ASARAM SHANKAR PERKAR,,AURANGABAD vs. ASSISTANT COMMISSIONER OF INCOME TAX,,

The brief facts of the case as emanating from records are : The assessee sold agriculture land comprising in Gut No. 212, Satara

Shri Pramod Shingte appearing on behalf of the assessee submitted that the assessee is an agriculturist. The assessee sold agricultural land for Rs.45,00,000/-. The cost of acquisition of land was Rs.2,00,000/- and offered the Capital Gain arising there from for tax. The Assessing Officer took the sale value as per Government valuation and made addition of Rs.6,75,000/-. The difference between the sale value declared by the assessee and the sale value determined by the Assessing Officer is approximately 13%. The ld. AR submitted that the Hon’ble Supreme Court of India in the case of C.B. Gautam Vs. Union of India & Ors. reported as 199 ITR 530 has approved tolerance limit of 15% variation in estimating sale value. The ld. AR submitted that the Pune Bench of Tribunal in the case of Rahul Constructions Vs. Deputy Commissioner of Income Tax reported as 38 DTR 19 allowed relief to assessee where the difference between the sale consideration shown by the assessee and the fair market

On the other hand Shri Rajesh Gawli representing the Department vehemently supported the order of Commissioner of Income Tax (Appeals) in confirming the addition. However, the ld. DR submitted that in proceedings before the First Appellate Authority the assessee had offered addition over and above 10% of the difference between the sale value disclosed by the assessee and Government valuation.

We have heard the submissions made by representatives of rival sides and have perused the orders of authorities below. The solitary issue raised in the appeal is with respect to the addition on account of Capital Gain in respect of sale of agricultural land. The assessee sold the land for Rs.45,00,000/- and offered the gain under the head Capital Gain. The Assessing Officer invoked the provisions of section 50C and took the Government valuation i.e. Rs.51,75,000/- as sale consideration. The contentions of the assessee is that where the difference in the sale value declared by the assessee and value determined by the Assessing Officer is less than 15%. No addition is warranted. We find in the present case there is difference of 13% in the value declared by the assessee and as determined by the Assessing Officer. The Co-ordinate Bench of the Tribunal in the case of Rahul Constructions Vs. Deputy Commissioner of Income Tax (supra) has taken a tolerance limit of difference in two valuations as 10%. Similar view has been taken by the Hon’ble Jammu & Kashmir High Court in the case of Honest Group of Hotels (P) Ltd. Vs.

In the result, the impugned order is modified to the extent mentioned above and the appeal of assessee is partly allowed.