DEEPALI BHARGAVA,JAIPUR vs. ITO, JAIPUR

आयकर अपीलीय अधिकरण] जयपुर न्यायपीठ] जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES (SMC), JAIPUR Jh HkkxpUn] ys[kk lnL; ds le{k BEFORE: SHRI BHAGCHAND, ACCOUNTANT MEMBER vk;dj vihy la-@ITA No. 158/JP/2016 fu/kZkj.k o"kZ@Assessment Year : 2008-09 cuke Mrs. Deepali Bhargava The ITO Vs. 70, Taru Chaya Nagar,Jaipur Ward- 2(5), Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: ABAPB 0153 E vihykFkhZ@Appellant izR;FkhZ@Respondent vk;dj vihy la-@ITA No. 157/JP/2016 fu/kZkj.k o"kZ@Assessment Year : 2008-09 cuke Shri Harish Bhargava The ITO Vs. 20/46, Ranu Path, Jaipur Ward- 2(5),Jaipur LFkk;h ys[kk la-@thvkbZvkj la-@PAN/GIR No.: AFAPB 3507 J vihykFkhZ@Appellant izR;FkhZ@Respondent fu/kZkfjrh dh vksj ls@Assessee by: Shri Siddharth Ranka & Shri Saurav Harsh , Advocate jktLo dh vksj ls@ Revenue by :Smt. Poonam Rai, DCIT - DR lquokbZ dh rkjh[k@ Date of Hearing : 27/04/2017 ?kks"k.kk dh rkjh[k@ Date of Pronouncement : 30 /05/2017 vkns'k@ ORDER PER BHAGCHAND, AM Both these appeals have been filed by the respective assessee’s against separate orders of the ld. CIT(A)-I, Jaipur dated 04-01-2016 for

2 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . the assessment year 2008-09. The grounds raised by the respective

assessee's are as under:-

Smt. Deepali Bhargava, ITA No. 158/JP/16

‘’1. That on the facts and in the circumstances of the case, the AO erred in issuing notice u/s 148 of the I.T. Act, 1961 which is issued without any reason to believe and the entire proceedings of reassessment deserves to be quashed. 2. That the ld. lower authorities grossly erred in adopting the value of impugned land sold at Rs. 1,67,52,562/- u/s 50C of the Act as against Rs. 1,56,39,110/- shown and adopted by the assessee. 2.1 That the lower authorities grossly erred in ignoring several reasonable, plausible objections which had material bearing on the impugned case, ignoring the same is unjustified, bad in law, is in utter violation of principles of natural justice and ought to have been considered. Non-consideration and rejection in a summary manner is unjustified, bad in law and the entire addition deserves to be deleted. 2.2 That the District Valuation Officer having stated the objections are not considered, the same having been raised by the Assessing Officer, the Assessing Officer grossly erred in mentioning that the District Valuation Officer has considered the same/ considered by the erstwhile Assessing Officer when he himself (District Valuation Officer) had not considered the same, the non-consideration of objection is unjustified and deserves to have been considered. 3. That the ld. lower authorities grossly erred in computing the indexed cost of acquisition at Rs. 6,89,747/- instead of Rs. 34,48,340/- 3.1 Registered Valuer being an expert having computed / worked out fair market value as on01-04-1981 at the rate of Rs. 200/- per sq. yard the ld. lower authorities grossly erred in holding that a rate of Rs. 40/- per sq. yard is applied as on 01-04-1981. 3.2 The Assessing Officer grossly erred in solely and blindly relying upon the valuation adopted by the erstwhile Assessing Officer without any cogent reasons, the non-consideration is unjustified and deserves to be considered.’’

3 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . Shri Harish Bhargava, ITA No. 157/JP/2016

‘’1. That on the facts and in the circumstances of the case, the AO erred in issuing notice u/s 148 of the I.T. Act, 1961 which is issued without any reason to believe and the entire proceedings of reassessment deserves to be quashed.

1.1 That on the facts and in the circumstances of the case, the AO grossly erred in not passing a speaking order to the legal objections raised before him for initiating the reassessment proceedings.

2.1 That the lower authorities grossly erred in ignoring several reasonable, plausible objections which had material bearing on the impugned case, ignoring the same is unjustified, bad in law, is in utter violation of principles of natural justice and ought to have been considered. Non-consideration and rejection in a summary manner is unjustified, bad in law and the entire addition deserves to be deleted.

2.2 That the District Valuation Officer having stated the objections are not considered, the same having been raised by the Assessing Officer, the Assessing Officer grossly erred in mentioning that the District Valuation Officer has considered the same/ considered by the erstwhile Assessing Officer when he himself (District Valuation Officer) had not considered the same, the non-consideration of objection is unjustified and deserves to have been considered.

3.1 Registered Valuer being an expert having computed / worked out fair market value as on01-04-1981 at the rate of Rs. 200/- per sq. yard the ld. lower authorities grossly erred in holding that a rate of Rs. 40/- per sq. yard is applied as on 01-04-1981.

3.2 The Assessing Officer grossly erred in solely and blindly relying upon the valuation adopted by the erstwhile Assessing Officer without any cogent reasons, the non-consideration is unjustified and deserves to be considered.’’

4 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . 2.1 First of all, the appeal of the assessee Smt. Deepali Bhargava in

ITA No. 158/JP/2016 for the assessment year 2008-09 is taken up for

adjudication.

3.1 Apropos Ground No. 1 of the assessee, brief facts of the case are

that the return of income declaring total income of Rs. 2,19,400/- was

furnished on 30-07-2008 by the assessee which was processed u/s 143(1)

of the Act at declared income in her return. The AO observed that during

the year the assessee had entered into a sale transaction of land and had

earned capital gain on sale of property from Gram Naya Nagar, Tatgarh

Road, Beawar. Perusal of order made by the then AO, it was observed by

the AO that same had not been disclosed by the assessee. Accordingly,

notice u/s 148 was issued after recording the reason with the prior

approval of the ld. CIT -1, Jaipur which was conveyed by the Addl. CIT,

Range-2, Jaipur vide his letter No. 1981 dated 6-01-2014. In compliance

of it Shri N.K. Baid Advocate and A.R. of the assessee filed reply stating

that original return filed on 30-07-2008 may be treated as return filed in

compliance of notice u/s 148 of the Act. The copy of reasons was

provided to the assessee on 29-01-2014 during assessment proceedings.

It is noted that no objections were raised before the AO for reopening of

assessment u/s 147 of the Act and the assessee participated in the

5 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . assessment proceedings. The assessment was completed by the AO u/s

143(3) / 148 of the Act on 19-02-2015 determining total income of Rs.

26,36,660/-

3.2 In first appeal, the ld. CIT(A), the ld. CIT(A) has confirmed the

action of the AO by observing at para (vii) to (ix) of his order as under:-

‘’(vii) During the appellate proceedings, it was the contention of the appellant that the proceedings u/s 147 were initiated without prior sanction. It is noted from the assessment order that notice u/s 148 was issued with the prior approval of ld. CIT-1, Jaipur conveyed by the Addl. CIT, Range-2, Jaipur vide his office letter No.1981 dated 6-01-2014. In view of these facts, it cannot be said that proceedings u/s 147 of the Act were initiated without proper sanction and hence, this contention has no weight and deserves to be rejected. (viii) It may be mentioned that in the case of Raymond Woollen Mills Ltd. vs. ITO (1999), 236 ITR 34 (SC), it was held by their lordship that:-

‘’In this case, we do not have to give a final decision as to whether there is suppression of material facts by the assessee or not. We have only to see whether there was prima facie some material on the basis of which the Department could reopen the case. The sufficiency or correctness of the material is not a thing to be considered at this stage. We are of the view that Court cannot strike down the reopening of the case in the facts of this case. It will be open to the assessee to prove that the assumption of facts made in the notice was erroneous. The assessee may also prove that no new facts came to the knowledge of the Income-tax Officer after completion of the assessment proceedings. We are not expressing any opinion on the merits of the case. The question of facts and law are left open to be investigated and decided by the assessing authority. The appellant will be entitled to take all the points before the assessing authority. The appeals are dismissed.’’ (ix) Therefore, in view of the above discussion and looking into totality of facts and circumstances of the case, it is held that AO was justified in reopening the case of the appellant u/s 147 of the Act

6 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . as a substantial income had escaped assessment within the provision of Section 147 of the Act. Hence, this ground of appeal is hereby rejected.’’

3.3 I have heard the rival contentions and perused the materials

available on record. The ld. AR of the assessee filed the written

submission on the issue in question but it is noted that the ld. AR of the

assessee at the time of hearing of the case could not controvert the

observations of the ld. CIT(A) on the issue in question. The ld. CIT(A)

has rightly held that the AO was justified in reopening the case of the

assessee u/s 147 of the Act as substantial income had escaped assessment

within the provision of Section 147. In this view of the matter, the

Ground No. 1 of the assessee is dismissed.

4.1 Apropos Ground No. 2, 2.1 and 2.2 of the assessee, the facts as

emerges from the order of the ld. CIT(A) is as under:-

3.2.2. Determination:

(i) I have carefully perused the submission of the appellant, assessment order and the material placed on record. The appellant along with his five other family members jointly sold a commercial land at Naya Nagar, Tatgarh Road, Beawar, Ajmer admeasuring 18777.21 sq. yards on 31.03.2008 for a consideration of Rs. 9,38,34,660/- and paid stamp duty on Rs. 11,82,96,432/- as per the appellant, his 1/6th share of the sale consideration was to the tune of Rs. 1,56,39,110/- only. However for the purpose of stamp duty, his share worked out to Rs. 1,97,16,072/- (ii) It may be mentioned that during the course of assessment proceedings, in the case of Ms. Roopali Dhingra, another

7 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . co-owner of the property, as the share of Ms. Roopali Dhingra for purpose of stamp duty valuation was higher than the sale consideration as stated in sale deed, in view of the provisions of section 50C of the Act, the matter was referred to the DVO by her AO for determining the FMV as on 31.03.2008. Vide his valuation report dated 28.12.2010, the DVO determined the FMV of the property under consideration as on 31.03.2008 at Rs. 10,05,15,372/- (1/6, Share Rs. 1,67,52,562/-) (iii) The AO, thus, has taken the 1/6th share of the appellant in the said property at Rs. 1,67,52,562/- and computed the LTCG thereof. In this ground, the appellant has challenged the valuation made by the DVO and action of the AO on the basis of the valuation report of the DVO. During appellate proceedings, it was submitted by the appellant that the AO has blindly applied the rates adopted in the case of Ms. Roopali Dhingra. There were several important in the case of Ms. Roopali Dhingra. There were several important factors which the DVO & AO has not considered / not given any benefit while working out the valuation at Rs. 1,67,50,562/- which are as under :- • The valuation done by the sub Registrar is @ Rs. 700/- per square feet whereas it is to be noted that no specific valuation has been prescribed by the Sub-Registrar towards the land belonging to the appellant. On perusal of the chart of DLC rate, it is to be noted that the rate is Rs. 700/- per feet on Tatgarh Marg only upto Parsvanath Hospital. The land belonging to the appellant is situated at least 500 metes futher away from Parsvanath Hospital and no benefit on this account has been give by the DVO. • On Perusal of the DLC rate Chart, It may be noted that no rate has been prescribed of land value is case the land is situated away from the main road in case of (Up Kshetra A) Whereas n case of up Kshetra B & C the value adopted is half of the main road rate in case the land is away from the main road. Benefit of such depth from the main highway while calculating the valuation report ought to have been given but has not been given. • At the time of physical inspection of the impugned land the DVO had noticed that the land is irregular and it is neither straight nor square nor rectangular, it has several turns after every 50 feet and is also situated in law lying area and at least 5 feet below from the main road and in comparison to other nearby lands. Thus at the time of selling the buyer would have discounted the irregular shape of land and would have adjusted the rate of filling up such huge and area. The id. Valuation

8 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . officer has just given a benefit of 5% on this count which should have been at least 10% • No comparative sale instance has been given by the DVO in its favour of adjoining land areas. • The land was owned by six co-owners and unless all agreed to sell it could not have been sold. The ID. Distriict valuation officers has allowed only 10% adjustment when it should have been at least 20% • The land was huge and none was willing to purchase such a vast land particularly in a small place like Beawar whose population is just about 1 lac & therefore for largeness of plot / size an additional rebate of 10% deserves to be allowed.

(iv) Thus, in a nutshell, it was the submission of the appellant that at least 40% rebate should be allowed by the DVO looking to the various factors as mentioned above. I have gone through the valuation report prepared by the DVO and It is noted that in the absence of reliable contemporary sale instances, circle area rates with adjustment factor have been adopted by the DVO. The DVO made the inspection of the site and after making necessary adjustment on account of land being a joint property of six owners, land being low lying and irregular / zigzag in shape, the DVO provided a total rebate of 15% to the circle rates of the area under consideration. It is noted from the chart of DLC rates that the DLC rates are @ Rs. 700/- per feet for commercial lands near the road. It is noted from the site map (PB- 70) that the land under consideration is on the main road i.e. on Beawar Tatgarh Road, having a frontage of 316 feet and is surrounded by residential colonies and there is vacant land of 60 feet (PB-85) between the BT road and the land under consideration. Therefore, the DLC rate of Rs. 700/- per sq. feet is clearly applicable to the land under consideration. The DVO has already adjusted DLC rates by giving rebate of 15% while determining the FMV. (v) During the appellate proceedings, the AR has drawn my attention to column NO. 10 of the valuation report of the DVO wherein reference to letter dated 27.12.2010 of Ms. Roopali Dhingra, It has been stated by the DVO as assessee's request not considered. I have gone through the said letter dated 27.12.2010 (PB-83-84) and observed that the emphasis thereon was that value has to be seen as on 29.03.2007 and not as on 31.03.2008 as the Agreement to Sell was entered into on 29.03.2007 and at that point of the time the land was residential in nature in revenue record. Further the DLC rate at the time

9 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . of entry into Agreement to sell was Rs. 220/- per feet. A sum of Rs. 1,41,96,737/- was incurred towards land use conversion and land was converted for commercial use on 02.02.2008. It may be mentioned that these issues are not to be examined by the DVO as reference was made to the DVO for determining the FMV as on 31.03.2008. Further, the appellant has not provided a copy of the Agreement to sell dated 29.03.2007 and did not demonstrate how the date of sale could be taken as 29.03.2007 when the document for transferring the little of the property under consideration was registered on 31.03.2008 itself. Therefore, this contention is rejected. (vi) In view of the above discussion, it is held that the DVO has not followed the circle rates blindly but he has applied his mind, made the spot inspection of the property, considered the factors which may adversely affect the FMV and determined the FMV of the property under consideration of Rs. 10,05,15,372/- Therefore, I do not find any infirmity in the valuation report of the DVO. Hence this ground of appeal is rejected. (vii) It is pertinent to mention here that regarding the FMV of the property under consideration as on 01.04.1981, as dealt in ground of appeal no. 3 the appellant has taken the value at Rs. 200/- per Sq. Yard on the basis of the valuation report of the Registered valuer by treating the property under consideration as a commercial property. It is observed from the valuation report of Registered valuer dated 07.07.2008 that no rebate was allowed by the Registered valuer on account large size, irregular shape and join ownership of the property etc. Whereas the appellant is claiming rebate the least @ 40% by the DVO for determining FMV as on the date of sale of the property under consideration. The appellant cannot be allowed to adopt different yard sticks for valuation of the same property as on 01.04.1981 and on the date of its sale i.e. 31.03.2008 i.e. it should also consider rebate of 40% while determining FMV of the property as on 01.04.1981. ‘’

4.2 During the course of hearing, the ld. AR of the assessee challenged

the order of the ld. CIT(A) on the issue in question and filed the written

submission as under:-

‘’2. During the year under consideration the assessee appellant and other 5 co-owners had sold a piece of land situated at Beawar, District Ajmer for total consideration of Rs. 93,834,660/-, assessee’s share

10 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . came to Rs. 15,639,110/-. The sub-registrar adopted the total value at Rs. 118,296,423/- as per which each co-owner’s share came to Rs. 19,716,072/-. Copy of sale deed dated 31.03.2008 is at PB 16-27.

2.1 Return of Income of another co-owner Smt. Roopali Dhingra was also selected for scrutiny assessment, during which, the matter was referred to DVO who applied the value of sale consideration at Rs. 16,752,562/-. Copy of DVO report dated 28.12.2010 is enclosed herewith at PB 61-66. THE DIFFERENCE BETWEEN THE VALUE OF CONSIDERATION AS PER ASSESSEE AND AS PER DVO IS MERELY 7.12%.

2.2 That on the basis of rates adopted in the case of Smt. Roopali Dhingra the proceedings in the case of the assessee appellant were also re-opened. That in the reasons recorded there is no mention with regards to the fact that even the Department Valuation Officer has rejected the sale consideration as adopted by the Sub-Registrar however it has been mentioned that assessee appellant did not disclose the valuation as per Sub-Registrar. There is no requirement in law to accept the valuation as per Sub-Registrar when the assessee doesn’t accept the same.

2.3 That your honour shall notice that the ld. Assessing Officer has blindly applied the rates adopted in the case of Smt. Roopali Dhingra. That there were several important factors which the ld. DVO & the ld. Assessing Officer has not considered / not given any benefit while working out the valuation at Rs. 16,752,562/- which are as under:

Objection No. Remarks Relief by DVO

01 The valuation done by the Sub-Registrar NIL is @ Rs. 700/- per square feet whereas it is to be noted that no specific valuation has been prescribed by the Sub-Registrar towards the land belonging to the Assessee appellant PB 67. On perusal of the chart of DLC rate; as obtained from the office of Sub-Registrar your honour shall notice that the rate is Rs. 700/- per feet on Tatgarh Marg only upto Parsvanath Hospital. The land belonging to the Assessee appellant is situated at

11 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . least 500 meters further away from Parsvanath Hospital PB 27. Furthermore no benefit on this account has been given by the ld. Valuation Officer. PB 69.

On perusal of the DLC rate chart PB 67 02 NIL your honour will further notice that no rate has been prescribed of land value in case the land is situated away from the main road in case of (Up Kshetra A). Whereas in case of Up Kshetra B & C the value adopted is half of the main road rate in case the land is away from the main road. Benefit of such depth from the main highway while calculating the valuation report ought to have been given but has not been given PB 69.

5% 03 At the time of physical inspection of the impugned land the ld. Valuation Officer had noticed that the land is irregular and it is neither straight nor square nor rectangular, it has several turns after every 50 feet and is also situated in low lying area and at-least 5 feet below from the main road and in comparison to other nearby lands. Thus at the time of selling the buyer would have discounted the irregular shape of land and would have adjusted the rate of filling up such huge land area PB 70, 75.

04 No comparative sale instance has been NIL given by the ld. Departmental Valuation Officer in its favour of adjoining land areas PB 71.

05 The land was owned by six co-owners 10% and unless all agreed to sell it could not have been sold PB 77.

12 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . 06 The land was huge and none was willing to purchase such a vast land particularly in a small place like Beawar whose population is just about 1 lac & therefore for largeness of plot / size an additional rebate deserves to be allowed PB 78.

2.4 Copy of objections filed with the DVO & AO (in the case of Smt. Roopali Dhingra) by letter dated 23.12.2010 (PB 68-71), 27.12.2010 (PB 72-74), 27.12.2010 (PB 75) & 29.12.2010 (PB 76-78) is enclosed herewith.

2.5 That the additions made by the ld. Assessing Officer in the case of Smt. Roopali Dhingra were challenged in First Appeal and the ld. CIT (A), Bikaner (Camp at Jaipur) vide order in appeal number 684/BKN/2010-2011 dated 31.03.2015 who has in a very detailed order after referring to various authorities has deleted the entire addition PB 39-60.

2.6 We also wish to refer to the following authorities in this regards:

Hon’ble Rajasthan High Court in CIT v. Rameshwar (a) Prasad Kacholia (DBITA 51/2014 dated 15.10.2015) PB 79- 86 wherein the Hon’ble Rajasthan High Court has approved the discount given by the ld. CIT (A) and the Hon’ble ITAT and disregarded the valuation u/s. 50C owing to adverse factors of Land.

(b) In ITO v. Ms. Kumudini Venugopal [2011] 16 taxmann.com 136 (Chennai ITAT) PB 87-91 it was held:

Section 50C of the Income-tax Act, 1961 - Capital gains - Special provision for full value of consideration in certain cases - Assessment year 2005-06 - Assessee had sold certain agricultural land - In course of assessment, provision of section 50C were applied to assessee's case and valuation of property as per guideline value of stamp valuation authority was accepted because same was found to be higher than sale consideration disclosed by assessee - Assessee invoked provisions of section 50C(2) and claimed that value as fixed by

13 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . stamp valuation authority was on higher side - Assessing Officer thus referred valuation of property to DVO - DVO valued property at a figure much lower than value as fixed by stamp valuation authority - Whether on facts, claim of assessee was true and correct and, therefore, Assessing Officer was to be directed to accept sale consideration as admitted by assessee in her return of income - Held, yes. © In Ravi Kant v. ITO [2007] 110 TTJ 297 (Delhi ITAT) PB 92-95 it was held: On a perusal of valuation report, however, we find that even the valuation by the DVO has placed too much of emphasis on the assessment or valuation by the stamp valuation authority. This is neither desirable nor permissible. The reason is this. The valuation by the stamp valuation authority is based on the circle rates. These circle rates adopt uniform rate of land for an entire locality, which inherently disregards peculiar features of a particular property. Even in a particular area, on account of location factors and possibilities of commercial use, there can be wide variations in the prices of land. However, circle rates disregard all these factors and adopt a uniform rate for all properties in that particular area. If the circle rate fixed by the stamp valuation authorities was to be adopted in all situations, there was no need of reference to the DVO under Section 50C(2). The sweeping generalizations inherent in the circle rates cannot hold good in all situations. It is, therefore, not uncommon that while fixing the circle rates, authorities do err on the side of excessive caution by adopting higher rates of the land in a particular area as the circle rate. In such circumstances, the DVO's blind reliance on circle rates is unjustified. The DVO has simply adopted the average circle rate of residential and commercial area, on the ground that interior area of the locality, where the assessee's property is situated, is mixed developed area i.e. shops and offices on the ground floor and residence on the upper floors. When DVO's valuation required to compare the same with the valuation by the stamp valuation authority, it is futile to base such a report on the circle report itself. Such an approach will render exercise under Section 50C(2) a meaningless ritual and an empty formality. In our considered view, in such a case, the DVO's report should be based on consideration stated in the registration documents for comparable transactions, as also factors such as inputs from other sources about the market rates. For the reasons set out above, and with these

14 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . observations, we remit the matter to the file of the AO. The DVO will value the property de novo, in the light of our above observations, and in case the valuation so arrived at by the DVO is less than Rs. 11,42,100, the AO shall adopt the fresh valuation so done by the DVO for the purpose of computing capital gains under Section 48 of the Act. We direct so.

(d) In Suresh C. Mehta vs. ITO [(2013) 35 taxmann.com 230 (Mumbai ITAT) PB 96-100 it was held:

Valuation report of DVO is not binding upon CIT (A) and he is bound to look into the objections of the assessee.

(e) In ACIT vs. MIL Industries Ltd. [(2013) 33 taxmann.com 120 (Chennai ITAT) PB 101-106 the report of the DVO was ignored.

(f) In Chandra Bhan Agarwal vs. Addl. CIT [(2012) 21 taxmann.com 133 (Calcutta ITAT) PB 107-116 wherein the report of the DVO was ignored since objections of the assessee were not properly disposed and accordingly consideration given by the Assessee was accepted.

(g) In Jai Kumar Chawla v. ITO [(2013) 39 taxmann.com 188 (Indore ITAT) PB 117-123 it was held:

Valuation in case of land should be arrived at by taking into account adverse factors attached to land. Keeping into account all these factors, which are going to adversely affect fair market value of land, we direct the Assessing Officer to reduce the valuation arrived at by the DVO by 20 %. Accordingly, the Assessing Officer is to recompute the gain after reducing the valuation arrived at by the DVO by 20 % or the actual sale consideration received by assessee, whichever is higher.

(h) In Reshma R. Daryanani v. ITO [(2015) 57 taxmann.com 414 (Mumbai ITAT) PB 124-126 it was held:

15 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . Where AO had not examined whether assessee could have sold her plot at a price which was stipulated by stamp duty authorities and assessee had given a detailed clarification about low price, addition made on basis of stamp duty valuation was to be deleted.

(i) In Sita Bai Khetan v. ITO [ITA 826/JP/2013 dated 27.07.2016 (Jaipur ITAT) PB 202-209 it was held:

In the instant case, the difference between the valuation adopted by the Stamp Valuation Authority and declared by the assessee is less than 10%. Therefore, respectfully following the decision of the Hon’ble Coordinate Bench, we hereby direct the AO to adopt the value as declared by the assessee. This ground of the assessee is allowed.

(j) In ACIT v. S. Suvarna Rekha [ITA 743/Hyd/2009 dated 29.10.2010 (Hyderabad ITAT) PB 210-216 it was held:

The total consideration received by the assessee is Rs.70 lakhs. On a reference to the valuation officer, the valuation officer estimated the value of the property at Rs.75,76,712. Admittedly the difference between the value estimated by the valuation officer and the sale consideration shown by the assessee is less than 10%. An identical situation was considered by the Pune Bench of this Tribunal in Rahul Construction (supra). After considering the various case-laws the Pune Bench of this Tribunal found that the difference of 10% in valuation is always bound to occur. Therefore, when the difference between the value shown by the assessee and the estimated value is less than 10%, the value shown by the assessee shall be adopted for the purpose of computation of capital gain. In this case also the difference is less than 10% between the value shown by the assessee and the value estimated by the valuation officer. When the value of the property was estimated there will be a difference of 10% ± depending upon the individual valuation officers. No one is expected to value the property accurately since some of the items are to be valued on guesswork or notionally. Therefore, as observed by the Pune Bench of this Tribunal, the difference of less than 10% has to be ignored. In view of the decision of the Pune Bench of this Tribunal in the case of Rahul Construction (supra), in our opinion, the CIT(A) has rightly

16 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . deleted the addition made by the Assessing Officer. Therefore, we do not find any infirmity in the order of the lower authority. Accordingly the same is confirmed.

4.3 During the course of hearing, the ld. DR relied on the orders of the

authorities below. 4.4 I have heard the rival contentions and perused the materials

available on record. It is noted from the records that the assessee

alongwith five other members jointly sold a commercial land at Naya

Nagar, Titgarh Road, Beawar, Ajmer admeasuring 18777.21 Sq. Yards on

31-03-2008 for a consideration of Rs. 9,38,34,660/- and paid a stamp duty on Rs. 11,82,96,432/-. It is observed that as per assessee her 1/6th share of

sale consideration was to the tune of Rs. 1,56,39,110/- only and for the

purpose of stamp duty, the share of the assessee is worked out to Rs.

1,97,1,072/-. It is also noted that the AO during the course of assessment

proceedings in the case of the assessee had taken into consideration the

case of Shri Ms. Roopali Dhingra, another co-owner of the property and

noted that as the share of Ms. Roopali Dhingra for the purpose of stamp

duty valuation was higher than the sale consideration as stated in the sale

deed, in view of the provisions of Section 50C of the Act. It is also noted

that the matter was referred to the DVO by her AO for determining the

FMV as on 31-03-2008. The DVO vide his valuation report dated 28-12-

17 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . 2010 determined the FMV of the property under consideration as on 31- 03-2008 at Rs. 10,05,15,372/- i.e. 1/6th share of the assessee at Rs.

1,67,52,562/- and the AO thus computed the Long term capital gain

thereof. The assessee challenged the issue before the ld. CIT(A) as to the

valuation made by the DVO and the action of the AO on the basis of the

valuation report of the DVO. However, the assessee carried the matter

before the ld. CIT(A) who has confirmed the action of the AO by

observing as under.

‘’(vi) In view of the above discussion, it is held that the DVO has not followed the circle rates blindly but he has applied his mind, made the spot inspection of the property, considered the factors which may adversely affect the FMV and determined the FMV of the property under consideration of Rs. 10,05,15,372/- Therefore, I do not find any infirmity in the valuation report of the DVO. Hence this ground of appeal is rejected. (vii) It is pertinent to mention here that regarding the FMV of the property under consideration as on 01.04.1981, as dealt in ground of appeal no. 3 the appellant has taken the value at Rs. 200/- per Sq. Yard on the basis of the valuation report of the Registered valuer by treating the property under consideration as a commercial property. It is observed from the valuation report of Registered valuer dated 07.07.2008 that no rebate was allowed by the Registered valuer on account large size, irregular shape and join ownership of the property etc. Whereas the appellant is claiming rebate the least @ 40% by the DVO for determining FMV as on the date of sale of the property under consideration. The appellant cannot be allowed to adopt different yard sticks for valuation of the same property as on 01.04.1981 and on the date of its sale i.e. 31.03.2008 i.e. it should also consider rebate of 40% while determining FMV of the property as on 01.04.1981. ‘’ It is noted from the records that the Sub-Registrar had made valuation of

the property at Tatgarh Road, i.e. upto Parsavnatrh Hospital, Beawar at

18 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . Rs. 700/- per sq. ft (Assessee's Paper Book page 67). However, it is

noted that the land of the assessee is situated further 500 meters away

from Parsavnath Hospital (Assessee's Paper book page 27). On perusal of

the DLC rate chart (PB 67) it is noted that no rate has been prescribed of

and value in case of land which is situated away from the main road in

case of Up Kshetra. It is also noted that at the time of physical inspection

of impugned land the DVO observed that the land was neither straight nor

square nor rectangular which had several turns after every 50 sq.ft. It is

also noted that no comparative sale instance had been given by the DVO

as to adjoining land of the assessee. It is noteworthy to mention that there

are six co-owners of the land and the land in question cannot be sold

without their consents. It is also noted that the AO had taken the case of

Ms. Roopali Dhingra, another co-owner of the property with the case of

the assessee which case was decided by the ld. CIT(A), Bikaner (camp at

Jaipur) vide appeal no. 684/Bikaner/2010-2011 dated 31-03-2015 in

favour of Ms. Roopali Dhingra deleting the additions made by the lower

authorities (APB page 39 to 60). It is thus observed that although the

lower authorities have taken the recourse of Ms. Roopali Dhingra case

with the assessee during the assessment order and made the additions yet

19 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . the case of Ms. Roopali Dhingra has been decided by the ld. CIT(A),

Bikaner (camp at Jaipur), supra deleting the additions. Therefore, the

question does not arise to make addition in the case of assessee. However,

it is observed that similar type of issue has been dealt with by the ITAT

Hyderabad Bench in the case of ACIT vs. Smt. S. Suvarna Rekha in ITA

No. 743/HYd/2009 for the assessment year 2006-07 vide its order dated 29th Oct. 2010 and the observation of the Bench is as under:-

‘’9. Let us new examine section 50C of the Act. Section 50C empowers the Assessing officer to take the guidelines value as full value of consideration in case the sale consideration is less that the value adopted by the concerned authorities for the purpose of valuation of stamp duty. However, when the assessee claims that the value adopted by the stamp duty valuation authority exceeds the fair market value the Assessing Officer may refer the matter to the valuation officer to estimate the value of the capital asset. After reference to valuation officer, if the value estimated by the valuation officer exceeds the value adopted by the Stamp duty valuation authority then the Assessing Officer shall take the valuation of the stamp duty valuation authority as full value of consideration for the purpose of computing capital gain. In the case before us as on 19.08.2005 the guidelines value for the property is Rs. 12,000per SY. However, the sale consideration show in the sale deed is only Rs. 7000 per SY. The total consideration received by the assessee is Rs. 70 lakhs. On a reference to the valuation officer, the valuation officer estimated the value of the property at Rs. 75,67,712. Admittedly the difference between the value estimated by the valuation officer and the sale consideration shown by the assessee is less than 10%. An identical situation was considered by the Pune Bench of this Tribunal in Rahul Construction (supra). After considering the various case-laws the Pune Bench of this Tribunal found that the difference of 10% in valuation is always bound to occur. Therefore, when the difference between the value shown by the assessee and the estimated value is less than 10% the value shown by the assessee shall be adopted for the purpose of computation of capital gain. In this case also the difference is less than 10% between the value shown by the assessee and the value estimated by the valuation Officer. When the value of the property was estimated

20 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . there will be a difference of 10% + depending upon the individual valuation Officer. No one is excepted to value the property accurately since some of the items are to be value on guesswork or notionally. Therefore, as observed by the Pune Bench of this Tribunal, the difference of less than 10% has to be ignored. In view of the decision of the Pune Bench of this Tribunal in the case of Rahul Construction (supra), in our opinion, the CIT(A) has rightly deleted the addition made by the Assessing Officer. Therefore, we do not find any infirmity in the order of the lower authority. Accordingly the same is confirmed. ‘’ In this view of the matter and also taking into consideration the decision

of ITAT , Hyderabad Bench in the case of ACIT vs. Smt. S. Suvarna

Rekha (supra), we find that the ld. CIT(A) is not justified in adopting the

value of the impugned land at Rs. 1,67,52,562/- instead of Rs.

1,56,39,110/- u/s 50C of the Act. Thus Ground No. 2 to 2.2 of the

assessee are allowed.

5.1 Apropos Ground No. 3, 3.1 and 3.2 of the assessee, the facts as

emerges from the order of the ld. CIT(A) is as under:-

3.3.2 Determination:

(i) I have carefully perused the submissions of the appellant and the material placed on record. It is noted that the appellant has taken the cost of acquisition (FMV) as on date: 01.04.1981 at Rs. 200/-per sq. yard whereas the AO applied the rate of Rs.40/-per sq. yard. During the appellate proceedings, it was the contention of the appellant that it had taken FMV as date 01.04.1984 @Rs.200/-per Sq. yard on the basis of the valuation report of the Registered valuer who is a technical person. The AO adopted the rate of Rs. 40/-per sq. yard on the basis of assumption, presumption, conjectures and surmises and thus not justified in taking rate of Rs.40/- per sq. yard. The AO has blindly applied the rates adopted in the case of Ms. Roopali Dhingra.

21 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . (ii) I have examined the valuation report of the Registered valuer dated 07.07.2008 wherein he had determined the cost of land as on dated 01.04.1981 at Rs. 37,55,000/-. It is pertinent to reproduce here the relevant extract of the valuation report (P3-123) as under: "Total land area in 1981-19,942.21 sq yds.

Total land area available after conversion as on 02.02.2008-18,777,21 sq.yds. Land use of the land area in 1981 was residential and as at that time there were no DLC rate system the rates of the area can be based on assumption only. These have been based on the earliest available land rats for the area and than assuming the backwards rates of the year 1981. As in the nearby area residential use rates were in the range of Rs. 80/-sq.yds. to Rs. 100/-sq. Yds. the rates adopted for Naya Nagar area are Rs. 65/-Sq.Yds. Rates for commercial use are 3 times of rates for residential use. Hence the rates for the area are taken as Rs. 200/- Sq. Yds." (iii) Thus, it is evident from the report Registered valuer that he has taken the rate fro determining the FMV of the Property' by contradiction himself: - As in column No.8(is the property situated in residential/ commercial/mixed area/industrial area)(PB-114), the Registered Valuer stated as " residential area in 1981; converted to commercial on 02.02.2008" In column no. 16(Is there any restrictive covenant, in regard to use of land) and it was stated by the registered Valuer as "for construction of residence" (iv) Therefore, in view of the above facts and inherent contradictions in the valuation report of the Registered Valuer, it is held that the Registered Valuer was not justified in taking land cost (FMV) as on 01.04.1981 at Rs. 200/- per sq. yard and his valuation report con not be relied upon. Now the question comes what should be the FMV as on 01.04.1981 or cost of acquisition. As already stated above, the Registered Valuer has taken the rates for Naya Nagar area at Rs. 65/-per sq. yard for residential property whereas the AO has taken the value at Rs.40/-per sq. Yard. thus, the FMV as on 01.04.1981, can at the most be Rs. 65-per sq. Yard for a residential land as is evident

22 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . from the report the report of Registered Valuer as stated earlier. It is noted from the assessment order that the Registered Valuer stated before the AO of Ms Roopali Bhargava that the earliest sale instance was on undated sale agreement, however, the said stamp paper was issued on 19.01.1990 therefore, the earliest sale instance was taken as available for 19.01.1990. The AO in the instant case under consideration adopted 19.01.1990 as the earliest sale instance available @ Rs. 65/- per sq. yard and made backward calculation on the basis of cost inflation index and determined the value in 1981 at Rs. 36/-per sq. yard. (v) The Ld. CIT(A), Bikaner in the case of Ms Roopali Dhingra observed that since the statement of Registered Valuer was recorded by the AO and no opportunity of cross examination was provided to Ms Roopali Dhingra, therefore, the same cannot be given any cognizance. I do not concur with the findings of Ld. CIT(A), Bikaner in this regard. The Registered Valuer, as apparent from the assessment record only stated that the earliest sale instance available is of 19.01.1990 only. As the Registered Valuer prepared the valuation report on behalf of the co-owners, and they relied upon the valuation report, it is the logical conclusion that they must be aware of the said sale instance and thus the AO has not brought on record anything which was not in the knowledge of the co-owner of the property. The AO calculated backward the FMV as on 01.04.1981 from 19.01.1990 on the basis of cost inflation index, I do not see any error in it as the 'time gap' method or 'reserve indexation' method, has been approved by the Hon'ble ITAT, Jodhpur in the following cases :- Deed Dayal Rathi, Jodhpur vs. ITO 3(4) ITA No. 108/Jodh/2013 AY 2009-10. Dy. CIT circle-2 Udaipur, vs. Shri Rajendra Kumar Singhvi, ITA No. 313/Jodh/2010 AY 2007-08. (vi) It was the contention of the AR in the case of Ms Roopali Dhingra that the AO cannot tinker with the valuation report prepared by Registered Valuer. It may be mentioned here that the AO has not tinkered with the valuation report prepared by the Registered Valuer. He has just applied the valuation for a residential property, instead of commercial one as adopted by the Registered Valuer and applied 'time gap' method to get the FMV as on 01.04.1981. Even otherwise, the CIT(A) has coterminous powers with the AO and CIT(A) is empowered to tinker with the report of the Registered Valuer and it has already been held by me that the valuation report of the Registered Valuer cannot be relied upon because of inherent defects. Therefore, in view of the above discussion, I think it would be proper

23 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . to take the FMV of the property as on 01.04.1981 at Rs. 40/- per Sq. Yard and not Rs. 65/- per Sq. Yard and not RS. 65/- per Sq. Yard for a residential property as taken by the Registered Valuer on the basis of earliest available sale instance of 1990 and without making adjustment for the time gat of nine years. (vii) Therefore, in view of the above discussion, it is held that the AO was justified in taking the FMV of property under consideration @ Rs. 40/- per sq. yard as on 01.04.1981. Hence, this ground of appeal is rejected. (viii) It may be mentioned that during the appellate proceeding, the appellant invited my attention to the decision of the Ld. CIT(A), Bikaner (Camp at Jaipur) dated 31.03.2015 in the case of Ms. Roopali Dhingra for the AY 2008-09 wherein all the addition were deleted and the Ld. CIT(A) restored the valuation as on 01.04.1981 which was adopted on the basis of report of Registered Valuer. It is respectfully stated that I do not concur with the findings of the Ltd. CIT(A), Bikaner in the case of Ms. Roopali Dhingra for the reasons as discussed earlier in this order while confirming the action of the AO.’’ 5.2 During the course of hearing, the ld. AR of the assessee challenged

the order of the ld. CIT(A) on the issue in question and filed the written

submission as under:-

1.1 The ld. Assessing Officer in the case of Smt. Roopali Dhingra applied the rate at Rs. 40/- per square yard and applied the valuation at Rs. 689,747/-

1.2 That on the basis of rates adopted in the case of Smt. Roopali Dhingra the proceedings in the case of the assessee appellant were also re-opened. That the ld. Assessing Officer has blindly applied the rates adopted in the case of Smt. Roopali Dhingra. That there were several important factors which the ld. Assessing Officer has not

24 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . considered while working out the valuation as at 01.04.1981 and legal authorities referred to by the assessee appellant.

1.3 That the additions made in the case of Smt. Roopali Dhingra were challenged in First Appeal and the Hon’ble CIT (A), Bikaner (Camp at Jaipur) vide order in appeal number 684/BKN/2010- 2011 dated 31.03.2015 who has in a very detailed order after referring to various authorities has deleted the entire addition and restored the valuation as at 01.04.1981 which was adopted on the basis of report of Valuation Officer [PB 39-60].

1.4 We also wish to refer to the following authorities in this regards:

In DCIT v. Vinod Mehta [2013] Tax World (a) Vol. 49 page 76 the Hon’ble ITAT after relying upon (CIT v. Duncan Brothers and Co. Ltd. - 209 ITR 44, ITO v. Mahendra Kumar Agarwal – 1251/JP/2008 and Mrs. Gopi S. Shivani v. ITO 133 ITR 172) [PB 140-143] has held: Cost of acquisition – Capital Gains – Property acquired in inheritance – original acquisition was prior to 01.04.1981 – Assessee opted to take the cost of acquisition as on 01.04.1981 – Filed the Regd. Valuer Report – AO did not accept the same – CIT(A) accepted the appeal of assessee. Now Hon’ble ITAT has also held that market value as on 01.04.1981 on the basis of Regd. Valuer’s Report should be considered in these types of cases. (b) Hon’ble Gujarat High Court in ACIT vs. Hiraben Govindbhai Patel [2014] 44 taxmann.com 29 [PB 144-149] has held:

Value adopted by assessee cannot be substituted by A.O. merely on the basis of general inquiries. When the value declared by the assessee as on 01.04.1981 is supported by valuation report of a registered valuer and the A.O. has taken different valuation without obtaining valuation report from the DVO, such value taken by the registered valuer cannot be substituted by the A.O. merely on the basis of general inquiries without obtaining a report from DVO.

25 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur .

© Hon’ble Bombay High Court in CIT v. Puja Prints [(2014) 265 CTR 124 (Bom)] [PB 150-155] has held:

“6. We have considered the rival submissions. We find that the impugned order dated 18 February, 2011 allowing the respondent-assessee's appeal holding that no reference to the Departmental Valuation Officer can be made under Section 55A of the Act, only follows the decision of this Court in the matter of Daulal Mohta HUF (supra). The revenue has not been able to point out how the aforesaid decision is inapplicable to the present facts nor has the revenue pointed out that the decision in Daulal Mohta HUF (supra) has not been accepted by the revenue. On the aforesaid ground alone, this appeal need not be entertained. However, as submissions were made on merits, we have independently examined the same. 7. We find that Section 55A(a) of the Act very clearly at the relevant time provided that a reference could be made to the Departmental Valuation Officer only when the value adopted by the assessee was less than the fair market value. In the present case, it is an undisputed position that the value adopted by the respondent-assessee of the property at Rs.35.99 lakhs was much more than the fair market value of Rs.6.68 lakhs even as determined by the Departmental Valuation Officer. In fact, the Assessing Officer referred the issue of valuation to the Departmental Valuation Officer only because in his view the valuation of the property as on 1981 as made by the respondent- assessee was higher than the fair market value. In the aforesaid circumstances, the invocation of Section 55A(a) of the Act is not justified. 8. The contention of the revenue that in view of the amendment to Section 55A(a) of the Act in 2012 by which the words "is less then the fair market value" is substituted by the words " "is at variance with its fair market value" is clarificatory and should be given retrospective effect. This submission is in face of the fact that the 2012 amendment was made effective only from 1 July 2012. The Parliament has not given retrospective effect to the amendment. Therefore, the law to be applied in the present case is Section 55A(a)

26 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . of the Act as existing during the period relevant to the Assessment Year 2006-07. At the relevant time, very clearly reference could be made to Departmental Valuation Officer only if the value declared by the assessee is in the opinion of Assessing Officer less than its fair market value. 9. The contention of the revenue that the reference to the Departmental Valuation Officer by the Assessing Officer is sustainable in view of Section 55A(a) (ii) of the Act is not acceptable. This is for the reason that Section 55A(b) of the Act very clearly states that it would apply in any other case i.e. a case not covered by Section 55A(a) of the Act. In this case, it is an undisputable position that the issue is covered by Section 55A(a) of the Act. Therefore, resort cannot be had to the residuary clause provided in Section 55A(b)(ii) of the Act. In view of the above, the CBDT Circular dated 25 November 1972 can have no application in the face of the clear position in law. This is so as the understanding of the statutory provisions by the revenue as found in Circular issued by the CBDT is not binding upon the assessee and it is open to an assessee to contend to the contrary.” (d) In Barjinder Singh Bhatti v. ITO [ITA 1101/Chd/2014 (Chandigarh ITAT)] [PB 156-163] it has been held that:

27 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . the capital gains. The orders of the authorities below, thus, cannot be sustained in law. We, accordingly, set aside the orders of authorities below and direct Assessing Officer to accept valuation reported by the assessee as per report of the Registered Valuer as on 01.04.1981 and accept the computation filed by the assessee. (e) Hon’ble Calcutta High Court in CIT v. Mina Deogun [ITA 438/2008 dated 20.04.2015] [PB 164-175] has held that:

In so far as the first question is concerned the property was valued by the registered valuer as at 1st April, 1981 at a sum of Rs.73,60,975/-. Therefore, the share of the assessee worked out to a sum of Rs.18,40,244/-. The assessing officer, however, in exercise of power under section 55A referred the matter to the departmental valuer who valued the property at a sum of Rs.46,62,280/- and thus, the share of the assessee was worked out a sum of Rs.11,65,570/-. The competence of the assessing officer to refer the matter to the departmental valuer under section 55A was under challenge. The learned Tribunal held that the reference made under section 55A was incompetent and, therefore, the valuation provided by the assessee on the basis of the valuation made by the registered valuer valuing the share of the assessee at a sum of Rs.18,40,244/- was accepted, which is under challenge in the first question indicated above. Mr. Agarwal, learned advocate appearing for the revenue/appellant has not disputed the fact that under Clause (a) of section 55A as it stood at the relevant point of time, the assessing officer could have made a reference provided he was of the opinion that the valuation made by the registered valuer was less than the fair market value of the property. When the valuation made by the registered valuer was on the higher side, there was no occasion for the assessing officer to refer the matter to the valuation officer under section 55A. Therefore, the valuation at a sum of Rs.18,40,244/- as at 1st April, 1981 was correctly accepted by the learned Tribunal. The first question is answered in the positive and against the revenue.

28 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . (f) Hon’ble Mumbai ITAT in Seksaria Industries Pvt. Ltd. v. ITO [2016] 69 taxmann.com 342 [PB 176-186] has held that:

Section 55A of the Income-tax Act, 1961 - Capital gains - Reference to valuation officer - Assessment year 2009-10 - Prior to 1-7-2012, reference could be made to DVO only if value declared by assessee is, in opinion of Assessing Officer, less than its fair market value [In favour of assessee]

The assessee sold its property and adopted value of same at Rs. 5.63 crores as fair market value as on 1- 4-1981 on basis of valuation report of a Government approved valuer. The Assessing Officer referred issue of valuation to DVO, who valued property at Rs. 3.10 crores and the Assessing Officer computed capital gains accordingly.

Held that since value adopted by the assessee was much more than fair market value as on 1-4-1981, then reference to Valuation Officer could not have been made as per provisions of section 55A(a) as it existed at relevant time.’’

5.3 During the course of hearing, the ld. DR relied on the orders of the

lower authorities.

5.4 I have heard the rival contentions and perused the materials

available on record. It is noted from the records that the assessee and

other 5 co-owners obtained a report from registered valuer relating to cost

of land as on 01-04-1981. Shri P.N. Bhargava, registered valuer gave his

report dated 7-07-2008 and adopted the value as at 01-04-1981 at Rs.

200/- per. Sq. Yd. Accordingly, the valuation of the land comes to Rs.

29 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . 37.55 lacs (Assessee's paper book pages 127 to 139). It is also noted that

the AO in the case of Ms. Roopali Dhingra applied the rate at Rs. 40/-

per. Sq. Yd and made the valuation at Rs. 6,89,747/-. It is also noted that

on the basis of the case of Ms. Roopali Dhingra, the case of the assessee

was reopened and the AO adopted the same rate as made in the case of

Ms Roopali Dhingra and thus worked out the valuation of the land as at

01-04-1981 but the case of Ms. Roopali Dhingra has been decided by the

ld. CIT(A), Bikaner (camp at Jaipur) supra deleting the additions,

therefore, the question does not arise to make addition in the case of

assessee. During the course of hearing, the ld. AR of the assessee filed the

family chart of other assessee's (Co-owners) relating to their additions.

From the chart, it is noted in the case of Kavita Bhargava wherein the ld.

CIT(A)-II, Jaipur vide order dated 13-05-2016 had deleted the similar

addition made by the AO u/s 55A(a) for which the Department has not

filed any appeal against the order of the ld. CIT(A). It is also noteworthy

to mention that both the ld. CIT(A)’s have decided the similar issue in

favour of other co-owners i.e. Ms. Roopali Dhingra and Smt. Kavita

Bhargava. It is also noted that such issue has also been decided by the

Hon'ble Gujarat High Court in the case of ACIT vs. Hiraben Govindbhai

Patel (2014) 44 taxmann.com 29 and also by the Hon'ble Bombay High

30 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . Court in the case of CIT vs. Puja Prints (2014),265 CTR 124 in favour of

the assessee. In such circumstances and also taking into considerations

the orders of the lower authorities i.e. ld. CIT(A), Bikaner (camp at

Jaipur ), ld. CIT(A)-II, Jaipur and the decisions of the respective Hon'ble

High Courts (supra), I do not concur with the findings of the ld. CIT(A)

on the issue in question. Thus Grounds No. 3 to 3.2 of the assessee are

allowed.

6.1 Now the appeal of the assessee in the case of Shri Harish Bhargava

in ITA No. 157/JP/2016 for the assessment year 2008-09 is taken up for

adjudication.

7.1 I have heard the rival contentions and perused the materials

available on record. It is noted from the available records that the grounds

of appeal raised by the assessee i.e. Ground No. 1 to 3.2 are similar as in

the case of Smt. Deepali Bharagava (supra). It is also noted that it is not

imperative to repeat the same facts as the ld. CIT(A) has drawn the same

conclusion as made in the case of Smt. Deepali Bhargava. It may be

worthwhile to mention that since the facts of the present case of the

assessee's appeal are similar to the facts of the case of Smt. Deepali

Bhargava (supra), therefore, the decision taken therein shall apply

31 ITA No. 158/JP/2016 Smt. Deepali Bhargava vs. ITO, Ward- 2 (5) Jaipur . mutatis mutandis in the grounds of appeal of the assessee i.e. Shri Harish Bhargava. Thus the Ground No. 1 to 1.1 of the assessee is dismissed and Ground No. 2 to 2.2 & 3 to 3.2 of the assessee are allowed. Conclusively, the appeal of the assessee is partly allowed. 3.0 In the result, the appeals of both the assessee’s are partly allowed. Order pronounced in the open court on 30/05/2017.

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