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TMI Blog2014 (3) TMI 294X X X X Extracts X X X X X X X X Extracts X X X X ..... Deletion made u/s 50C of the Act - Full value of consideration – Valuation of Building – Held that:-It is not clear that the assessee objected to the stamp duty valuation of both the flats or one flat only - If he objected to the valuation of both the flats, then why the matter was referred to the DVO only for one flat - If the matter was referred to the DVO for both the flats, then what about the valuation of the second flat - All these questions arise because in the order of the Assessing Officer, there is no mention of the valuation report of even first flat – Thus, the matter remitted back to the AO for verification of the record – Decided in favour of Revenue. - ITA Nos.1436/Del/2013, 1437/Del/2013 & 1438/Del/2013 - - - Dated:- 28-2-2014 - Shri G. D. Agrawal And Shri Rajpal Yadav,JJ. For the Appellant : Shri Keyur Patel, Sr. DR. For the Respondent : Shri O. P. Sapra, Advocate and Shri Ashutosh, CA. ORDER Per G. D. Agrawal,VP. These appeals by the Revenue are directed against the order of learned CIT(A)-II, Kanpur dated 19th November, 2012 for the AY 2006- 07, 2007-08 2008-09. 2. Ground Nos.1 2 of the Revenue's appeal for AY 2006-07, groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g with regard to deletion of addition of Rs.4,79,773/- is as under:- I have considered the assessment order, submissions of the learned AR and the material placed on record. It is observed that the advances of Rs.51,60,000/- under consideration have been given in earlier years and no disallowance was made for interest in respect of these advances in earlier years; the assessee has explained the business purpose of advances; the AO has not brought any material on record to prove nexus of money borrowed with these advances and the own funds with the assessee are Rs.10.39 crores in comparison to these advances of Rs.0.52 crore only. In view of these facts and the principles laid down in the case laws cited by the learned AR, i.e. SA Builders Ltd. (SC) supra, Reliance Utilities Ltd. (Bom) supra and Hotel Savera Ltd. (Mad), I am of the opinion that the disallowance of interest of Rs.4,79,773/- is not justified. Accordingly, the disallowance is deleted and this ground of appeal is allowed. 4. Similarly, he deleted the disallowance of Rs.5,83,673/- with the following observations:- I have considered the assessment order, submissions of the learned AR and the material placed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... do not find any infirmity in the order of learned CIT(A). Accordingly, his order is upheld and ground Nos.1 2 of the Revenue's appeal for AY 2006-07, ground No.1 of the Revenue's appeal for AY 2007-08 and ground No.2 of the Revenue's appeal for AY 2008-09 are rejected. 6. Ground No.3 of the Revenue's appeal for AY 2006-07, ground No.2 of the Revenue's appeal for AY 2007-08 and ground No.1 of the Revenue's appeal for AY 2008-09 are with regard to disallowance under Section 14A of the Act. 7. We have heard the arguments of both the sides and perused the material placed before us. The facts of the case are that the Assessing Officer computed the disallowance under Section 14A as per Rule 8D for AY 2006-07, 2007-08 and 2008-09. For AY 2006-07 and 2007-08, the CIT(A) held that Rule 8D is not applicable. However, he directed the Assessing Officer to work out the disallowance under Section 14A, if any, having regard to proximity of the expenses to earn the income which did not part form of the total income. After considering the arguments of both the sides and the facts of the case, we find that the direction of the CIT(A) is in conformity with the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceived till date of last hearing. However, the assessee company has placed on record the DVO's report dated 30.12.2010. The valuation as per DVO report is Rs.11,15,000/- as against the valuation for stamp duty at Rs.24,53,220/-. In terms of Section 50C, the AO is bound to refer the matter to DVO and to adopt the value as per DVO report or adopted by stamp duty authority, whichever is lower. It is not justified to adopt the stamp duty valuation in such situation. I, therefore, direct the AO to take into consideration the DVO Report dated 30.12.2010 after his verification and compute the capital gain accordingly. In case of another property at Chintels House, the assessee company disputed the stamp duty valuation but the AO has failed to make the reference to DVO. In view of the case laws cited by the AR, I am of the view that the AO has no choice but to accept the actual sale consideration as market value of property. Moreover, the difference is below 15%. Under this circumstances, the addition of Rs.2,32,930/- on consideration of stamp value is not justified. Accordingly, the addition of Rs.2,32,930/- is deleted. 13. Against the order of learned CIT(A), the Revenue is i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... [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.]. 15. From the above, it is evident that where the assessee objects to the value assessed for stamp duty purposes, then the Assessing Officer is to refer the valuation of capital asset to the Valuation Officer. Now, on the facts as recorded in the assessment order or in the order of the CIT(A), it is not clear that the assessee objected to the stamp duty valuation of both the flats or one flat only. If he objected to the valuation of both the flats, then why the matter was referred to the DVO only for one flat. If the matter was referred to the DVO for both the flats, then what about the valuation of the second flat. All these questions arise because in the order of the Assessing Officer, there is no mention of the valuation report of even first flat. The same was produced by the assessee before the CIT(A). In view of the above, we deem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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