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TMI Blog2016 (6) TMI 451X X X X Extracts X X X X X X X X Extracts X X X X ..... 282/-. Further the assessee had claimed improvement cost in F.Y. 2000-01 at ₹ 3.00 lacs and in F.Y. 2004-05 at ₹ 1,30,000/- in which indexation has been claimed by the assessee but the assessee had not produced any evidence before the lower authority to demonstrate that his mother in law had incurred any cost on improvement. Even registered valuer of the assessee and DVO of the department has not referred any improvement in the valuation report, therefore, we dismiss the assessee’s appeal on indexation claimed in F.Y. 2000-01 and 2004-05. Deduction U/s 54F of the Act on two flats - Held that:- This issue has been considered by the various courts and in number of cases that this deduction is allowable on even two flats, which can be a complete unit or even can be on different floors of the apartment. Accordingly we allow the deduction U/s 54F of the Act on two flats. Adoption of sale consideration - Held that:- As for deduction U/s 54, the sale consideration is to be taken on the basis of actual sale consideration received by the assessee not determined by the stamp authority for the registration purposes or determined by the DVO referred U/s 50C of the Act. - IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see was having half share in the property, therefore, the assessee had shown her share at ₹ 60.00 lacs. The assessee has calculated capital gain on sale of this building as under:- Sales Consideration ₹ 60,00,000/- Less:- Transfer expenses ₹ 2,69,675/- Value to previous owner F.Y. 1981-82 ₹ 1,92,282/100*582 ₹ 11,19,081/- Improvement cost F.Y.- 2000-01 ₹ 3,00,000/406*582 ₹ 4,30,049/- F.Y.- 2004-05 ₹ 1,30,000/480*582 ₹ 1,57,625/- ₹ 17,06,755/- ₹ 40,23,570/- Deduction U/s 54 ₹ 36,63,980/- Long Term Capital Gain ₹ 3,59,590/- The ld Assessing Officer asked to furnish the evidences of improvement made in the property for ₹ 3.00 lacs during the F.Y. 2000-01 and ₹ 1,30, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the sale consideration shown by the assessee and value determined by the DVO is less than 5%, therefore, it could be ignored because the DVO estimated the FMV. The assessee also challenged the FMV taken by the Assessing Officer from the DVO as on 01/4/1981. The assessee also submitted that indexation is required to be given from 1981 not from F.Y. 2005-06 on cost of improvement as well as FMV as on 01/4/1981. After considering the assessee s reply, the ld Assessing Officer held that the assessee requested to refer the matter to the DVO U/s 50C(2) of the Act. As per this Section, consideration is to be taken as per stamp value had taken for the purpose of registration. There is two valuation held from registered valuer given by the assessee and another DVO taken by the Assessing Officer as on 01/4/1981. The ld Assessing Officer decided to take DVO s FMV as on 01/4/1981 authentic than registered valuer. He further relied on the decision in the case of Namita Sarkar Vs CIT (2005) 275 ITR 590 (Cal) wherein it has been held that for computation of capital gave, the report of the valuer was not conclusive, Income tax authorities can reject report and get property valued or value it. He ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e has considered the Hon ble Punjab Haryana High Court decision in the case of Pawan Arya Vs CIT 49 DTR 123, decision of Hon ble Karnataka High Court in the case of CIT Vs Smt. K.G. Rukminiamma 331 ITR 211 and decision of Hon ble Pune Bench in the case of Gopal D. Shetty Vs ITO 298 ITR AT 049. The case laws referred by the assessee were found distinguishable on facts and circumstances of the case. In this case, two houses were combined together to make one habitable unit whereas in the present case, two residential houses were in B-Block and D-Block in Vaishali Nagar. These two residential houses were separate and could not be combined to make one habitable unit. Therefore, he dismissed the assessee s appeal on this ground. 4. Now the assessee is in appeal before us. The ld AR of the assessee has submitted that it has been held by the ld CIT(A) that the assessee has taken FMV as on 01/4/1981 at ₹ 1,92,282/- whereas as per DVO s report, it was ₹ 1,28,700/-. Reference made by the Assessing Officer to DVO to department the FMV value as on 01/4/1981 was not found him justifiable. He further relied on the decision of Hon ble Calcutta High Court in the case of Namita Sar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property. He further relied on the decision of Hon'ble Supreme Court in the case of Bajaj Tempo Ltd. Vs CIT 196 ITR 188 wherein it has been held that interpretation of Section 54 is to be made literally to allow deduction on more than one residential unit. He further relied on the following case laws:- (i) CIT Vs Gita Duggal (Del) 30 Taxmann.com 320 (Del) (ii) CIT Vs Sunita Agarwal 284 ITR 20 (Del) (iii) Anand Basappa, 309 ITR 329 (Kar.) (iv) CIT-II, Hyderabad Vs Syed Ali Adil 33 Taxmann.com 212 (AP). (v) CIT Vs Jyothi K Mehta (2011) 201 Taxmann 79. The case laws referred by the Assessing Officer as well as ld CIT(A) are distinguishable. It is settled law that if there are more than one views on the issue, then favourable view will be taken to the assessee as held by the Hon'ble Supreme Court in the case of CIT Vs Vegetable Products Ltd. (1973) 88 ITR 192 (SC), which has been confirmed by the Hon'ble Supreme Court in the case of CIT Vs Vatika Township Pvt. Ltd. (2014) 367 ITR 466 (SC). He further argued that in Section 55A, no reference can be made for A.Y. 2009-10 to determine the FMV as on 01/4/1981 as this reference can be made if the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 03, Chitrakoot Nagar, Jaipur. This issue has been considered by the various courts and in number of cases that this deduction is allowable on even two flats, which can be a complete unit or even can be on different floors of the apartment. Accordingly we allow the deduction U/s 54F of the Act on two flats. Further the ld Assessing Officer had taken full value of consideration on the basis of DVO s report U/s 50C at ₹ 62,63,250/- as argued by the ld AR that the Hon ble Jaipur Bench of ITAT in the case of Nand Lal Sharma Vs. ITO in ITA No. 413/JP/2012 order dated 15/05/2015 has held that while computing the exemption U/s 54 actual sale consideration is to be taken and not as per stamp duty valuation U/s 50C. He also placed reliance of various decisions. Therefore, we have also considered view that for deduction U/s 54, the sale consideration is to be taken on the basis of actual sale consideration received by the assessee not determined by the stamp authority for the registration purposes or determined by the DVO referred U/s 50C of the Act. Accordingly, we partly allow the assessee s appeal as observed above. 7. In the result, appeal of assessee is partly allowed. Order ..... 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