R ROSALIN VASANTHI,SALEM vs. ITO, SALEM

Per contra, the Ld DR submitted that the Ld CIT(A) obtained a remand

report from the AO , furnished a copy to the assessee and after

considering their reply etc , upheld the orders of the AO and hence he

supported the orders of the lower authorities.

material. The impugned property was an ancestral property of Shri. S.A.

Thomas Caminus through a registered will during 1979. On 29.01.1995,

Mr. Thomas Caminus executed a will in favour of his three brothers. The

property consisted of land measuring 9234 sq.ft. and a building thereon

which was received by the assessee (Mrs. A. Sundaramma), her daughter

(Mrs. R. Rosalin Vasanthi) and assessee’s son having 30% share in 1/3th

share of land and building at Pollachi through a will dated 14.07.2001

executed by her husband Shri. A. Royappan. This property was sold on

13.10.2004 for Rs. 1,05,00,000/- and hence the respective assessees’

admitted their share as capital gains. While computing the capital gains,

the assessees’ have adopted Rs. 231.50 per sq.ft. as the value of the

property as on 01.04.1981 and worked out the indexed cost of

acquisition. When the AO proposed to assessee the value of the land

adopting the value shown by the registration authority and adopt the

:-5-: ITA Nos. 3212 & 3242/Chny/2018

value of the super structure as per the valuation officer’s report, the

assessee submitted that the impugned property was given on rent for Rs.

4,000/- per month with a rental advance of Rs. 2,00,000/- and therefore,

it is proper to adopt the value on rent capitalisation method as per the

provisions of the Wealth Tax Act. However, the AO did not agree with

assessees’ plea and proceeded to compute the capital gains based on the

value shown by the stamp authorities and the valuation officer. Before

us, the assessee pleads that the guideline value does not reflect the

market value and by the time the valuation officer went for inspection,

the property was already demolished and hence the valuation made by

him cannot be considered as a scientific one. On these facts and

circumstances of the case, wefind merit in the submissions of the

assessee. The existence of rental agreement, the receipt of rent and

rental advance is not disputed. Therefore, we are of the view that the

value of the land and building should be determined on the basis of rent

capitalisation method. The assessee has quantified the value at Rs.

8,28,750/-, which may be rounded off to Rs. 10 lakhs. Therefore, we

direct the AO to adopt Rs. 10 lakhs towards the cost of acquisition for the

land and building as on 01.04.1981 and proceed to determine the cost of

indexation accordingly, for the determination of capital gains in the

respective assessee’s hand. Corresponding grounds of the above

assessee’s are allowed to the above extent.

:-6-: ITA Nos. 3212 & 3242/Chny/2018

allowed.

Order pronounced on Thursday, 05th March, 2020 at Chennai.

Sd/- Sd/- (एसजयरामन) (जॉज�माथन) (GEORGE MATHAN) (S. JAYARAMAN) लेखासद!य/Accountant Member या�यकसद!य/Judicial Member

चे�नई/Chennai, 1दनांक/Dated: 05th March, 2020 JPV आदेशक)&�त3ल4पअ5े4षत/Copy to: 1. अपीलाथ(/Appellant 2. &'यथ(/Respondent 3. आयकरआयु6त ) अपील(/CIT(A) 4. आयकरआयु6त/CIT 5. 4वभागीय&�त�न�ध/DR 6. गाड�फाईल/GF