VENKATESH PASHAM ,SECUNDERABAD vs. INCOME TAX OFFICER, WARD-13(3), HYDERABAD

The assessee has raised eight grounds in his appeal however, the crux of the issue is that the assessee is aggrieved by the order of the Ld. CIT (A) who had upheld the ex-parte order of the Ld. AO wherein he had made addition of Rs. 14,83,220/- towards LTCG invoking the provisions

The brief facts of the case are that the assessee is an employee working in Defence Research Development Organization (DRDO). As per the information received from SRO it was noticed by the Ld. AO that the assessee has sold a house property situated at 7-17, Subash Nagar Colony, Jeedimetala Village, Quthbullapur Mandal for sale consideration of Rs. 12 lakhs whereas the market value of the property as per the sale deed registered in the Sub-Registrar’s Officer dated 5/11/2007 was Rs. 17,00,000/-. Thereafter the Ld. AO issued notice U/s. 142(1) of the Act and further several show-cause letters were issued intimating the date of hearing. However, none appeared on behalf of the assessee at the time of hearing therefore, the Ld. AO passed ex-parte order based on the materials on the record and assessed the LTCG at Rs. 14,83,220/- invoking the provisions of section 50C of the Act by adopting the sale consideration at Rs. 17 lakhs. Before the Ld. CIT (A) the Ld. AR had argued stating that the Ld. AO had failed to refer the matter to the Ld. DVO for ascertaining the market value of the property sold by the assessee. It was further submitted that the actual market value of the property sold by the assessee was only Rs. 12 lakhs and the assessee could not get a better offer and therefore, was forced to sell at that price. However, the Ld. CIT (A) rejecting the submission of the Ld. AR upheld the order of the Ld. AO by observing as under:-

Before us, the Ld. AR argued by stating that the Ld. AO as well as the Ld. CIT (A) has erred by not referring the matter to the Ld. DVO for obtaining the market value of the property sold by the assessee but simply invoked the provisions of section 50C of the Act for the purpose of computing LCTG in the case of the assessee. It was therefore pleaded that the matter may be remitted back to the file of the Ld. AO with direction to obtain the market value of the property from the Ld. DVO and thereafter decide the issue in accordance with law and merit. The Ld. DR on the other hand vehemently opposed to the submissions of the ld. AR and prayed for confirming the order of the Ld. Revenue Authorities.

I have heard the rival submissions and carefully perused the materials on record, and I find merit in the submission of the Ld. AR. The assessee being an employee employed in DRDO would have been hard pressed for time which may have resulted in his non-appearance before the Ld. Revenue Authorities on the date of hearing. Further, considering the facts of the case, it is evident that the difference between the market value as per SRO and the actual price for which the

In the result, appeal of the assessee is allowed for statistical purposes.