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TMI Blog2023 (3) TMI 820X X X X Extracts X X X X X X X X Extracts X X X X ..... ort of DVO determining fair market value of the land in question - HELD THAT:- The assessee has sold agricultural land and, therefore, the same cannot be termed as capital asset and will not come under the purview of Section 50C - reference to DVO by adopting Fair market Value was not justified in the present case as the said report whether has taken the aspect of Sale Deed of agricultural land or not has not been pointed out by the AO. In the present case, the addition in respect of Section 50C is not justifiable since the agricultural land sale was executed on 27.09.2010 at the prevailing Jantri Rate. The registration of the sale deed was after the addition/contractual obligation relating to agricultural land converting into non-agricu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment Order which was passed despite pendency of report from DVO u/s.50C of the Act. 5. The learned CIT(A) has erred both in law and on the facts of the case in confirming the adoption of Rs.45,72,000/- as the value of the land as against actual sale consideration of Rs.7,73,020/- and the consequent addition u/s.50C of the Act. 6. Alternatively and without prejudice, the market value as on the date of agreement to sell should be adopted u/s.50C of the Act. 7. Alternatively and without prejudice, the learned CIT(A) erred both in law and on the facts of the case in not appreciating that AO erroneously did not deduct sale consideration of Rs.7,73,020/- while revising assessed income at the time of rectification u/s.154 of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y on 05.06.2014. Thereafter, the case was selected for compulsory scrutiny and statutory notice under Section 143(2) of the Act alongwith reasons for reopening of the case. The assessee filed submissions before the Assessing Officer which was taken on record and the Assessing Officer made addition of Rs.55,65,565/- as Long Term Capital Gain (LTCG) under Section 50C of the Act. 4. Being aggrieved by the Assessment Order, the assessee filed appeal before the CIT(A). The CIT(A) dismissed the appeal of the assessee. 5. As regards to ground no.1 relating to reopening under Section 147 of the Act, the Ld. AR submitted that reopening was only on the ground of stamp valuation of the land in question is higher than the consideration appearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llage Nesda which is located at a distance of almost 19 kilometres from Bhavnagar which is nearest Municipality. The land in question is undoubtedly situated beyond 8 kilometres from the local limits of Municipality. Further, the revenue records being 7/12 and 8/A extracts reveal that the land in question was used for cultivation of cotton. Thus, the land in question was agricultural land and accordingly, it was outside the ambit of capital asset, as defined under Section 2(14) of the Act. The Ld. AR relied upon the decision of CIT vs. Smt. Sanjeeda Begum (2006) 154 Taxman 346 (Allahabad). AR further submitted that agreement to sell in respect of the land in question was entered into and one of the conditions mentioned therein was the land ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vailing Jantri Rates. These facts were undisputed by the revenue as per the proviso to Section 50C inserted by the Finance Act, 2016 where the date of agreement fixing the amount of consideration and the date of registration for transfer of capital asset are not the same, value adopted or assessed or assessable by stamp valuation authority on the date of agreement may be taken for computing full value of consideration. The Ld. AR relied upon the decision of Ahmedabad Tribunal in case of Dharamshibhai Sonani vs. ACIT (2016) 161 ITD 627 (Ahmedabad) which was followed in ACIT vs. Bimladevi Agarwal (ITA No.130/Ahd/2017) and ITO vs. Kanubhai N. Patel (ITA No.527/Ahd/2017). Since agreement to sale was executed at the prevailing Jantri Rates, no a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est was to be received after the conversion of the said land into non-agricultural use. The conversion expenses from agricultural land to non-agricultural land were to be borne by the buyer M/s. Inducto Cast Private Limited. Final registered Sale Deed was executed on 11.10.2011 but the original Banakat Sale Deed was dated 27.09.2010 at the Jantri rate prevailing at that point of time. The assessee has sold agricultural land and, therefore, the same cannot be termed as capital asset and will not come under the purview of Section 50C of the Act. The reference to DVO by adopting Fair market Value was not justified in the present case as the said report whether has taken the aspect of Sale Deed of agricultural land or not has not been pointed o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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