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TMI Blog2014 (2) TMI 78X X X X Extracts X X X X X X X X Extracts X X X X ..... r, Advocate ORDER (Per : Honourable Mr. Justice Akil Kureshi) 1. Facts are identical. Issues involve same parties. We may, therefore, refer to facts as arising in Tax Appeal No.149 of 2013. 2. Revenue is in appeal against the judgment of the Income Tax Appellate Tribunal ( the Tribunal for short) dated 13.7.2012 raising following questions for our consideration. a) Whether in the facts and circumstances of the case, the Hon ble ITAT has erred in law in confirming the order of learned CIT(A) deleting the addition of Rs.81,57,643/- on account of long term capital gain u/s. 48 of the Act by the Assessing Officer on the basis of valuation report called for under section 55A(b)(ii) of the Income-Tax Act? b) Whether in the facts and circumstances of the case, the Hon ble ITAT has erred in law in completely overlooking the provisions of section 55A(b)(ii) of the Income-Tax Act while passing the impugned order confirming the deletion of the addition on account of long term capital gain? c) Whether in the facts and circumstances of the case, the Hon ble ITAT has erred in law in confirming the order of CIT(A) deleting the addition on account of long term capital gain mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed at considerable length various provisions contained in Chapter IV of the Income-Tax Act, 1961 ( the Act for short) besides section 55A thereof. 7. Revenue carried the matter in appeal before the Tribunal. The Tribunal, for reasons somewhat different from those adopted by CIT(Appeals), dismissed the Revenue s appeal. Revenue has thereupon filed present Tax Appeal questioning those decisions. 8. Having heard learned counsel for the parties, we notice that section 55A, as it stood at the relevant time, provided as under:- 55A. With a view to ascertaining the fair market value of a capital asset the purposes of this Chapter, the Assessing Officer may refer the valuation of capital asset to a Valuation Officer- (a) in a case where the value of the asset as claimed by the assessee is in accordance with the estimate made by a registered valuer, if the Assessing Officer is of opinion that the value so claimed is less than its fair market value; (b) in any other case, if the Assessing Officer is of opinion- (i) that the fair market value of the asset exceeds the value of the asset as claimed by the assessee by more than such percentage of the value of the asset as so claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of acquisition of the asset. Section 55A, as we have noticed, refers to the reference to DVO for ascertaining the fair market value of a capital asset. Such ascertainment of fair market value with the aid of the DVO s report would have no relevance for the purpose of determining full value of consideration received or accruing as a result of the transfer of the capital asset for the purposes of section 48 of the Act. 12. In that view of the matter, the reference to DVO for ascertaining the fair market value of the capital asset as on the date of the sale in the present case would be wholly redundant. 13. We are conscious that section 50C of the Act introduced in the statute by Finance Act, 2002 with effect from 1.4.2003 now provides for special provision for full value of consideration in certain cases. The said section provides a deeming fiction under which consideration received or accruing as a result of transfer of a capital asset being land or building or both can be replaced by the value adopted or assessed or accessible by stamp valuation authority for the purpose of payment of stamp duty in respect of such transfer. Sub-section (2) of section 50C, however, permits the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would not be the case of the Assessing Officer that the value of the asset shown as on 1.4.1981 was less than the fair market value. Such clause, therefore, as it stood at the relevant time, had no application to the valuation as on 1.4.1981. We are conscious that with effect from 1.7.2012, the expression now used in clause (a) of section 55A is is at variance with its fair market value . The situation may, therefore, be different after 1.7.2012. We are, however, concerned with the period prior thereto. Clause (b) of section 55A is in two parts and permits a reference to DVO if the Assessing Officer is of the opinion that (i) the fair market value of the asset exceeds the value of the asset so claimed by the assessee by more than such percentage of the value of the asset so claimed or by more than such amount as may be prescribed in this behalf; or (ii) that having regard to the nature of the asset and other relevant circumstances, it is necessary so to do. Sub-clause(i) of clause (b) also for the same reasons recorded above, would have no bearing on the fair market value as on 1.4.1981. The Assessing Officer had not resorted to sub-clause(ii) of clause (b). In any case, clause(b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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