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TMI Blog2014 (1) TMI 1625X X X X Extracts X X X X X X X X Extracts X X X X ..... ceed to determine capital gain on sale of the properties in question after affording opportunity of being heard to the assessee. - Decided in favour of assessee for statistical purposes. Penalty u/s 271(1)(C) - CIT(A) deleted the penalty - Held that:- Valuation of property for stamp duty purposes was rebuttable issue hence in order to prove concealment or furnishing of inaccurate particulars, AO had to establish that “on money” had changed hands or that substantial evidence / material was available to prove that the assessee had filed inaccurate particulars of income. It is an established proposition of law that before invocation of penal provisions laid down u/s 271(1)(c) of the Act, the AO had to establish beyond doubt that there was concealment of particulars of income or furnishing inaccurate particulars thereof on the part of the assessee while claiming the turned down relief resulting in the above addition on the basis of which penal proceedings have been initiated. Also because the addition on which penalty in question has been imposed has been set aside in the above appeal to the file of the AO for fresh consideration in view of the provisions laid down u/s 50C of the Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at no proper claim before the AO has been filed stating that the value adopted or assessed by the stamp valuation authority exceeds the fair market value. 4. In support of the grounds the Ld. AR submitted that in such a situation and facts of the case when the assessee had disputed before the AO the value adopted by the stamp valuation authority was not the fair market value of the property at the time of the transaction, it was mandatory on the part of the AO to refer the valuation of the said property u/s 50C (2) of the Act. In this regard he referred the contents of last page of the assessment order wherein the AO had mentioned that the section 50C (2) uses the word may or not shall refer the matter to the valuation officer defined u/s 2 of the Wealth Tax Act 1957. The AO has further mentioned that sufficient evidence was not produced before her to enable her to make reference to the valuation sale under clause 50C(2)(b) of the Act. In support the Ld. AR referred following decisions :- 1. ITO vs. Smt. Manju Rani Jain (2008) 24 SOT 24 (Delhi) 2. K.K. Nag Ltd. vs. ACIT (2012) 52 SOT 381 (Pune) 3. N. Minakeshi vs. ACIT 226 CTR 625 (Madras) 4. Nathu Ram Premchand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ght to have referred the matter to the valuation officer to ascertain the valuation. For a ready reference the matter travel to the Tribunal and the Tribunal has held as under :- Section 50C prescribes for adoption of full value of consideration in certain cases. It is provided that where the consideration received or accrued as a result of the transfer of a capital asset being land or building or both is less than the value adopted by an authority of the State Government for the purposes of payment of stamp duty in respect of such transfer, then the value so adopted by the State Government authority shall be deemed to be the full value of consideration received or accruing as a result of such transfer. The said provisions of sub-section (1) of section 50C are further circumscribed by sub-section (2) of section 50C. In terms of clause (a) of sub-section (2) of section 50C, it is provided that where an assessee claims before the Assessing Officer that the value adopted or assessed by the Stamp valuation authority under sub-section (1) exceeds the fair market value of the property as on the date of transfer, then the Assessing Officer may refer valuation of the capital asset to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he matter to the valuation officer defined u/s 2 of the W.T. Act 1957. Sufficient evidence has not been produced before the undersigned to enable her to make reference to the valuation cell under clause 50C(2)(b). The Ld. CIT(A) has upheld this action of the AO. Thus the point made out by the revenue was that it is only discretion on the part of the AO to refer the matter to the valuation officer to which we in view of the provisions laid down u/s 50(c) of the Act do not concur with. The Pune Bench of the Tribunal in the case of K.K. Nag Ltd. vs. ACIT (supra) after detailed discussion of the provisions laid down u/s 50C of the Act has held that the discretion granted in such a situation is required to use in a judicious manner. Section 50C is a deeming provision and ostensibly involve creation of an additional tax liability on the assessee and, therefore, notwithstanding the presence of the expression may in section 50C(2)(a), the AO in this case ought to have referred the matter to the valuation officer for ascertaining the value of the capital asset in question. The order of the Commissioner (Appeals) was thus held to be set aside and the AO was directed to adopt the course m ..... X X X X Extracts X X X X X X X X Extracts X X X X
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