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2015 (5) TMI 77 - HC - Income TaxDetermination of the market value of immovable property as on 01.04.1981 - valuation of the said property has been made on the basis of an alleged agreement of sale dated 12.12.1978 by tribunal - Held that - We find substance in the submissions made by learned Counsel for the appellant, as the very basis for valuation of the property, which was the agreement for sale, was itself held not to be a valid agreement. The fair market value of the property as assessed by the Tribunal cannot be said to be a proper mode of assessment. We therefore hold that the fair market value of the property as determined by the Tribunal, was without any proper basis. Matter should be decided afresh by the Assessing Officer after ignoring the agreement for sale dated 12.12.1978 and on the basis of the other factors relevant, for consideration of the fair market value. We thus answer the question of law in favour of the assessee
Issues Involved:
Determining the market value of an immovable property as on 01.04.1981 based on an alleged agreement of sale dated 12.12.1978 which was dismissed by the Trial Court. Analysis: The High Court heard the appeal concerning the valuation of a property on 01.04.1981 based on an agreement of sale dated 12.12.1978. The Tribunal had upheld the market value of the property at Rs. 10 lakhs, relying on the alleged agreement. However, the suit filed by the purchaser based on the same agreement was dismissed, not decreed in favor of the purchaser. The appellant argued that since the agreement was not deemed valid by the Trial Court, the property's value should have been determined based on fair market value, not the disputed agreement. The Court agreed with the appellant's contention, stating that the valuation of the property solely based on the agreement, which was deemed invalid, was improper. The fair market value assessment by the Tribunal lacked a proper basis. Consequently, the Court ruled in favor of the assessee, highlighting the need for a reassessment of the property's value by the Assessing Officer without considering the disputed agreement. The parties agreed that the matter should be reevaluated by the Assessing Officer, disregarding the contentious agreement and considering other relevant factors to determine the fair market value accurately. Therefore, the Court allowed the appeal, directing a fresh assessment by the Assessing Officer in compliance with the law. No costs were awarded in the judgment.
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