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TMI Blog2019 (12) TMI 1200X X X X Extracts X X X X X X X X Extracts X X X X ..... Income Tax Act,1961 (in short 'the Act') by the Income Tax Officer- Ward-4(3) Amritsar, (in short "the AO"). 2. Ground No.1 is against the issue of notice under section 148 of the Act that the notice is void-ab-initio. 3. We have perused the relevant material on record. We find that the impugned assessment order was passed in while giving appeal effect to the order of I.T.A.T. Amritsar. The learned Counsel for the assessee has also not made any argument on this ground before us. Therefore, this ground of appeal is dismissed. 4. Ground No. 2 to 4 are against the addition of Rs. 12,21,940 on account of long-term capital gain on sale of properties. 5. Succinct facts are that the assessee has filed return of income on 10.07.2003 declaring ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to be sold to them. The matter for valuation of the properties should have been adopted as Rent Capitalization Method. It was further contended that the Valuation Officer has provided depreciation 90% of cost as against 95% of cost and has taken the life of the building is 70 years instead of 60 years. The assessee further contended that the Rent Capitalization Method was accepted by the Legislature by in enacting Rule1BB (operative up to 31. 03. 1989) and Rule 3 of Schedule III of Wealth Tax Act (after 01.04.1989). The assessee has also placed reliance on various case laws as quoted by the AO at Page No.3 of assessment order. However, the AO observed that the Rent Capitalization Method is applicable to wealth tax purpose only. The asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the same manner as they apply to valuation referred under Wealth Tax Act. The Rule 3 of Schedule III of Wealth Tax Rules specifically provide for method of valuation of rented building as Rent Capitalization Method. The submissions of Valuation Officer that Directorate of Income tax issued guidelines, however same cannot be overruled out the provisions of the Act. The learned counsel for the assessee further supported his view by placing reliance in the case of CIT v. Pramod Chand Soni 100 CCH 0333 (Raj.),Waqf Alal Aulad v. Addl. CIT 28 CCH 0712 (Delhi-Trib) and plethora of decision as per his case laws book which were also quoted by the AO in his assessment order. It was further contended that CPWD rate are applicable in New Delhi whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an assessee of a capital assets, being land or building or both, is less than the value adopted by any authority of a State Government for the purpose of payment of stamp duty in respect of such transfer, then the value so adopted would be deemed to be full value of the consideration received or accruing, as a result of such transfer, for computing capital gain/loss of the assessee. However, the assessee may dispute the adoption of such value and in that case, a reference would be made to VO as per sub-section (2) of section 50C. In the present case, according to section 50C, the reference to VO was made at the instance of Tribunal. The two properties in question were valued on the basis Land & Building Method. However, we notice that the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the case of CIT v. Pramod Chand Soni 100 CCH 0333 (Raj.) held that where properties are rented for more than 50 years and was in possession of tenants at the time of execution of sale deed hence, it could be reasonably inferred that such property could not fetch prevalent market rate as compared to other properties. Similarly in the case of Ramendra Vikram Singh v. ITO 36 DTR (luck) (Trib) 129 it was held that DVO report under section 50C (2) is binding on the AO and it was also held that Section 16A of Wealth Tax Act read with Rule and Schedule III of Wealth Tax Act are applicable to the valuation made under section 50C of the Act. Similar findings were given by the Hon`ble Punjab & Haryana High Court in the case of CIT v. Prem Nath A ..... X X X X Extracts X X X X X X X X Extracts X X X X
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