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TMI Blog2020 (10) TMI 563X X X X Extracts X X X X X X X X Extracts X X X X ..... ars in question is a capital asset to which provisions contained u/s 50C are not applicable. Even if for the sake of argument, it is understood to be a new plea, it does not change the complexion of the dispute, inasmuch as the subject matter of the dispute remains to be the efficacy or otherwise of the action of the Assessing Officer of invoking section 50C of the Act. More importantly, it has to be appreciated that the point of law raised by the assessee is competent to be adjudicated, based on the accepted factual position, which is available on record.Report of the DVO dated 21.6.2018 reveals that the nature of property being lease hold , has been specifically noted. Thus, in our considered opinion, there is no merit in the plea of the Ld. C.I.T. DR to prevent the assessee from pursuing the aforesaid argument before us. The defence by the C.I.T. DR, in our view, is misplaced and is hereby negated. We find that the present transaction of six properties in question does not warrant invoking of section 50C(1) of the Act as the property in question is not of the nature covered by section 50C(1) of the Act. Therefore, on this point itself, we set aside the order of the ld. Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0C in spite of the fact that DVO has determined the valuation under section 50C at ₹ 193,56,67,000/-. 7. The Learned CIT(A) has grossly erred on facts as well as in law in rejecting the DVO report on the basis of recommendations of learned assessing officer. 8. The learned CIT(A) has grossly erred on facts as well as in law in rejecting the valuation of approved valuer without assigning any reason. 9. The Ld. CIT(A) has grossly erred on facts as well as in law in confirming the addition without considering the submissions made by the assessee. 10. The Ld.CIT(A) has grossly erred on facts as well as in law in holding that objections are similar to those raised before they learned assessing officer. 11. The Ld. CIT(A) has grossly erred on facts as well as in law in holding that procedure laid down under section 142 A is not applicable to section 50. 3. Although the assessee has preferred multiple Grounds of Appeal, but essentially the solitary grievance raised by the assessee is with regard to invoking of Section 50C of the Act and making an addition of ₹ 240,91,67,743/- to the returned income by the Assessing Officer. 4. Briefly put, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransaction in question by filing copies of the sale deeds; it was asserted that the value adopted by the stamp valuation authority exceeded fair market value of the property on the date of transfer; and, that nothing has been received over and above the stated consideration. The assessee-company also furnished a valuation report from a Registered Valuer in support of its assertions. Apart from other objections, assessee specifically stated that value adopted by the Stamp Valuation Authority could not be taken as the full value of the consideration in terms of section 50C(1) of the Act inasmuch as the value adopted by the stamp valuation authority exceeded the fair market value of the property. The Assessing Officer referred the matter to the Departmental Valuation Officer i..e the DVO for valuation of the property having regard to the provisions of Section 50C(2) of the Act. As the report of the DVO was not received at the time of completion of assessment on 29.12.2017, the Assessing Officer did not accept any of the points raised by the assessee, and, instead, he treated the value assessed by the stamp valuation authority as the full value of consideration, for the purposes of com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the assessee referred to a sample lease deed of one of the properties entered with M/s Hexagon Assets LLP dated 24.2.2015, a copy of which is placed in the Paper Book at pages 91 to 115. It has been explained that the assessee has taken land on lease for a period of 90 years commencing from April 2006 from New Okhla Industrial Development Authority (NOIDA) and constructed Tower C building in question as a Cyber Park out of which a portion has been sub-leased to M/s Hexagon Assets LLP. By referring to the lease deed, it is pointed out that it is a tripartite agreement, whereby NOIDA is the lessor , assessee is the lessee and M/s Hexagon LLP is the sub-lessee . Moreover, it is pointed out that it is not a case of perpetual lease deed, and the Ld. Representative for the assessee emphasized that what has been transacted by the assessee is only lease hold right in the land or building, which is quite distinct from the capital asset referred to in Section 50C(1) of the Act. In support of the proposition that Section 50C does not cover lease rights in land and building or both, reliance has been placed on the following decisions:- i) GVK Industries Ltd. vs ITO (2011) 4SCC36(SC) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both , is less than value adopted by the Stamp Valuation Authority for the purposes of payment of stamp duty, then the value so adopted by the Stamp Valuation Authority be deemed to be the full value of the consideration received or accruing as a result of the transfer for the purposes of computing Capital Gains in the hands of the seller u/s 48 of the Act. Before us, the case sought to be made out by the assessee is that Section 50C, being a deeming provision, has to be strictly interpreted, a proposition which is quite acceptable; and, according to the assessee, Section 50C(1) covers a capital asset being land or building or both whereas in the instant case, what is transacted is merely leasehold rights in land and building, which is a distinct Capital Asset . The distinction sought to be made by the assessee is well-founded, and such distinction can be gauged from the Act itself. In this context, we may refer to section 54D(1) of the Act, whose relevant portion reads as under:- Subject to the provisions of sub-section (2), where the capital gain arises from the tran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by the assessee is directly emanating from the phraseology of section 50C(1) of the Act itself; and, therefore, it cannot be construed to be an issue which was not the subject matter of consideration by the lower authorities. Evidently, Section 50C has been the bone of contention between both the assessee and the Revenue right from the stage of assessment. However, even if for the sake of argument, it is understood to be a new plea, it does not change the complexion of the dispute, inasmuch as the subject matter of the dispute remains to be the efficacy or otherwise of the action of the Assessing Officer of invoking section 50C of the Act. More importantly, it has to be appreciated that the point of law raised by the assessee is competent to be adjudicated, based on the accepted factual position, which is available on record. In fact, we find that copies of the sale deed/ tripartite lease deed were furnished before the Assessing Officer and the communication of the Assessing Officer to the DVO dated 27.12.2017, a copy of which is placed at page 26 to 28 of the Paper Book reveals that the same has been forwarded by him to the DVO. In fact, the report of the DVO dated 21.6.2018 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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