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TMI Blog2011 (5) TMI 668X X X X Extracts X X X X X X X X Extracts X X X X ..... nd in law the Ld. CIT(A)-II, Surat has erred in sustaining the addition of Rs. 1,12,201/-on the basis of stamp duty valuation u/s. 50C of the Act. The Ld. CIT (A) somehow ignored all the submission and confirmed the addition." 2. On the facts and in the circumstances of the case and in law the addition stated above deserves to be deleted. Hence ,it is prayed to your honour to delete the addition and do justice 3. Your appellant reserves his right to add, amend, alter and/or withdraw any ground of appeal at the time of hearing of the appeal. ITA No.3193/Ahd/2009 "(1) On the facts and in the circumstances of the case and in law the Ld. CIT(A)-II, Surat has erred in sustaining the addition of Rs. 1,91,000/-on the basis of stamp duty valuation u/s. 50C of the Act. The Ld. CIT (A) somehow ignored all the submission and confirmed the addition." (2) On the facts and in the circumstances of the case and in law the addition stated above deserves to be deleted. Hence ,it is prayed to your honour to delete the addition and do justice (3) On the facts and in the circumstances of the case and in law the Ld. CIT(A)-II, Surat has erred in sustaining the addition of Rs. 54588 on the point of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3,100) being the difference between valuation made by SVA & the consideration mentioned in the sale deed executed on sale of property at Room no.1 in basement and hall no.2 on the ground floor, Diamond Trader Apartment Co-operative Housing Society Ltd., Dalgiyana Mohallo, Mahidarpura, Surat ,in terms of provision of sec. 50C of the Act, on the ground that the assessee did not exercise the option available in sub-section(2) of section 50C of the Act and instead accepted the valuation made by SVA. 5. Similarly, in the case of Zunzaabhai P. Patel, while referring to a decision of the Hon'ble Apex Court in George Henderson & Co. Ltd's. case (supra), the AO pointed out that the assessee did not exercise the option available in sub-section (2) of section 50C of the Act and accordingly, the A.O. adopted the FVC of Rs. 20,21,000/-and brought to tax an amount of Rs. 1,91,000/- being the difference between valuation made by SVA & the consideration mentioned in the sale deed executed on sale of land at Rundh, in terms of provision of sec. 50C of the Act. 6. On appeal, the Ld. CIT (A), upheld the findings of the Assessing Officer in the case of Shri Sanjaybhai Z. Patel in the following terms ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, even though the application of the 'jantri price' and the valuation of the property by the SVA is made for Stamp Duty purposes yet, when such valuation is incorporated in the I.T. Act to check and pervert the understatement of Capital Gain, there is an inherent and indisputable presumption, such as in the case of the assessee that, where the valuation of the SVA is higher than the document price, it does not require any evidence to establish and confirm the fact of understatement of sale consideration. Consequently, a higher valuation by the SVA leads inevitably to the conclusion that there has been an understatement of capital gain accruing from the transfer of such property. (6.3) Given such facts and circumstances of the case, as discussed above, I have come to the inevitable conclusion that the AO was fully justified in re-computing the STCG on the transfer and in adding the assessee's share to his total income,. The addition of the sum of Rs. 1,91,000/- is confirmed." 7. Similarly in the case of Champaben Z. Patel, the ld. CIT (A) upheld the findings of the AO, holding as under:- "(5) I have carefully considered both the positions. The AR has made an interesting referen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that there has been an understatement of capital gain accruing from the transfer of such property. (5.2) Given such facts and circumstances of the case, as discussed above, I have come to the inevitable conclusion that the AO has fully justified in re-computing the LTCG on the transfer of such property and in adding the assessee's share to his total income. The addition of the sum of Rs. 1,12,201/- is confirmed." 8. For similar reasons, in the case of Shri Zunzabhai P. Patel, the ld. CIT (A) upheld the findings of the AO, holding as under:- "(6) I have carefully considered both the positions. Firstly, the AR has claimed that the assessee's share in the addition of Rs. 1,91,000 made u/s. 50C was only Rs. 1,14,600. This fact apparently was not brought before the AO as is evident from the detailed assessment order where the AO has placed on record and discussed all possible angles and interpretations pertaining to the application of the provisions of section 50C of the I. T. Act. However, the AO is directed to verify the claim of the AR and take appropriate action in this regard. (6.1) The AR has made an interesting reference to the provisions of sec. 269C of the I.T. Act, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruing from the transfer of such property. (6.3) Given such facts and circumstances of the case, as discussed above, I have come to the inevitable conclusion that the AO was fully justified in re-computing the STCG on the transfer and in adding the assessee's share to his total income,. The addition of the sum of Rs. 1,91,000/- is confirmed." 9. These three assessees are now in appeal before us against the aforesaid findings of the ld. CIT(A). None appeared on behalf of these three assessees and instead written submissions have been filed. While reiterating their submissions before the ld. CIT(A), the assessees relied upon decisions in Rahul Constructions v. Dy CIT [2010] 38 DTR 19 (ITAT, Pune) and K.P. Varghese v. ITO [1981] 131 ITR 597/7 Taxman 13 (SC) & contended that difference between the FMV determined by the SVA and sale consideration shown by the assessees being less than 10%, the computation made by them be accepted. Inter alia, the assessee cited decisions in CIT v. Smt. Raj Kumari Vimla Devi [2005] 279 ITR 360 (All), Dinesh Kumar Mittal v. ITO [1992] 193 ITR 770/[1991] 58 Taxman 179 (All.), UP Jal Nigam v. Kalra Properties (P) Ltd. AIR 1996 SC 1170; CGT v. R. Damodaran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the Assessing Officer under subsection (1) of section 16A of that Act. Explanation 1 - For the purposes of this section, "Valuation Officer" shall have the same meaning as in clause (R) of section 2 of the Wealth tax Act, 1957 (27 of 1957). Explanation 2. - For the purposes of this section, the expression "assessable" means the price which the stamp valuation authority would have, notwithstanding anything to the contrary contained in any other law for the time being in force, adopted or assessed, if it were referred to such authority for the purposes of the payment of stamp duty. (3) Subject to the provisions contained in sub-section (2), where the value ascertained under sub-section (2) exceeds the value adopted or assessed [or assessable] by the stamp valuation authority to in subsection (1), the value so adopted or assessed [or assessable] by such authority shall be taken as the full value of the consideration received or accruing as a result of the transfer." 10.1 A mere glance at the aforesaid provisions indicates that for invoking the provisions of s. 50C of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been made before any other authority, court or the High Court. In these circumstances, we do not find any infirmity in the findings of the ld.CIT(A). We find that a similar view has been taken by the Hon'ble Madras High Court in Ambattur Clothing Co. Ltd. v Asstt. CIT [2010] 326 ITR 245 (Mad). 10.3 In the case of Sharad Dinesh Photographer v. ITO [2011] 43 SOT 452/9 Taxmann.com 125 (Mum.), the ITAT found that the assessee reflected capital gain on the sale of house property, which was claimed to have been received as a gift from her husband in the year 1995-96. The fair market value of the property as on 1-4-1981 as per provisions of section 55(2)(b) was adopted which was taken at 10.25 lakhs as per the valuation report of the registered valuer. The assessee had shown the sale consideration at Rs. 65 lakhs but the SVA determined the value at Rs. 1,03,32,000/- for the purpose of registration. The Assessing Officer invoked the provisions of section 50C and adopted the sale consideration at Rs. 1,03,32,000 in place of Rs. 65 lakhs declared by the assessee and determined the long-term capital gain at Rs. 55,86,250, after giving the benefit of the indexation cost of the acquisition. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of decision in Rahul Construction's case (supra), the assessees have not demonstrated as to how the said decision is applicable to the facts and circumstances in the instant cases. In the cited decision, reference was made to DVO and since the difference between sale consideration of the property shown by the assessee and the FMV determined by the DVO was less than 10%, the ITAT concluded that the AO was not justified in substituting the value determined by DVO. But In the present case, as already stated, these assessees accepted the value adopted by the stamp valuation authority under sub-section (1) and did not even care to submit the fair market value of the property as on the date of transfer. In these circumstances, reliance placed by these assessees in their written submissions on the said decision is totally misplaced. 10.5 Regarding reliance on the decision of the Hon'ble Supreme Court in the case of K. P. Varghese (supra), a co-ordinate Bench have already held in Sharad Dinesh Photographer's case (supra) that the principle laid down by the Hon'ble Supreme Court in the case of K. P. Varghese (supra) cannot be applied for interpreting the section 50C, putting the burden o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... court cautioned (at page 578 of AIR 1971 SC)." 10.61 Moreover, Hon'ble Supreme Court cautioned in their decision dated 6.3.2009 in the case of State of AP v. M.Radha Krishna Murthy [Criminal Appeal no. 386 of 2002] in the following words: "6. Courts should not place reliance on decisions without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. Observations of Courts are neither to be read as Euclid's theorems nor as provisions of the statute and that too taken out of their context. These observations must be read in the context in which they appear to have been stated. Judgments of courts are not to be construed as statutes. To interpret words, phrases and provisions of a statute, it may become necessary for judges to embark into lengthy discussions but the discussion is meant to explain and not to define. Judges interpret statutes, they do not interpret judgments. They interpret words of statutes; their words are not to be interpreted as statutes ** ** ** 8. Circumstantial flexibility, one additional or different fact may make a world of difference between conclusions in two cases. Disposal of ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o press this ground of appeal. The addition of the sum of Rs. 54,588/- under the provisions of sec. 68 of the IT Act is confirmed." 13. The assessee is now in appeal before us against the aforesaid findings of the ld. CIT(A).In the written submissions, the assessee submitted that amount has been transferred from treasury office, Government of Gujrat. The ld. DR on the other hand pointed out that the assessee did not submit any evidence either before the lower authorities and even now along with his written submissions, mentioning that amount was received from treasury. In these circumstances, the assessee is not entitled to any relief. 14. We have heard the ld. DR and gone through the facts of the case. As is apparent from the impugned orders, the assessee did not submit any evidence before the AO in respect of credit of Rs. 54588/- in the capital account. On appeal, the assessee neither submitted any evidence nor argued the issue before the ld. CIT(A). Accordingly, the ld. CIT(A) concluded that the assessee did not wish to press this ground. Even before us, though the assessee in his written submissions mentioned that amount has been transferred from treasury office, Government ..... X X X X Extracts X X X X X X X X Extracts X X X X
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