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Facts
The assessee, engaged in Dairy Farming and Brokerage, sold a plot of land for Rs. 1,02,15,682/-. The stamp valuation authority valued it at Rs. 4,23,68,750/-. The assessee's share was 15%. The AO invoked Section 50C, treating the difference as capital gains, rejecting the assessee's claim of business income.
Held
The Tribunal directed the Assessing Officer to adopt the valuation report from other co-owners' cases, considering the assessee's 15% share and providing an opportunity for hearing. The addition of Rs. 63,53,312/- was to be reassessed based on this valuation.
Key Issues
Whether the AO was justified in invoking Section 50C by rejecting the claim of business income and whether the valuation adopted was correct.
Sections Cited
143(3), 147, 148, 50C, 271(1)(c)
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Income Tax Appellate Tribunal, AHMEDABAD “A” BENCH
Before: Shri T.R. Senthil Kumar & Shri Narendra Prasad Sinha
Assessment Year: 2012-13 Vasantiben Chimanbhai The DCIT, Patel Circle Palanpur, Ambica Nagar Society, Vs Palanpur Railway Station Char Rasta At: Manund, Tal: Patan, Patan-384260,Gujarat PAN: AMXPP9760D (Respondent) (Appellant) Assessee Represented: Shri Mehul K Patel, A.R. Revenue Represented: Shri B.P. Srivastava, Sr. D.R. Date of hearing : 04-08-2025 Date of pronouncement : 28-08-2025 आदेश/ORDER PER : T.R. SENTHIL KUMAR, JUDICIAL MEMBER:-
This appeal is filed by the Assessee as against the appellate order dated 26.12.2023 passed by the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, Delhi, (in short referred to as “CIT(A)”), arising out of the assessment order passed under section 143(3) r.w.s. 147 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) relating to the Assessment Year 2012-13.
A.Y. 2012-13 Page No 2 Vasantiben Chimanbhai Patel Vs. DCIT
Brief facts of the case is that the assessee is an individual engaged in the business of Dairy Farming and Brokerage. Assessee filed her original Return of Income for the Asst. Year 2012-13 on 19-10-2012 declaring total income of Rs.3,80,720/-. Information received that a plot of land located at Jambuua, Baroda in R.S. No. 422 measuring 6889 Sq. Mtr. sold for consideration of Rs.1,02,15,682/-, whereas the stamp valuation authority valued the property at Rs.4,23,68,750/- for stamp duty purpose. Assessee holds 15% share in a plot of land. Hence the difference in stamp duty valuation is brought to tax invoking Section 50C of the Act by issuing a notice u/s. 148 of the Act dated 27-11-2018. The assessee filed return on 12-01-2019 declaring the same total income of Rs.3,96,760/- and claimed the property on sale is already declared as business income, hence no question of invoking of Section 50C arise. The Assessing Officer held that no opening stock of land or closing stock of land shown by the assessee in the Return of Income, therefore the claim of business income was rejected and difference in sale consideration and assessee’s 15% share of Rs. 63,53,312/- is added u/s. 50C of the Act and demanded tax thereon.
Aggrieved against the reassessment order, assessee filed an appeal before Ld. CIT(A) who was also confirmed the addition holding that the question of reference to Valuation Officer is not mandatory, when requisite information is already available with the A.O. Thus dismissed the appeal filed by the assessee.
A.Y. 2012-13 Page No 3 Vasantiben Chimanbhai Patel Vs. DCIT
Aggrieved against the same, the assessee is in appeal before us raising the following Grounds of Appeal:
(1) That on facts, in law, and on evidence on record, the learned National Faceless Appeal (NFAC) has grievously erred confirming the reopening of assessment u/s 147 Centre of the Act. (2) That on facts, in law, and on evidence on record, the learned National Faceless Appeal (NFAC) has grievously erred confirming the action of AO in treating the Centre on sale of in surplus immovable property as Capital Gains instead accepting it as Business income, as declared by appellant. (3) That on facts, in law, and on evidence on record, the learned National Faceless Appeal Centre (NFAC) has grievously erred in confirming the addition of Rs.63,55,312/- made u/s 50C of the Act. (4) Alternatively, the learned National Faceless Appeal Centre (NPAC) has grievously erred in not directing the AO to adopt the full value of sale consideration as valued by Department Valuation Officer (DVO) in the case of co-owners of same property. (5) Alternatively, the learned National Faceless Appeal Centre (NFAC) has grievously erred in directing the AO to give deduction in not respect of Cost of Acquisition of the property. (6) That on facts, in law, and on evidence on record, the learned National Faceless Appeal not Centre (NFAC) has grievously erred in accepting the fact that the addition made by AO has resulted double addition as the in appellant has already disclosed the surplus as Business Income in return filed. (7) The appellant craves leave to add, alter, amend any ground of appeal
5. Though various grounds are raised by the assessee, Ld. Counsel placed before us other co-owners assessment of the very same property wherein the case was reopened and referred to Valuation Officer who determined the value of the property at Rs. 1,57,00,164/- as on 27-06-2011 and that assessee’s share 15% is A.Y. 2012-13 Page No 4 Vasantiben Chimanbhai Patel Vs. DCIT determined at Rs. 23,55,025/- same may be allowed in the case of the assessee who is also one of the co-owner holding 15% of share in the property.
Ld. Sr. D.R. appearing for the Revenue could not dispute the valuation report dated 29-09-2017 made by Valuation Officer for the very same property bearing R.S. No. 422 Moje-Jambuva, Vadodara.
Further in the case of Neeta Ashokkumar Dalwadi other co- owner for the very same Asst. Year 2012-13, ITO, Ward-3(1)(5) vide order dated 02-12-2019 after considering the DVO’s valuation report held as follows: “Further, it is noticed that the assessee has submitted the assessment proceedings for the A.Y. 2012-13 has been finalized in the case of Shri Ajit Patel (PAN: AREPP9376P), who was co-owner in the Immovable property situated at R.S.No.422 at Jambua, Baroda admeasuring area 6889 sq. meter. The assessee has also submitted the copy of Assessment order of Shri Ajit Patel finalized by the ITO, Ward-3(1)(2), Vadodara u/s. 143(3) r.w.s. 147 of the Act dated 12-10-2017 for the A.Y. 2011-12 and it is noticed that the Assessing Officer has referred the aforementioned Immovable property to the Valuation Officer, Vadodara for valuation and the Valuation Officer vide order u/s. 50C of the Act dated 29-09-2017 valued the property at Rs.1,57,00,164/- as on 27-06-2011. The assessee was having 15% share in the property so, the assessee was required to adopt the amount of Rs.23,55,025/- i.e. 15% of 1,57,00,164/-(The Jantri valuation) as full value consideration as per provisions of 50C of the 1. T. Act. As the Valuation Officer has already done the valuation of the aforementioned property and it was noticed that land in question was purchased at amount of Rs.8,40,000/- during the F.Y.2009-10, the calculation of the income under head capital gain u/s. 50C of the Act can be reproduced as under: Full Value consideration of the property Rs. 23,55,025/- Cost of acquisition Rs.8,40,000/- Income under head capital Gain Rs. 15,15,025/- A.Y. 2012-13 Page No 5 Vasantiben Chimanbhai Patel Vs. DCIT
In view of these discussions, the amount of Rs. 15,15,025/- Is added to the total income of assessee of per provisions of section 50C of the Act. Penalty proceedings u/s. 271(1)(c) of the Act has been initiated for concealment of the particulars of Income on Rs.15,15,025/-.”
Thus, we direct the assessing officer to adopt the same valuation report in assessee’s case being another co-owner holding 15% share and by giving proper opportunity of hearing to the assessee.
In the result, the appeal filed by the Assessee is allowed for statistical purpose.
Order pronounced in the open court on 28 -08-2025 Sd/- Sd/- (NARENDRA PRASAD SINHA) (T.R. SENTHIL KUMAR) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad : Dated 28/08/2025 आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/आदेश से,
उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद