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Income Tax Appellate Tribunal, “A” BENCH, AHMEDABAD
Before: SHRI RAJPAL YADAV & SHRI PRADIP KUMAR KEDIA
The captioned appeal has been filed at the instance of the Revenue against the order of the Commissioner of Income Tax (Appeals)-2, Ahmedabad (‘CIT(A)’ in short), dated 04.12.2017 arising in the assessment order dated 03.03.2015 passed by the Assessing Officer (AO) under s. 143(3) of the Income Tax Act, 1961 (the Act) concerning AY. 2012-13.
When the matter was called for hearing, none appeared for the assessee. The matter was accordingly proceeded ex parte.
The grounds of appeal raised by the Revenue read as under:
“1 The Ld. CIT(A) has erred in law and on facts by simply accepting the valuation as per the DVO's report. 1.1 The Ld. CIT(A) erred in law in not appreciating that the DVO's report may be binding on the AO, but is never binding on the Appellate Authority. 1.2 The Ld. CIT(A) erred in law and on facts by not appreciating that the said Report of the DVO had been prepared arbitrarily and without making any reference to the prevailing Jantri Rate, which has not only rendered the whole section 50C otiose and redundant but also the concept of Jantri Rates which are published by the local government after ascertaining the ground reality. 1.3 The Ld. CIT(A) has erred in law and on facts by not appreciating that the said Report of the DVO has been prepared arbitrarily as the DVO has arrived at value of such plots @Rs. 1977/-per sqm on 31.03.2012, @ Rs. 2140/-per sqm on 31.03.2013 and @ Rs. 2414/- per sqm on 31.03.2014, without any rational basis. 2 The Ld. CIT(A) has erred in law and on facts by not appreciating that the reference made by the DVO to certain sale rates as per the available Registration deeds was arbitrary as the DVO has failed to appreciate that in the instant case almost 48%-50% area had been left for the Roads and other amenities, which has not been factored by the DVO while valuing such plots of land. 3 The Ld. CIT(A) has erred in law and on facts in not appreciating the fact that in its valuation report, the DVO, for determination of FMV has not considered the factors as delineated by the Hon'ble Apex Court in the case of Chimanlal Hargovinddas vs Special Land Acquisition Officer AIR 1988 SC 1652,1656-58.”
We have carefully considered the submissions made on behalf of the Revenue in its appeal. As pointed out, during the year under consideration, the assessee has sold 131 plots of land for total consideration of Rs.2,82,35,000/- whereas its value adopted by Stamp Duty Authority is Rs. 5,53,13,965/-. In the course of scrutiny assessment, the AO has substituted the full value of consideration at Rs.5,53,13,965/- in view of special provisions of Section 50C of the Act and consequently added the amount of Rs.2,70,78,965/- as capital gains in the hands of the assessee. The assessee however defended her case by submitting a valuation report from the Government Approved Registered Valuer, which was not taken cognizance by the AO.
In the first appeal, the assessee reiterated its submission for adopting the value assigned by the registered valuer. The CIT(A) found merit in the plea of the assessee to some extents and granted partial relief having regard to the District Valuation Officer valuation report. The relevant operative para of the order of the CIT(A) is reproduced hereunder:
“2.3. Decision:
I have carefully considered the facts of the case, assessmenf order and submissions of the appellant. The appellant has shown 131 plots for Rs.2,82,35,000/-. However, as per the stamp valuation authority, the value assessed was at Rs.5,53,13,965/-. The AO, therefore, invoking the provisions of section 50C made the addition of Rs.2,70,78,965/-. The appellant has contended that value determined by stamp valuation authority was much higher and had filed detailed objection before the AO on 18/02/2005. The appellant has also submitted valuation report from the government approved registered valuer, however, the AO ignoring the provisions of Section 50C without making reference to the DVO adopted the value assessed by stamp valuation authority as a deemed consideration. The property in subsequent assessment was referred to the DVO for valuation as on 31/03/2012, 31/03/2013 and 31/03/2014 as the property was sold in three years. The valuation given by the DVO is as under:-
Sl. Property Estimated Declared As on No. Value (Rs.) Value (Rs.)
1 Plots having S. No. 430 2,94,68,905/- Not Known 31/03/2012 and 431, Mehtapura Civil Camp Area, Near Border of Parbada and Savagadh Village, Himmatnagar 3,24,32,214/- Not Known 31/03/2013
6,07,00,778/- Not Known 31/03/2014
2.4. The AO in the assessment order u/s. 143(3) for Assessment Year 2013- 14 has taken deemed value of consideration as determined by the DVO at Rs.3,24,34,214/-. The AO in the Assessment Year 2014-15, has taken the deemed value of consideration at Rs.7,58,50,733/- on the basis of stamp value authority in his order u/s. 143(3). The AO has subsequently, vide order dated 29709/2017 has rectified the order u/s. 154 by taking the value of consideration at Rs.3,51,33,250/- as determined by DVO. Considering the above facts, the AO is directed to take the full value of the consideration as assessed by the DVO as per section 50C(3). In view of the above, the grounds of appeal are partly allowed.
[ACIT vs. Smt. Jitendrakumari D. Jadeja] A.Y. 2012-13 - 4 - 6. As can be noticed from the order of the CIT(A), the full value of consideration as assessed by District Valuation Officer as per Section 50C(3) of the Act was adopted for the purposes of determination of capital gains. We do not see any error in the aforesaid approach of the CIT(A). We thus see no merit in the appeal of the Revenue. Be that as it may the tax effect of the dispute raised by the Revenue also appears to be less than Rs.50 Lakhs and accordingly hit by recently issued CBDT Circular No.17 of 2019 dated 08/08/2019. Therefore, seen from any angle the appeal of the Revenue is not sustainable.
In the result, appeal filed by the Revenue is dismissed.
This Order pronounced in Open Court on 13/11/2019
Sd/- Sd/- (RAJPAL YADAV) (PRADIP KUMAR KEDIA) JUDICIAL MEMBER ACCOUNTANT MEMBE Ahmedabad: Dated 13/11/2019 True Copy S. K. SINHA आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व / Revenue 2. आवेदक / Assessee 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त- अपील / CIT (A) 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाइल / Guard file. By order/आदेश से,
उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद ।