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TMI Blog2018 (4) TMI 1517X X X X Extracts X X X X X X X X Extracts X X X X ..... in the argument of the assessee and we hold that the Pr.CIT has rightly rejected the submission made by the assessee. As gone through the assessment order and observed that though the AO has examined the computation of short term capital gains, the AO has not examined the issue with regard to the stamp duty value assessed by the Sub Registrar Office and applicability of provisions of Section 50C of I.T.Act. In this case, the assessee has transferred the land for development and the registering authority has assessed the value of the land at ₹ 3,90,58,800/-. The assessee has not disputed the stamp duty value fixed by the Registering authorities. This issue was not examined by the AO and the assessment order is completely silent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AO, JUDICIAL MEMBER AND SHRI D.S. SUNDER SINGH, ACCOUNTANT MEMBER For The Appellant : Shri C.V.S.Murthy, AR For The Respondent : Smt.V.Madhuvani, DR ORDER PER D.S. SUNDER SINGH, Accountant Member: This appeal is filed by the assessee against the order of the Pr.Commissioner of Income-Tax [Pr.CIT], Visakhapatnam vide ITANo.Pr.CIT-1/VSP/263/3/2015-16 dated 29.03.2016 for the assessment year 2011-12. 2. All the grounds of appeal raised by the assessee are against the order passed by the Pr.CIT u/s 263 of I.T.Act. In this case, the assessee filed return of income declaring total income of ₹ 3,36,57,320/- and the assessment was completed u/s 143(3) of the I.T.Act accepting the income returned. Subsequen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ause notice dated 30.09.2015 directing the assessee to explain as to why the assessment order u/s 143(3) should not be revised u/s 263 of the Act. In response to the show cause notice, the assessee explained before the Pr.CIT that the assessee owned total extent of 26.90 acres of agricultural land, which was given for development to the developer towards the development charges for the development of the land. The land admeasuring 13.45 acres was given to the developer as development charges and the balance land of 13.45 acres was retained by the assessee. As per the understanding between the assessee and the developer, the cost of the development would be the market value 13.45 acres of land which was ₹ 4 lakhs per acre at the time o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee before the Pr.CIT was that the assessment was completed u/s 143(3) and the AO has made the discussion in the assessment order with regard to the short term capital gains and hence the same examined by the AO. Since the AO has examined the issue and taken a conscious decision there is no error in the assessment order which is prejudicial to the interest of the revenue, hence requested the Pr.CIT to drop the 263 proceedings. 3. The Ld.Pr.CIT examined the submission of the assessee. Not being convinced with the explanation of the assessee held that the assessment order passed by the Assessing Officer u/s 143(3) is erroneous and prejudicial to the interest of the revenue and directed the AO to modify the order passed u/s 143(3)adopting th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registrar office. Therefore, there is no merit in the argument of the assessee and we hold that the Pr.CIT has rightly rejected the submission made by the assesse. 6. The next argument of the assessee was that the AO has completed the assessment u/s 143(3) and during the course of assessment proceedings, the AO has examined the short term capital gains, hence argued that the issue with regard to the computation of capital gains was examined by the AO, hence, there is no case for invoking the jurisdiction u/s 263 by the Pr.CIT. We have carefully gone through the assessment order and observed that though the AO has examined the computation of short term capital gains, the AO has not examined the issue with regard to the stamp duty value a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld.Pr.CIT. Though the assessee has transferred the undeveloped land and the developer has given physical possession of the developed plots as per the development agreement dated 28.06.2010, the fact remains that the assessee had retained 50% of the land and only 50% of the land was transferred to the developer, therefore, we are of the considered view that the capital gains has to be computed on 50% of the land transferred to the developer, but not on the entire developed land as contended by the Ld.Pr.CIT. However, the issue needs to be verified by properly examining the development agreement with regard to the transfer of land and retention of the land by the assessee and capital gains required to be taxed on that part of the land wh ..... X X X X Extracts X X X X X X X X Extracts X X X X
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