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2013 (11) TMI 271 - AT - Income TaxValuation - rent capitalization method - determination of fair market value (FMV) as on 1.4.1981 sale of the impugned property - Held that - following the decision in the case of Shri Jay Harshad Shah (HUF) vs. ITO 2013 (11) TMI 74 - ITAT MUMBAI , since the issue of adoption of value under section 50C was referred to the AO by the CIT(A), this issue also required to be set aside to the file of AO. Therefore, both issue of sale consideration under section 50C(2) and cost of acquisition as on 01.04.81 for computing of capital gains should be examined by AO afresh Reassessment - Reasons to be recorded for issuance of notice u/s 148 - Held that - in view of decision in the case of Shri Jay Harshad Shah (HUF) vs. ITO 2013 (11) TMI 74 - ITAT MUMBAI , wherein it was held that it is only the processing u/s. 143(1) which was completed in assessee s case and AO took proceedings in all the group cases as can be seen from the various orders before ITAT for examining the capital gains computation. Since not only in assessee s case but action was taken in other co-owners case, we are of the opinion that action of the AO has to be upheld, keeping in view the principles laid down by the Hon ble Supreme Court in the case of Rajesh Jhaveri Stock Brokers Pvt. Ltd. 2007 (5) TMI 197 - SUPREME Court Decided partly in favor of Assessee.
Issues:
1. Validity of notice issued u/s 148(2) for reopening assessment. 2. Adoption of valuation report for determining capital gains. Issue 1 - Validity of notice u/s 148(2) for reopening assessment: The appeal was filed against the order of the CIT(A) upholding the validity of the notice issued u/s 148(2) for reopening the assessment. The appellant contended that there were no cogent reasons recorded for the reopening and no new material was gathered by the Assessing Officer (AO). The AO calculated Long Term Capital Gain based on Stamp Office Valuation instead of the actual sale consideration, rejecting the appellant's request to refer the valuation to the Valuation Department. The appellant claimed deduction of indexed cost of acquisition and obtained a valuation report, which the AO rejected without proper justification. The AO's authority to issue notice u/s 148 was questioned as the assessment made u/s 143(3) was time-barred. The AO rejected all contentions, leading to the appeal. Issue 2 - Adoption of valuation report for determining capital gains: Regarding the adoption of the valuation report for determining capital gains, the AR pointed out that a coordinate Bench had restored a similar issue to the AO in another case. The AR conceded that consistency among co-owners' cases was essential. The coordinate Bench directed the AO to re-examine the issues of sale consideration under section 50C(2) and cost of acquisition as on 01.04.1981. The AR urged for a similar treatment in the instant case for uniformity. After considering arguments from both parties, the Tribunal decided to follow the coordinate Bench's decision in another case and rejected ground no. 1 while restoring the issue in ground no. 2 to the AO for re-examination. The decision was held to be allowed for statistical purposes. In conclusion, the Tribunal partly allowed the case of the assessee based on the issues raised and the arguments presented. The judgment emphasized the importance of following consistent decisions among co-owners' cases and directed the AO to re-examine the valuation issues for determining capital gains.
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