SHRI BABARAM R. KADAM,MUMBAI vs. ITO -1(1), MUMBAI
What did the Tribunal hold?
The Tribunal held that when the assessee objected to the valuation, the revenue authorities should have referred the matter to the District Valuation Officer (DVO) for proper valuation as per the Act. The issue was remitted back to the AO for this purpose.
What were the facts?
The assessee sold a residential flat for Rs. 20,50,000, but the stamp duty valuation was Rs. 31,00,500. The AO made an addition of the difference under Section 50C, as the assessee failed to respond to notices.
What were the issues?
Whether the AO correctly applied Section 50C without referring the property valuation to the DVO when the assessee raised objections.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, “SMC” Bench, Mumbai
Before: Shri Shamim Yahya
This appeal by the assessee is directed against the order of learned Commissioner of Income Tax (Appeals), dated 23.03.2021 and pertains to assessment year 20115-16. The ground raised is that ld.CIT(A) erred in confirming the addition of Rs. 10,50,500/- made by the AO u/s 50C of the Act.
Brief facts of the case are that in the course of assessment AO noted that assessee has sold immovable property being residential flat for agreement value of Rs. 20,50,000/-. However, as per the stamp valuation authority value is Rs. 31,00,500/-, so there was difference of Rs. 10,50,500/-. AO referred to the provision of section 50C of the Act and noted that when the provision of law was brought to the notices to assessee during the course of assessment proceedings. Assessee failed to make any response. Thereafter, AO again given show-cause notice to the asssesee. Assessee did not respond. Hence, AO added the same to the income of the assessee u/s. 50C of the Act. Before the first appellate authority, it was noted that assessee has stated that the flat was not developed in the building. That the building is situated in place where amenities/facilities are lacking. That in the same building, other Flats were sold much below market price. However, the first appellate authority dismissed the submission by noting that assessee has not given any concrete evidence.
Against the order assessee is in appeal before the ITAT.
Upon careful consideration, I find that when assessee has objected to the valuation, it is incumbent upon revenue authorities to send the matter to D.V.O for valuation as per the prescription of the Act. Hence, I remit this issue to the AO to follow the above direction.
In the result, assessees appeal allowed for statistical purpose.
More judgments on Section 50C
- M N S Barium Salts, Kadapa vs ITO, Ward-1, KadapaITA 2412/HYD/2025[2020-21]Status: Disposed16 Oct 2026AY 2020-21
- Sawalchand Chunilal Bafna HUF, Mumbai vs Income Tax Officer-16(1)(1), MumbaiITA 7492/MUM/2025[2011-12]Status: Disposed16 Oct 2026AY 2011-12
- Jagdishbhai Vasharambhai Italiya, Ahmedabad vs The ITO, Ward-3(1)(1), AhmedabadITA 150/AHD/2026[2015-16]Status: Disposed14 Oct 2026AY 2015-16
- Rohini Ramhari Bhadale, Pune vs Assessing Officer Ward 2(2) Pune, PuneITA 2767/PUN/2026[2015-2016]Status: Disposed14 Oct 2026AY 2015-2016
- Sweta Somani, Kolkata vs ITO, Ward 44(2), KolkataITA 1656/KOL/2026[2015-2016]Status: Disposed14 Oct 2026AY 2015-2016
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