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Facts
The assessee sold a property and offered capital gains tax, using a cost of acquisition of Rs. 1,100/- per sq. meter as per a Registered Valuation Officer's report. The Assessing Officer (AO) referred the matter to the Departmental Valuation Officer (DVO), who estimated the value at Rs. 1,000/- per sq. meter, leading to an addition. The CIT(A) confirmed this addition.
Held
The Tribunal held that the addition made by the AO due to a minor difference in the estimated value of the property as on 01/04/2001 was not warranted. It was noted that in a similar case of co-owners for the same transaction, the AO had accepted the cost of acquisition at Rs. 1,100/- per sq. meter.
Key Issues
Whether the addition made by the AO based on a minor difference in valuation by the DVO, when a registered valuer's report and a co-owner's case supported a higher value, is justified.
Sections Cited
250
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Income Tax Appellate Tribunal, SURAT BENCH ‘SMC’, SURAT
Before: Shri Sanjay Garg
Year : 2022-23 Manishabne Kaizad Motawala The TTO बनाम/ A-32, Yoganand Nagar Ward-2(3)(1) v/s. Sacin Roadsankri Surat – 395 001 Akoti B.O., Surat 394 355 (Gujarat) "थायी लेखा सं./PAN: AOTPP 0951 L (अपीलाथ&/ Appellant) ('( यथ&/ Respondent) Assessee by : Shri Rasesh Shah, CA Revenue by : Shri Ajay Uke, Sr.DR सुनवाई की तारीख/Date of Hearing : 08/01/2026 घोषणा की तारीख /Date of Pronouncement: 19/01/2026 आदेश/O R D E R The present appeal has been preferred by the assessee against the order of the Learned Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘CIT(A)’] dated 04/06/2025 passed u/s.250 of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) for the Assessment Year (AY) 2022-2023.
The assessee, in this appeal, has taken following grounds of appeal:
1. Hon'ble CIT(A) has erred in confirming the total assessed income at Rs. 13,61,528/- for A.Y. 2022-23. Manishabne Kaizad Motawala vs. ITO Asst. Year : 2022-23
2. On the basis of facts and circumstances of the case, the Hon'ble CIT(A) has wrongly confirmed the cost of acquisition of the ancestral property situated at R.S. No. 265, Block No. 284, Sachin, Tal Choryasi, Dist. Surat as on 01.04.2001 at Rs. 1,57,83,000/- instead of correct value of Rs. 1,73,61,300/- applied by the assessing officer.
3. Hon'ble CIT (A) failed to appreciate the fact that in the case of a co-owner of the same property Mrs. Gayantriben Amishkumar Patel, the learned assessing officer had accepted the valuation of Rs. 1100/- per meter.
4. The appellant craves leave to add, to alter or to amend, to modify and change the present grounds of appeal.”
3. At the outset, the Ld. Counsel for the assessee has submitted that the assessee had sold property for Rs.1,25,00,000/- and offered capital gain tax on the same. While doing so, the assessee took the cost of acquisition at Rs.39,00,28,299/- and the indexed cost of Rs.1,24,52,391/- which was arrived by taking the cost of acquisition at Rs.1,100/- per sq. meter as per Registered Valuation Officer’s report as on 01/04/2001. The Assessing Officer (AO), however, referred the matter to the Departmental Valuation Officer (DVO), who estimated the value at Rs.1,000/- per sq.meter as on 1.4.2001. The AO calculated the indexed cost of acquisition on the basis of DVO’s report and added the differential amount.
The Ld. CIT(A) confirmed the addition so made by the AO.
5. The Ld.AR of the assessee, before me ,has submitted that the DVO has only estimated the value and there is a minor difference of Rs.100 per sq. meter only between the valuation done by the Registered Valuer and the DVO. He has further submitted that in the case of Joint/Co-owners, similar issue had arisen, wherein the AO had called for DVO’s report and in that case also, finally, the AO accepted the cost of acquisition at Rs.1,100/- per sq.meter. He also referred to paper book at page No.141, which is a copy of the assessment order in the case of “Punit Babubhai Patel”, wherein, in respect of the same transaction, the cost of acquisition shown by the Registered Valuer has been accepted. Under the circumstances, in my view, the Manishabne Kaizad Motawala vs. ITO Asst. Year : 2022-23 addition, because of miner difference in estimation of the value as on 01/04/2001, is not warranted. Therefore, the impugned addition made by the AO is hereby deleted.
In the result, the appeal of the assessee stands allowed.
Order pronounced in the Open Court on 19/01/2026. ( Sanjay Garg ) Judicial Member