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TMI Blog2021 (6) TMI 340X X X X Extracts X X X X X X X X Extracts X X X X ..... ncy rights , dated 17.09.2013) and the fair market value of such tenancy rights determined by the District Valuation Officer-II, Mumbai vide his order passed u/s 55A Of the Act, dated 01.06.2017 worked out at a marginal figure of 2.81%, the CIT(A) had rightly directed the A.O to accept the sale consideration reflected by the assessee, as such. Accordingly, concurring with the well reasoned view taken by the CIT(A), we uphold the same. Appeal filed by the revenue is dismissed. - ITA No.721/MUM/2019 - - - Dated:- 25-2-2021 - Shri M. Balaganesh (Accountant Member) And Shri Ravish Sood (Judicial Member) For the Assessee : Shri Hiro Rai, A.R For the Revenue : Ms. Shreekala Pardeshi, D.R ORDER PER RAVISH SOOD, J.M: The present appeal filed by the revenue is directed against the order passed by the CIT(A), 58, Mumbai, dated 30.11.2018, which in turn arises from the assessment order passed by the A.O under Sec. 143(3) of the Income Tax Act, 1961 (for short Act‟), dated 29.12.2016 for A.Y. 2014-15. The revenue has assailed the impugned order on the following grounds of appeal before us: 1 On facts and in the circumstances of the case and in law, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had taken the sale consideration as per the agreement and not the market value that was adopted by the Stamp Valuation Authority for the purpose of registration of the transfer deed, the A.O called upon him to explain as to why the LTCG may not be recalculated as per Sec. 50C of the Act by taking the value adopted by the Stamp Valuation Authority i.e ₹ 13,07,25,000/- as the deemed sale consideration. In reply, it was submitted by the assessee that as it had transferred the tenancy rights of the aforesaid property, viz. Flat at Shakuntala, Worli CPhase, Mumbai and not the ownership rights therefore, the value arrived at for the purpose of stamp duty i.e ₹ 13.07 crore which was the value of ownership rights of the property could not be adopted as the sale consideration as regards the transaction of transfer of tenancy rights. In fact, it was submitted by the assessee that considering the market value of the property a/w the fact that it was an old property, the value of the tenancy rights worked out at ₹ 3,88,20,739/- which was lower than the consideration of ₹ 5,05,00,000/- for which the same had been transferred. In the backdrop of the aforesaid facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty in question was determined at ₹ 5,19,20,500/-, as against the value declared by the assessee at ₹ 5,05,00,000/- (i.e as per the deed for transfer of tenancy rights ). Observing, that the difference between the actual consideration and the value determined by the valuation officer was 2.81% (approx.), the CIT(A) holding a conviction that as the aforesaid variance was well within the tolerable limit of deviation thus, observed that no cognizance of the said marginal difference was liable to be drawn. At this stage, we may herein observe that the CIT(A) while disposing off the appeal had refrained from adverting to and therein dealing with the issue as to whether the tenancy rights in perpetuity would fall within the realm of Sec. 50C of the Act, or not. Backed by his aforesaid deliberations, the CIT(A) taking cognizance of the fact that the valuation of the tenancy rights of the property in question fairly matched with that reflected by the assessee thus, directed the A.O to adopt the figure as disclosed by the assessee after ignoring the marginal difference of 2.81%. Accordingly, the appeal filed by the assessee was allowed by the first appellate authority. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tedly had proceeded with and framed the assessment in the backdrop of the fact that the assessee had transferred a tenancy right in the property in question. Our aforesaid conviction is fortified from the very fact that even while making a reference to the District Valuation Officer-II, Mumbai the A.O had sought his indulgence for valuation of the tenancy rights of the property in question. Backed by the aforesaid factual position, we are unable to accept the claim of the ld. D.R, wherein she had tried to build up a new case and therein impress upon us that the A.O had made a reference to the District Valuation Officer-II, Mumbai for valuing of the ownership rights of the property in question and not the tenancy rights . As observed by us hereinabove, though the A.O had not doubted the substance of the transfer transaction in question i.e transfer of tenancy rights by the assessee, but he was of the view that holding of tenancy rights in perpetuity was akin to ownership rights. As such, it is the dichotomy that had resulted pursuant to usage of the term ownership rights vis-avis tenancy rights by the A.O that had led to a misconception as regards the issue in question ..... X X X X Extracts X X X X X X X X Extracts X X X X
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