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TMI Blog2022 (4) TMI 450X X X X Extracts X X X X X X X X Extracts X X X X ..... ion report of the Registered Valuer as the said report representing experts opinion on the technical issue of valuation was available on record. Ground Nos. 1 2 of the Revenue s appeal are accordingly dismissed. Deduction u/s 54B - As from the perusal of the agreement to sale, final sale/conveyance deed was to be executed within three months which was done on 13.06.2011 and the sale proceeds had also been received by the assessee substantially at the time of execution of agreement to sale which were duly invested by the assessee in the purchase of new agricultural lands. These findings of facts recorded by the learned CIT(A) in his impugned order clearly show that there was a transfer of original asset, i.e. old agricultural land, by the assessee on 11.04.2011 itself on execution of agreement to sale coupled with possession within the meaning of Section 2(47)(v) of the Income-tax Act, 1961 read with Section 53A of the Transfer of Property Act, 1882; and the assessee having purchased the new agricultural lands within the specified period after the date of the said transfer was entitled to claim deduction under Section 54B of the Act. At the time of hearing before us, learned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... VO, Ahmedabad under section 55A of the Act for estimating the fair market value of the property as on 01.04.1981. The DVO, vide his report dated 16.03.2015, determined the fair market value of the land as on 01.04.1981 at ₹ 89,171/-. When the said report was confronted by the Assessing Officer to the assessee, the later raised various objections. The Assessing Officer, however, overruled the said objections raised by the assessee for the detailed reasons given in his order and proceeded to adopt the value of ₹ 89,171/-, as determined by the DVO, of the land of the assessee as on 01.04.1981 for computing the Long Term Capital Gain chargeable to tax in the hands of the assessee. 4. The action of the Assessing Officer in adopting the fair market value of the land as on 01.04.1981 at ₹ 89,171/- as against ₹ 32,22,240/- on the basis of the DVO s report was challenged by the assessee in appeal before the learned CIT(A) and after considering the submissions made by the assessee as well as the material available on record, the learned CIT(A) held that the reference made by the Assessing Offer to the DVO for valuation of the land as on 01.04.1981 was not valid a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding of the above provision, it is crystal clear that A.O. has power to refer the FMV to DVO in the situation of FMV claimed by the appellant is in accordance with the estimate made by a report of the registered valuer, if an only if, A.O. is of opinion that the value so claimed by the appellant is less than its market value and not vice versa. So, in the present case, I am afraid that the A.O. has power, or jurisdiction to refer the case to DVO. The appellant has also filed a rebuttal to the show cause issued by AO and relied on many case laws as can be seen from No.7 of assessment order. I rely on the ratio laid down in following case laws:- i) CIT Vs Manjulaben N. Unadkat-Appeal No.167/2003(Guj.) ii) Hiraben Jayantilal Shah Vs. ITO ANR 310 ITR 31 (Guj.). iii) M.V. Shah O/L Anant Mills Ltd. Vs. UJ Matain AN₹ 209 ITR 568(Guj.) In view of facts on record and ratio laid down by jurisdictional High Court, reference to the Valuation Officer itself is not as per provisions of the IT Act 1961. The fact remains that there is no alternative to the valuation report from Registered Valuer filed by the appellant and the explanation for admitting t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contrary, to all actions after the date they come into force even though the actions may have begun earlier and the claim on which the action may be based may be of an anterior date. In this regard, it is observed that a similar contention was raised on behalf of the Revenue before the Co-ordinate Bench of this Tribunal at Surat in the case of Shri Mahdevbhai Mohanbhai Naik (ITA No.820/AHD/2016 dated 11.07.2018, AY 2010-11), but the same was rejected by the Tribunal vide paragraph no.12 of its order which reads as under: 12. Thus, the contention of the Learned Departmental Representative that reference was made after 01.07.2012 is not tenable in law as the amendment made in section is substantive in nature which is relevant to assessment year commencing after the date of amendment i.e. F.Y. 2012-13 relevant to A.Y. 2013-14, hence, it is not applicable for the assessment year 2010-11, as the assessment involved is prior to period of 01.07.2012, In view of these facts and circumstances, we are of the considered opinion that the law has been settled by the decision of Hon ble Bombay High Court, Hon ble Gujarat High Court, Mumbai Tribunal and Pune Tribunal. Therefore, the AO was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that his old agricultural land was transferred by him on 11.04.2011 itself within the meaning of Section 2(47)(v) of the Act since banakhat (agreement to sale) was executed on 11.04.2011 and the possession of the land was also given on the same date. It was also explained by the assessee that the sale proceeds of old agricultural land were received by him on 09.05.2011 which were utilized for purchase of new agricultural lands. This explanation offered by the assessee was not found acceptable by the Assessing Officer. According to him, banakhat (agreement to sale) executed by the assessee on 11.04.2011, by itself, did not create any interest in or charge on the old agricultural land and there was thus no transfer of the said land by the assessee on that date. He held that the deed of conveyance/sale deed of the old agricultural land was executed and registered by the assessee and his wife on 13.06.2011; and, the said land was thus transferred only on that date within the meaning of Section 2(47)(v) of the Act. He accordingly held that the assessee was not entitled for deduction under Section 54B of the Act in respect of new agricultural lands purchased prior to the date of transfer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ................... (v) any transaction involving the allowing of the possession of any immovable property to be taken or retained in part performance of a contract of the nature referred to in section 53A of the Transfer of Property. Act, 1882 (4 of 1882); or ....... The agreement to sale the original land (survey No.24: Gota Village, Daskoi Taluka) dated 11.04.2011 (PB-55-62) by the appellant is on record. The clause No. 10 (PB-61) of this agreement to sale indicates that the final deed to be executed within three months. Consequently, final agreement to sale of original land is registered on 13.06.2011. The act of appellant is natural and no mens-rea involved. The sale proceeds have been received and accounted in the books of account as per para 23 of statement of facts, are as under:- Date of the Cheque Cheque No. Credited in Bank Account Amount Remark 01/04/2011 000027 09/05/2011 35,00,000/- At the time of handing over the possession 05/04/20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 0,000 26/05/2011 Survey No. 816, Block No. 53, Village Chekhla 23,83,335 25/05/2011 Survey No. 816, Block No.53, Village Chekhla 23,83,333 26/05/2011 Survey No, 816, Block No. 53, Village Chekhla 23,83,333 26/05/2011 Survey No. 816, Block No. 53, Village Chekhla 96,50,001 As it can be seen above, the appellant had invested the received funds to Purchase New Agricultural lands. I find that From No. 12 from Accounting Year 2005-2006 to accounting Year 2011-2012 (PB-51-52) which shows name of the crop, area of crop etc. for the land sold during concerned year has been placed on record by the appellant. In addition to it, Form No. 8A also shows that the said land was used for Agriculture purpose. The AO has gone to the extent of intention to convert the land to Non agriculture (NA) which is not at all the requirement of Law to claim deduction u/s 54B of the Act, 1961. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Detail of Land 7,50,000 18.05.2011 Kalol Survey No.97 7,50,000 09.05.2011 Kaloi Survey No.97 23,83,335 25.05.2011 Survey No. 816, Block No. 53, Village Chekhla 23,83,333 26.05.2011 Survey No. 816, Block No. 53, Village Chekhla 23,83,333 26.05.2011 Survey No. 816, Block No. 53, Village Chekhla 86,50,005 The appellant fulfilled all the conditions laid down to claim deduction as per provisions of section 54B of IT Act, 1961. It is also decided that deduction u/s.54B is allowable to appellant for investment of ₹ 86,50,005/- (shown as ₹ 92,50,000/- in statement of income but makes no difference in liability as the new investment is of ₹ 86,50,005/- against the LTCG of ₹ 22,05,090/-) in new agricultural land against the LTCG arisin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der:- Section 53A in The Transfer of Property Act, 1882 1[53A. Part performance.-Where any person contracts to transfer for consideration any immoveable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty, and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then, notwithstanding that 2[*] where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract: Provided that nothing in th ..... 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