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TMI Blog2022 (1) TMI 1102X X X X Extracts X X X X X X X X Extracts X X X X ..... permit the authority to find out the fair market value of the property outside of the sale. Also in RANCHODBHAI C. PATEL [ 2020 (12) TMI 171 - ITAT AHMEDABAD] held that where in case of immovable property sold by the assessee determined by Valuation Officer lesser than value declared by the assessee as on 01.04.1981, in that case reference to the Valuation Officer under s.55A of the Act was not warranted and it was also mentioned that amendment brought in Section 55A of the Act w.e.f. 01.07.2012 by Finance Act, 2012, according to which, reference could be made by the AO to D.V.O. if value of immovable property determined by assessee was lesser than fair market value of property, is applicable prospectively and not retrospectively. As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2010-11. The amendment in section 55A(a) of the Act enabling the Assessing Officer to refer the matter to Valuation Officer for the value as on 01.04.81 has been introduced w.e.f. 01.07.12 i.e. after Asst. Year 2010-11. 2. The Learned Commissioner of Income Tax (Appeals)-5, Ahmedabad has erred in confirming the sale consideration at ₹ 44,01,000/- as per the valuation report instead of ₹ 41,00,000/- shown by the Appellant. 3. The Learned Commissioner of Income Tax (Appeals)-5, Ahmedabad has further erred in confirming the taxable Long Term Capital Gain at ₹ 8,87,000/- instead of Long Term Capital Loss of ₹ 33,25,159/- shown by the Appellant in the return of income, relying on valuation report dated 28.05.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee and ₹ 44,01,000/- as on 06.05.2009 as against ₹ 75,00,000/- declared by the stamp valuation authority. Accordingly, the AO issued show cause notice to the assessee. In response to the show cause notice, the assessee filed his reply and the reply was not accepted by the AO and recomputed the long term capital gain at ₹ 8,87,080/- and made the addition. 4. Thereafter, the assessee preferred statutory appeal before the CIT(A). During the course of appellate proceedings, the assessee has objected the addition of ₹ 8,87,080/- made by the A.O. During the course of appellate proceedings, the assessee has submitted that as per the Government valuer of Income-tax Department value of the said property calculated at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (ii) that having regard to the nature of the asset and other relevant circumstances, it is necessary so to do, and where any such reference is made, the provisions of sub-sections (2), (3), (4), (5) and (6) of section 16A, clauses (ha) and (i) of sub-section (1) and sub-sections (3A) and (4) of section 23, sub-section (5) of section 24, section 34AA, section 35 and section 37 of the Wealth-tax Act, 1957 (27 of 1957), shall with the necessary modifications, apply in relation to such reference as they apply in relation to a reference made by the [Assessing] Officer under sub-section (1) of section 16A of that Act. Explanation-In this section, Valuation Officer has the same meaning, as in clause (r) of section 2 of the Wealth-tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ending on date of making reference, reference was bad, in law; and that section 55A did not permit the authority to find out the fair market value of the property on the date of the sale. 5.2 The learned AR also cited an order of Surat Bench in the matter of Ranchodbhai C. Patel vs. ITO [2021] 123 taxmann.com 215 (Surat-Trib.) , wherein it is held that where in case of immovable property sold by the assessee determined by Valuation Officer lesser than value declared by the assessee as on 01.04.1981, in that case reference to the Valuation Officer under s.55A of the Act was not warranted and it was also mentioned that amendment brought in Section 55A of the Act w.e.f. 01.07.2012 by Finance Act, 2012, according to which, reference could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... VO only if value declared by assessee is in opinion of Assessing Officer less than its fair market value - Held, yes - Whether when value of property adopted by assessee was much more than fair market value even as determined by Departmental Valuation Officer, invocation of section 55A(a) was not justified - Held, yes - Whether in face of clear position in law, CBDT circular dated 25-11-1972 can have no application as understanding of statutory provisions by revenue as found in circular issued by CBDT is not binding upon assessee and it is open to an assessee to contend to contrary - Held, yes [Paras 7,10] [In favour of assessee] Respectfully following the judgment of High Court order and in parity with the order of ITAT, Surat Bench, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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