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TMI Blog2019 (5) TMI 1128X X X X Extracts X X X X X X X X Extracts X X X X ..... to stock in trade on 01-04-2012. It is thus seen that both the values do not represent the FMV of the property on the date of conversion. FMV of the property on the date of conversion needs to be determined afresh on a rational basis. Set aside the impugned orders and remit the matter to the AO for making a reference to the Departmental Valuation Officer (DVO) for a fresh determination of the FMV of the property as on 01-04-2012, after entertaining objections, if any, from the assesses and then proceeding accordingly. Unexplained investment - AR contended that the assessee were not given proper opportunity to explain their position regarding the source of investments in the bank accounts - HELD THAT:- Without commenting on the merits, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apital account. The Assessing Officer (AO) observed that the assessee and other co-owners entered into a development agreement with M/s. Gauri Space Creator. Copies of development agreement and supplementary development agreement were filed. It is undisputed that no actual transfer of the land took place during the year under consideration. In order to ascertain the `fair market value (FMV) of the property as on 01-04-2012, the AO issued summons u/s.131 to the Registered valuer who had carried out the valuation of the property and determined the FMV at ₹ 24.24 crore. The Registered valuer expressed his inability to attend the AO s office due to advanced age and health issues. The AO observed that there was huge differe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of conversion. The taxable event would arise only on the actual transfer of the property, which event took place in a later year and not in the year under consideration. Section 45 deals with income chargeable under the head `Capital gains . Sub-section (2) of section 45 provides that : `Notwithstanding anything contained in sub-section (1), the profits or gains arising from the transfer by way of conversion by the owner of a capital asset into, or its treatment by him as stock-in-trade of a business carried on by him shall be chargeable to income-tax as his income of the previous year in which such stock-in-trade is sold or otherwise transferred by him and, for the purposes of section 48, the fair market value of the asset on the date of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ue of the asset as on the date of the conversion. Whereas the assessees adopted the FMV of the asset at ₹ 24.24 crore on the basis of report of a Registered valuer, the AO considered a sum of ₹ 8.41 crore as the FMV on the date of conversion on the basis of stamp value. I have gone through the report of the Registered valuer, a copy of which is available in the paper book. The Registered valuer has admitted on page 6 of his report that in order to ascertain the rates prevalent in the year 2012, a search at the Sub-registrar s office was carried out for obtaining registered value of the properties in the vicinity but the efforts did not yield any suitable results . Thereafter, he proceeded to determine the FMV at ₹ 24.24 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said amount of ₹ 20.00 lakh was given by the other family members out of sale proceeds of certain shops and also other sources of income. 8. Mrs. Chandrakala Vilas Dere, the assessee in ITA No.1415/PUN/2018 deposited a sum of ₹ 9,50,000/- in her bank account. On being called upon to substantiate the source of investment, she also gave a similar reply as that given by Shri Ramesh S. Dere. The AO added both the amounts, which additions came to be affirmed in the first appeals. 9. I have heard both the sides and gone through the relevant material on record. The ld. AR contended that the assessees were not given proper opportunity to explain their position regarding the source of investments in the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X
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