BANTWAL MADHAVA BALIGA,BANGLAORE vs. INCOME TAX OFFICER, KORAMANGALA

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ITA 929/BANG/2026Status: DisposedITAT Bangalore05 August 2026AY 2023-244 pages
AI SummaryRemanded

What did the Tribunal hold?

The Tribunal held that while the assessee's claim for fair market value as of 01/04/2001 was supported by a valuer's report, it was not placed before the lower authorities. Therefore, the issue was remitted back to the AO for fresh consideration.

What were the facts?

The assessee claimed indexation on long-term capital gains, which was disallowed by the AO and confirmed by the CIT(A). The assessee argued that the fair market value adopted as of 01/04/2001 was correct and supported by a valuer's report.

What were the issues?

Whether the fair market value as on 01/04/2001 adopted by the assessee for calculating long-term capital gains is correct and whether the valuer's report should be considered.

Which sections of the Income-tax Act were involved?

Section 48,Section 55(2)(b)(ii)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, BANGALORE BENCHES, BANGALORE

Before: SHRI WASEEM AHMED & SHRI SOUNDARARAJAN K.

आयकर अपीलीय अधिकरण, बेंगलुरू पीठें, बेंगलुरू INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCHES, BANGALORE BENCH: SMC BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER ITA No. 929/Bang/2026 नििधारण वर्ा/Assessment Year: 2023-24) Bantwal Madhava Baliga The Income Tax Officer B-202, Salapuria Symphony BMTC building, 80 feet road, Apartment, 6th Block, Koramangala, Hosur Main Road, Vs. Bengaluru-560034, Electronic City, Karnataka. Bangalore – 560 100. अपीलधर्थी Appellant प्रत्यर्थी Respondent

Permanent Account Number of ABIPB7940B Assessee:

अपीलधर्थी द्वधरध/Appellant represented by: Ms. Neha Jain, CA प्रत्यर्थी द्वधरध/Respondent represented Shri. Ganesh R Ghale, Standing Counsel for the Dept. by: सुनवाई की तारीख / Date of conclusion of hearing: 08-06-2026 घोषणा की तारीख / Date of pronouncement: 05-08-2026 आदेश / ORDER PER SHRI SOUNDARARAJAN K., JUDICIAL MEMBER: This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 30/12/2025 in respect of the A.Y. 2023-24.

2.

The brief facts of the case are that the assessee is an individual and filed his return of income on 06/07/2023. The said return was processed u/s. 143(1) of the Act and an addition of Rs. 16,17,000/- was made by disallowing the indexation value of long term capital gain. Thereafter the 1

ITA No. 929/Bang/2026 Bantwal Madhava Baliga assessee filed rectification request which was not accepted by the AO. As against the said rejection order, the assessee filed an appeal before the Ld.CIT(A). The Ld.CIT(A) had confirmed the order of the AO.

3.

As against the said order, the present appeal has been filed by the assessee before this Tribunal.

4.

At the time of hearing, the Ld.AR submitted that the AO as well as the Ld.CIT(A) had not given the deduction u/s. 48 of the Act which was claimed in the ITR. The Ld.AR further submitted that fair market value adopted by the assessee almost tallies with the approved valuer’s report and therefore on the basis of some technical errors, the capital gain claimed by the assessee could not be enhanced. The Ld.AR further submitted that the cost of acquisition and improvements u/s. 48 on the fair market value of the property while arriving the capital gains by the assessee is in order since the fair market value has been taken as on 01/04/2001 which is in order and therefore prayed that the correct value has to be adopted by the authorities instead of the lesser value adopted by them while calculating the capital gains. The Ld.AR further submitted that since the property has been purchased in the year 1992 and therefore submitted that the fair market value as on 01/04/2001 has been correctly taken as the cost of acquisition and therefore prayed that the appeal may be allowed.

5.

The Ld.DR relied on the orders of the lower authorities and submitted that the government approved valuer’s report has not been filed before the lower authorities and therefore prayed to dismiss the appeal.

6.

We have heard the arguments of both sides and perused the materials available on record.

7.

In this appeal, the assessee had computed the capital gains by taking the purchase value effected during the year 1992 and based on that, he has arrived the indexed cost of acquisition at Rs. 7,00,000/- as on 01/04/2001 since the property has been purchased before the said date. As per section

ITA No. 929/Bang/2026 Bantwal Madhava Baliga 55(2)(b)(ii) of the Act, the cost of acquisition of the asset, based on the option exercised by the assessee, has to be taken as the fair market value as on 01/04/2001. By relying on the above said provision, the assessee had exercised his option and claimed the cost of acquisition as the fair market value of the property as on 01/04/2001. In support of the said fair market value, the assessee is also producing a report given by the registered valuer which is almost equal to the value declared by the assessee while calculating the capital gain. The said valuation report was not placed before the authorities and therefore they were not having an opportunity to examine the same and accept the value. In such circumstances, the technical defects pointed out by the authority could not be a reason for not accepting the fair market value adopted by the assessee as on 01/04/2001. Further, the valuation report also supports the value adopted by the assessee while calculating the capital gains. Therefore, in the interest of justice, we are inclined to grant one more opportunity to the assessee to place the registered valuer’s report before the AO and substantiate his claim that the computation of the capital gain is in order. We, therefore, set aside the orders of the lower authorities and remit this issue to the file of the JAO for considering the issue afresh based on the valuation report and any other documents relied on by the assessee.

8.

In the result, the appeal filed by the assessee is allowed for statistical purposes. Order pronounced in the open court on 05th August, 2026.

Sd/- Sd/- WASEEM AHMED SOUNDARARAJAN K. ACCOUNTANT MEMBER JUDICIAL MEMBER

Bangalore Dated: 05th August, 2026.

ITA No. 929/Bang/2026 Bantwal Madhava Baliga Copy to: Bantwal Madhava Baliga, B-202, Salapuria Symphony Apartment, 1 Hosur Main Road, Electronic City, Bengaluru – 560 100. Income Tax Officer, BMTC Building, 80 feet road, 6th Block 2 Koramangala, Bengaluru-560034, Karnataka. 3 The PCIT / CIT, 4 The D.R., ITAT, Bangalore Bench

BY ORDER

ASSISTANT REGISTRAR, I.T.A.T., BANGALORE.

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