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TMI Blog2013 (11) TMI 208X X X X Extracts X X X X X X X X Extracts X X X X ..... e, the consideration accountable in the hands of the assessee-company for the purpose of section 50C is fixed at Rs. 2.5 crores - Decided partly in favour of assessee. - IT Appeal No. 988 (Mds.) of 2011 - - - Dated:- 7-1-2013 - Order The order of the Bench was delivered by Dr. O. K. Narayanan (Vice-President).-This appeal is filed by the Revenue. The relevant assessment year is 2005-06. The appeal is directed against the order of the Commissioner of Income-tax (Appeals)-V, at Chennai, dated March 22, 2011 and arises out of the assessment completed under section 143(3) of the Income-tax Act, 1961. In the previous year relevant to the assessment year under appeal, the assessee had sold a portion of the land of its factory property sit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the assessment was completed by adopting the guideline value of Rs. 3,95,91,000. This issue was taken in the first appeal before the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax (Appeals), relying on the judgment of the hon'ble Supreme Court in the case of CWT v. Sharbati Devi Jhalani [1994] 207 ITR 1 (SC), held that the valuation report is not binding on the appellate authorities. On the basis of the above, he examined the various arguments and explanations put forth by the assessee and determined the consideration at Rs. 2.25 crores. The Revenue is aggrieved and therefore the second appeal before the Tribunal. We heard Shri G. K. Dhall, the learned Commissioner of Income-tax appearing for the Revenue. The lea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t Valuation Officer. But, he straightaway went to accept the consideration stated by the assessee in the sale deed. The learned Commissioner of Income-tax contended that this is quite against law and the finding of the Commissioner of Income-tax (Appeals) is unsustainable. Shri S. Nagarajan, the learned chartered accountant appearing for the assessee, on the other hand, supported the order passed by the Commissioner of Income-tax (Appeals). The learned chartered accountant explained that the sale of property made by the assessee-company was a distress sale. The assessee-company had to pay huge amount of loan availed from the UCO Bank. In that context the UCO Bank had got the property valued before the sale made by the assessee-company. At ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in accordance with law. The order passed by the Commissioner of Income-tax (Appeals) in the present case is not without any basis. The order is not arbitrary. It is a speaking order. It has examined all the aspects of the case. In these circumstances, the learned chartered accountant submitted that there is no merit in the appeal filed by the Revenue. We heard both sides in detail. Section 50C of the Act provides that where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government, referred to as the stamp valuation authority for the purpose of payment of stamp duty i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er was to complete the assessment by adopting the guideline value of Rs. 3,95,91,000. Therefore, there is no infirmity in the order passed by the Assessing Officer. But, still it is within the authority of the appellate authority to hear the assessee on the question of value of consideration and grant appropriate relief, depending upon the facts and circumstances of the case. In the present case, the Commissioner of Income-tax (Appeals) had the occasion to go through the report of the District Valuation Officer, wherein the value was determined at Rs. 3,54,73,536. The Commissioner of Income-tax (Appeals) is fully competent to go below this valuation, as the report of the District Valuation Officer is not binding on the Commissioner of Inc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at a provision for reference to the District Valuation Officer is given in the section. But, while considering the report of the District Valuation Officer and other such factors to interfere in the valuation of the property, it is not permissible for the appellate authorities to consider personal and individual reasons. The relief granted by the appellate authority should be on the basis of apparent features of the property in question. The misfortunes happened to the assessee or the difficulties faced by the assessee or the matter of distress sale, etc. cannot be a ground to modify the valuation. If such extraneous factors are relied upon, we would be contravening the deeming provision of law stated in section 50C of the Act. Therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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