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Facts
The assessee sold a capital asset for Rs. 16,00,000/-, while its stamp duty valuation was Rs. 30,50,000/-. The lower authorities applied Section 50C of the Income Tax Act, adding the difference as capital gains in the assessment order without making a reference to the Departmental Valuation Officer (DVO).
Held
The Tribunal observed that a statutory reference to the DVO under Section 50C(2) of the Act is mandatory, as established by the Sunil Kumar Aggarwal Vs. CIT (2015) 372 ITR 83 (Cal.) judgment. Consequently, the tribunal restored the matter to the Assessing Officer for a fresh adjudication, with directions to make an appropriate reference to the DVO.
Key Issues
Whether a mandatory reference to the Departmental Valuation Officer (DVO) is required under Section 50C(2) of the Income Tax Act when applying Section 50C for computing capital gains based on stamp duty valuation.
Sections Cited
143(3), 50C, 50C(2)
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Income Tax Appellate Tribunal, DELHI BENCH ‘SMC’, NEW DELHI
Before: Sh. Satbeer Singh Godara
Asstt. Year: 2017-18 Dharam Vir Singh, Vs Income Tax Officer, Ch. No. 206-207, Ansal Satyam, Ward-2(1)(2), RDC, Rajnagar, Ghaziabad-201002 Ghaziabad-201001 (APPELLANT) (RESPONDENT) PAN No. BGNPS6913C Assessee by: Sh. Govind Aggarwal, CA Revenue by : Sh. Amit Shukla, Sr. DR Date of Hearing: 23.12.2025 Date of Pronouncement: 23.12.2025 ORDER This assessee’s appeal for Assessment Year 2017-18 arises against the Addl./JCIT(A)-1, Delhi’s DIN & order No. ITBA/APL/S/250/2025-26/1081763232(1) dated 15.10.2025, in proceedings u/s 143(3) of the Income Tax Act, 1961 (in short “the Act”).
Heard both the parties at length. Case file perused.
It emerges during the course of hearing that both the learned lower authorities have invoked section 50C of the Act for adding the difference between the assessee’s sale price of the relevant capital asset amounting to Rs.16,00,000/- and stamp valued thereof of Rs.30,50,000/-, as his capital gains derived in the relevant previous year, in assessment order dated 29.04.2019 as upheld in the lower appellate discussion.
Dharam Vir Singh 4. That being the case, learned departmental representative could hardly dispute that both the lower authorities have nowhere made any statutory reference to the DVO u/s 50C(2) of the Act which has been held mandatory in Sunil Kumar Aggarwal Vs. CIT (2015) 372 ITR 83 (Cal.). I accordingly deem it appropriate to restore the assessee’s instant sole substantive ground back to the learned assessing authority for it’s afresh appropriate adjudication as per law in very terms. All other issues are kept open at this stage.