to the assessee.

The next grievance of the assessee relates to addition of Rs. 6,10,740/- on account of capital gains by ignoring the cost of improvement. From the record, I found that the assessee had shown Rs. 6,10,740/- as has been incurred by the assessee for the leveling work of the lands. Same has been claimed as a Cost of Improvement in the ITR. This work has been done by Mr. Shankar Lal Banjara. Payment has been made in cash to Mr. Shankar Lal for which. cash receipt on Re. 1 revenue stamp has been issued by the Shankar Lal. Same has been produced before the AO during the assessment proceedings. However, the A.O. declined claim on the plea that the assessee was not having sufficient cash on the date of payment. Our attention was invited by the ld AR to the bank statement of Bank of India, Sanganer Branch, wherein as on 23/1/2011, the assessee had withdrawn cash of Rs. 9.10 lacs out of which Rs. 6,10,740/- was paid as a cost of leveling. It appears that this bank statement was not produced before the lower authorities. Since it goes to the root of the issue to explain the availability of cash out of the said withdrawal, in all fairness, I restore this issue bank to the file of the A.O. for considering the cash

In the result, appeal of the assessee is allowed for statistical purposes only. Order pronounced in the open court on 22nd July, 2019