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TMI Blog2019 (7) TMI 852X X X X Extracts X X X X X X X X Extracts X X X X ..... rket value of the property whereas the fact remains that the property is a residential area but is being used for commercial purpose. Thus applying the commercial rates on a residential property used for commercial purpose is not proper and justified. Determination of the fair market value by the DVO requires a fresh look based on the prevailing fair market price well as comparable sale instance. Since, the assessee has now filed the site plan as additional evidence, therefore, in the facts and circumstances of the case we set aside this issue of fair market value to the record of the DVO/AO for redetermination of the same as per above observations. It is also pertinent to note that for the purpose of computing the cost of construction the state PWD rates shall be applied as against CPWD rates as the property is situated in the jurisdiction of State PWD and not in the jurisdiction of CPWD. Hence, the DVO is directed to reconsider the determination of fair market value and after giving an opportunity of hearing to the assessee. Determination of cost of acquisition of the property on 01.04.1981 - HELD THAT:- DVO has taken the fair market value as on 01.04.1981 by considering ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ord, we find that the assessee has explained the cause of delay as the mother of the assessee was not well and was hospitalized on 28.07.2017. Further, the mother of the assessee died on 05.09.2017. The assessee has produced the medical record of the ailing mother and therefore, the reasons explained by the assessee are found to be reasonable for delay in filing the present appeal. Hence, we are satisfied with the cause of delay explained by the assessee being reasonable and accordingly the delay of 51 days in filing the present appeal is condoned. 6. The assessee has raised the following grounds:- 1.(a) In the facts and circumstances of the case and in law the ld. CIT(A) has erred in confirming the action of the ld. AO in confirming addition of Long Term Capital Gain at ₹ 1,72,84,490 as against the addition of ₹ 2,10,88,170 made by ld. AO. The action of the ld. CIT(A) is illegal, unjustified, arbitrary and against the facts of the case. Relief may please be granted by deleting the said addition of ₹ 1,72,84,490. (b) In the facts and circumstances of the case and in law the ld. CIT(A) has erred in con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as not pressed. The ld. DR has raised no objection if ground no. 1(c) of the assessee s appeal is dismissed as not pressed. Accordingly the ground no. 1(c) of the assessee s appeal is dismissed being not pressed. 8. Ground Nos. 1(a) (b) and (d) are regarding the addition made by the AO on account of long term capital gain by adopting the full value consideration as per the provisions of Section 50C of the IT Act at ₹ 2,61,53,980/- as against sale consideration of ₹ 1,55,00,000/-. The assessee is an individual and proprietor of M/s Trading Corporation and e-filed his return of income on 13.10.2010 declaring total income of ₹ 3,75,690/-. In the scrutiny assessment, the AO noted that the assessee has sold some portion of building D-38A, Ashoka Marg, Ahinsha Circle, Jaipur for a consideration of ₹ 1,55,00,000/- and the stamp duty value of the same was taken at ₹ 1,55,53,414/- at the time of sale deed dated 09.12.2009. Subsequently, the AO found that as per ITS information the value of the property sold by the assessee was determined by Sub-registrar, Sanganer, Jaipur at ₹ 2,61,53,980. In order to verify the correct status of the value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n be valued as a residential property and not commercial. In support of his contention, he has relied upon the decision of Hydrabad Benches of the Tribunal in case of N. Revathi vs. ITO in ITA No. 67/Hyd/2013 and submitted that when the building has been constructed for residential use with all amenities which are necessary for residential accommodation then even if it is used for non residential purpose it would not lose its character as a residential building. Further, the DVO has also computed the value/cost of construction by adopting the CPWD rates whereas the property situated in the State PWD jurisdiction and therefore, State PWD rates ought to have applied. He has relied upon the decision of Hon ble Jurisdictional High Court in case of CIT vs. Dinesh Talwar 265 ITR 344 . The AR has also referred to a show cause notice issued by the Nagar Nigam dated 24.12.2012 against the unauthorized use of property for commercial purpose. He has then referred to the decision of Coordinate Benches dated 27.04.2018 in case of Shri Sunil Jain vs. DCIT in ITA No. 04/JP/2017. Thus, the ld. AR has submitted that the fair market value determined by the DVO by taking commercial rat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n as per record is a residential property however, the location of the property as well as the actual use of the property for commercial purposes has led to the stamp duty authority as well DVO to adopt commercial rates for the purpose of valuation. The stamp duty authority has initially applied the residential rate at the time of sale deeds but subsequently the value was revised by adopting commercial rates. This appears to be based on the actual used of the property in question. Even the assessee has not disputed the actual used of the property as for commercial purpose and due to such unauthorized used the Nagar Nigam issued a show cause issued dated 24.12.2012. The assessee has also filed the sanctioned plan of the property in question as additional evidence in support of the claim that at the time of sale the property was a residential one and subsequent misuse of the same for commercial purpose will not enhance the fair market value. It is pertinent to note that though the locational advantage and actual use of the property for commercial purpose are certainly relevant factors for determining fair market value of the property but this itself will not be a ground to reclassify ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as on 01.04.1981 on the basis of comparable sales but the same was not confronted with the assessee. Even otherwise the sale instances taking into consideration by the DVO are not comparable as there are in respect of area not similar to the property of the assesee. The AO/DVO has also made addition of 50% to the value as it was situated in the corner. All these facts were not confronted with the assessee. 14. On the other hand, the ld. DR has submitted that the DVO has considered all the relevant factors while adopting the fair market value as on 01.04.1981. He has relied upon the order of the authorities below. 15. Having considered the rival submissions as well as relevant material on record we find that the DVO has taken the fair market value as on 01.04.1981 by considering the comparable instances however, the assessee was not confronted with such comparable cases to be adopted by the DVO. Further, the DVO enhanced the value due corner location of the property this was also not confronted with the assessee. Since, the main issue of determining the fair market value as on the date of the sale has been remanded to the DVO/AO, therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X
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