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Income Tax Appellate Tribunal, RAJKOT – RAJKOT BENCH
Before: SHRI RAJPAL YADAV & SHRI AMARJIT SINGH
आदेश/O R D E R
PER AMARJIT SINGH - AM: The appeal filed by the assessee for A.Y. 2007-08, arise from order of the CIT(A)-1, Rajkot dated 22.12.2017, in proceedings under section 143(3) r.w.s. 147 of the Income Tax Act, 1961; in short “the Act”.
The solitary ground of appeal of the assessee is against the decision of Ld. CIT(A) in confirming the addition on account of long-term capital gain to the amount of Rs. 2,09,950/-.
The fact in brief is that assessee has filed return of income declaring income of Rs. 1,02,734/- on 31.07.2007. Subsequently, the case was reopened u/s. 147 of the Act by issuing of notice u/s. 148 of the Act on 25.02.2014 on the ground that as per the information the assessee has sold flat No. 201 at Nilkant Apartment, Rajkot for consideration of Rs. 4,90,000/- however, the Stamp Valuation Authority had adopted the value of the property at Rs. 7,60,860/- and assessee has not shown the capital gain
ITA No. 23/RJT/2018(Shri Rajesh Kuverjibhai Nandni vs. ITO) A.Y. 2007-08 2 from the aforesaid transaction according to Sec. 50C of the Act. Considering the above fact we do not find any error in the action of the AO in reopening the assessment u/s. 147 of the Act, therefore, first ground of appeal of the assessee is dismissed.
During the course of assessment proceeding the assessee has made reference to the Department Valuation Officer for determination of fair value of the property u/s. 55A of the Act. The Valuation Officer has estimated the fair market value of the property at Rs. 9,71,800/- on 10.07.2016. Thereafter, the AO has determined the long-term capital gain at Rs. 20,09,950/- after taking into consideration the fair market value of the sold property determined by the Department Valuation Officer at Rs. 9,71,800/-.
The assessee has preferred appeal before the Ld. CIT(A). The Ld. CIT(A) has dismissed the appeal of the assessee.
We have heard the rival contention and perused the material on record and noticed that Ld. CIT(A) has wrongly interpreted the provision of Sec. 50C(3) of the Act while adjudicating the appeal of the assessee stating that full value of consideration if to be taken as determined by the DVO. In this regard, we have perused to provision of Sec. 50C(3) of the Act which is reproduced as under:-
“(3) Subject to the provisions contained in sub-section (2), where the value ascertained under sub-section (2) exceeds the value adopted or assessed [or assessable] by the stamp valuation authority referred to in sub-section (1), the value so adopted or assessed [or assessable] by such authority shall be taken as the full value of the consideration received or a accruing as a result of the transfer.]”
It is clear from the above cited provision of Sec. 50C(3) that where the value ascertained under sub-section (2) exceed the value adopted or assessed by the stamp valuation authority refer to in sub-section (1) the value so adopted or assessed by such authority shall be taken as the full value of consideration received or accruing as a result of the transfer. Since, the fair market value determined by the department valuation officer has exceeded the value determined by the stamp valuation authority, therefore, as per provision of Sec. 50C(3) of the Act the value adopted by the stamp
ITA No. 23/RJT/2018(Shri Rajesh Kuverjibhai Nandni vs. ITO) A.Y. 2007-08 3
valuation authority shall be taken as the full value of the consideration on the sale of the property. In view of the above facts and findings we are not inclined with the decision of the Ld. CIT(A). Therefore, the AO is directed to compute the long-term capital gain after adopting the sale price of Rs. 7,60,863/- as determined by the stamp valuation authority. Therefore, the appeal of the assessee is allowed.
In the result, appeal of the assessee is partly allowed.
[Order pronounced in the Court on 23-09-2019.]
Sd/- Sd/- (RAJPAL YADAV) (AMARJIT SINGH) JUDICIAL MEMBER TRUE COPY ACCOUNTANT MEMBER Ahmedabad; Dated 23/09/2019 TANMAY आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. अपीलाथ�/ The Appellant 2. ��यथ�/ The Respondent. 3. संबं�धतआयकरआयु�त/ Concerned CIT 4. आयकरआयु�त(अपील) / The CIT(A) 5. �वभागीय��त�न�ध, आयकरअपील�यअ�धकरण/ DR, ITAT, 6. गाड�फाईल / Guard file. आदेशानुसार/ BY ORDER
उप/सहायकपंजीकार (Dy./Asstt. Registrar) आयकरअपील�यअ�धकरण, अहमदाबाद / ITAT, Rajkot
Date of dictation : 17-09-2019 2. Date on which the typed draft is placed before the : 18 -09-2019 Dictating Member. 3. Date on which the approved draft comes to the : 20-09-2019 Sr.P.S./P.S 4. Date on which the fair order is placed before the : 20-09-2019 Dictating Member for pronouncement. 5. Date on which fair order placed before Other Member : 6. Date on which the fair order comes back to the : 23 -09-2019 Sr.P.S./P.S. 7. Date on which the file goes to the Bench Clerk. : 23 -09-2019 8. Date on which the file goes to the Head Clerk. : 9. The date on which the file goes to the Assistant : Registrar for signature on the order. 10. Date of Despatch of the Order :