M/S DHANALAKSHMI MILLS LTD,TIRIPUR vs. DCIT,CIRCLE-1, TIRUPUR

per provisions of section 50C of the Act cannot be subject

matter of revision proceedings for the impugned assessment

year.

6 ITA No. 153/Chny/2021

learned PCIT submitted that facts brought on record in the

order of the PCIT, clearly proves that the Assessing Officer

has failed to apply his mind in light of provisions of section 50C

of the Act, which rendered the assessment order to be

erroneous, insofar as it is prejudicial to the interests of revenue

and thus, the PCIT has rightly set aside assessment order by

exercising his powers conferred u/s.263 of the Act, and their

orders should be upheld.

available on record and gone through orders of the authorities

below. The facts with regard to impugned dispute are that the

assessee has sold property vide document No. 2239 / 2006 for

consideration of Rs.2,62,30,000/-. Further, although transaction

of sale took place in financial year relevant to the assessment

year 2006-07, but the assessee itself had declared capital gain

from transfer of property for the assessment year 2015-16 on

the ground that possession of property has been handed over

to buyer in the financial year 2014-15 relevant to the

assessment year 2015-16. From the above, it is very clear that

7 ITA No. 153/Chny/2021

for the purpose of computation of capital gains transfer had

been taken place for the assessment year 2015-16. It was

further noted that there is difference between stated

consideration received for transfer of property and guideline

value of property as on date of registration, as per which the

assessee claims to have received consideration of

Rs.2,62,30,000/-, whereas guideline value of property has

been fixed by the Registration Department at Rs.4,10,70,379/-

and said value has been determined by the Stamp & Registration Department on 11.02.2009. From the above, it is

very clear that there is difference between stated consideration

in the document and guideline value of property.

assessment order passed by the Assessing Officer and order

of the PCIT passed u/s.263 of the Act, we need to understand

whether the PCIT is right in exercising his powers u/s.263 of the

Act or not. Admittedly, the Assessing Officer has caused

necessary inquiries with regard to computation of long term

capital gain derived transfer of property and has computed capital gain by taking into account cost of acquisition claimed by

8 ITA No. 153/Chny/2021

the assessee without disturbing consideration received from

transfer of property, even though, there is difference in

guideline value of property. From order of the Assessing

Officer, what we could notice is that although, provisions of

section 50C could have been applied in the given facts and

circumstances of the case, but the Assessing Officer has failed

to apply provisions of section 50C to determine correct

consideration received for transfer of property. The PCIT, after

verifying necessary evidences in light of various facts bought on

record by the Assessing Officer has opined that the

assessment order passed by the Assessing Officer is

erroneous, insofar as it is prejudicial to the interests of revenue

on the issue of computation of long term capital gain from

transfer of property, because the Assessing Officer has failed

to apply provisions of section 50C of the Act, while completing

assessment. In our considered view, the Assessing Officer has

failed to apply his mind in light of facts of the case to relevant

provisions of section 50C of the Act, while completing

assessment. Hence, the PCIT has rightly exercised his

jurisdiction u/s.263 of the Act and set aside the assessment

order, because the assessment order passed by the Assessing

9 ITA No. 153/Chny/2021

Officer is erroneous, insofar as it is prejudicial to the interests

of revenue. Therefore, we are of the considered view that there

is no error in the reasons given by the ld. PCIT to set aside the

assessment order and thus, we are inclined to uphold findings

of the learned PCIT and dismiss appeal filed by the assessee.

Sd/- Sd/- (महावीर �संह) (जी. मंजुनाथ) (Mahavir Singh) (G. Manjunatha ) उपा�य�/ Vice-President लेखा सद%य / Accountant Member चे'नई/Chennai, (दनांक/Dated 13th July, 2022 DS आदेश क� ��त*ल+प अ,े+षत/Copy to: 1. Appellant 2. Respondent 3. आयकर आयु-त (अपील)/CIT(A) 4. आयकर आयु-त/CIT 5. +वभागीय ��त�न1ध/DR 6. गाड� फाईल/GF.