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TMI Blog2017 (3) TMI 1182X X X X Extracts X X X X X X X X Extracts X X X X ..... . In our view, order of assessment passed by A.O. was clearly erroneous and also prejudicial to the interest of Revenue. Tribunal has dealt in detail, various inquires made by A.O. with regard to valuation of property but the basic fact regarding nature of land which was relevant for determination of fair market value was erroneous and has not been examined at all. The Assessee himself knew that the land was within the municipal limits of Nagar Nigam, therefore, fair market value mentioned in the sale deed was not taken by it, which was applicable to an agricultural land but Assessee admittedly applied the circle rate applicable to urban land. The land which was within the municipal limits, could not have been treated to be ''agricultur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent Year(hereinafter referred to as ''A.Y.') 2004-05. 4. It was admitted on the following two substantial questions of law: I. Under the facts and circumstances of the case, the learned Income Tax Appellate Tribunal has erred in law in quashing the order of the Commissioner of Income Tax u/s 263 without appreciating that the assessment order was both erroneous and prejudicial to the interest of revenue, as the assessment order was passed without proper inquires, without appreciating facts properly and without application of mind on various issues. II. Under the facts and circumstances of the case, the learned Income Tax Appellate Tribunal has erred in law in quashing the order of the Commissioner of Income Tax u/s 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued notice dated 20.03.2009 initiating proceedings under Section 263 of the Act, 1961 and stated therein that Assessee had sold a piece of land to M/s. Omaxe Properties Ltd. during relevant A.Y. It has shown sale consideration at ₹ 60,00,000/- for the purpose of computing capital gains and accordingly worked out long term loss of ₹ 7,85,312/-. A.O. accepted aforesaid sale consideration/ value of land, without importing Section 50C of Act, 1961, which says, if consideration received or accrued as a result of transfer by an Assessee of a capital asset of a land or building, is less than the value adopted or assessed by any authority of State Government for the purpose of payment of stamp duty in respect of such transfer, the value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .T. found that in the order passed by A.O., all the details and factum regarding valuation of D.V.O. were not mentioned. The order is cryptic and stereotyped. Thus, it cannot be said that A.O. made detailed inquiry in the claim of capital loss made by Assessee. C.I.T. also held that A.O. did not make any attempt to verify veracity or otherwise of evidence available on record and there was a complete failure on the part of A.O. to make necessary inquiry. Tribunal has found that A.O. made reference to D.V.O. which shows that in his view some numbers shown by Assessee, present valuation of stamp duty was not justified. D.V.O. worked out fair market value at ₹ 59.30 lacs. A.O. asked D.V.O. to reconsider his decision but D.V.O. still too r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not material available before A.O. or C.I.T. 17. From the order of Tribunal, we find that various letters and notices sent by A.O. and D.V.O. have been quoted in extentio. It shows that D.V.O. in his report remarked that valuation unit of department has no provision to value agricultural land as per statutory provisions, hence D.V.O. did not determine fair market value of property and sought for the direction, again it was required to provide fair market value of the property sold by Assessee. 18. The confidential letter dated 12/13.09.2006 of Shri N. K. Gupta, D.V.O. is also reproduced in the order of Tribunal which shows that D.V.O. determined value treating as agricultural land and for that purpose referred to page Nos. 7 and 26 o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... D.V.O. sent letter dated 20.02.2007 addressed to Additional Commissioner of Income Tax, Lucknow, that A.O., if wants to stay on its own interpretation of law he can proceed. The tone of letter is aveiled threat to A.O. 22. It is true that A.O. made reference to D.V.O. for valuation of land in dispute under Section 50C(2) of the Act, 1961, but D.V.O. examined the matter erroneously by taking nature of land as agricultural, ignoring that in the sale deed itself it was also mentioned that land was within limits of Nagar Nigam and that being so, its value ought to have been examined as an urban land and not agricultural land. A.O. treated estimation of D.V.O. as final and proceeded accordingly. In our view, order of assessment passed by A.O ..... X X X X Extracts X X X X X X X X Extracts X X X X
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