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TMI Blog2024 (5) TMI 842X X X X Extracts X X X X X X X X Extracts X X X X ..... e DVO s value. Assessee ground is allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... n Infrastructure Pvt. Ltd and the Hon'ble ITAT "SMC" Bench vide appellate order dated 01.03.2023 in ITA No. 395/Ahd/2022 for A.Y. 2012-13 allowed the appeal. Hence, the issue is duly covered by the order of the Hon'ble ITAT "SMC" Bench dated 01.03.2023. 4. The Ld. CIT(A) has erred in law and on facts in not properly considering various judicial pronouncements relied upon by the appellant company. The appellant company reserves its right to add, amend, alter or modify any of the grounds stated hereinabove either before or at the time of hearing." 3. The brief facts of the case are that the assessment of the assessee was reopened on the basis of information received by the Assessing Officer that the assessee had sold certain land (alongwith other co-owners of the said property) and it was found that the assessee company had shown the sale consideration of the land as per the registered sale deed, instead of market value of the said property as per stamp valuation. Accordingly, the Assessing Officer invoked the provisions of Section 50C of the Act and made addition of Rs. 3,43,960/- to the income of the assessee. 4. In appeal, the Ld. CIT(A) while pas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sale consideration received by the appellant company & others of Rs. 9,49,89,978/-. The appellant had submitted DVO's report dated 27.12.2019. (iv) The appellant company had made an application u/s. 154 of the Act vide letter dated 09.01.2020 before the AO, however, the appellant company had not received any rectification order till date. (v) In the rectification application u/s. 154 of the Act dated 09.01.2020, the appellant had contended that according to various judicial pronouncements by various courts if the difference between valuation adopted by the Stamp Valuation Authority or and that declared by appellant is less than 10%, the AO should adopt value as declared by the assessee. In the case of appellant, the value as declared by the appellant company & others is Rs. 9,49,89,978/- and the value as determined by the DVO is Rs. 10,34,91,000/-, which is approximately 8.95% higher but less than 10%. Hence, the appellant company has requested that value adopted by the appellant company is to be accepted. The appellant had relied on the judicial pronouncements also. 6.3 I find that the appellant has taken a plea that the Jantri (Circle rate) of the agricultural property ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... payment of stamp duty in respect of such transfer, the value so adopted or assessed 20[or assessable] shall, for the purposes of section 48, be deemed to be the full value of the consideration received or accruing as a result of such transfer: ……………………………... ……………………………… ………………………………. (3) Subject to the provisions contained in sub-section (2), where the value ascertained under sub-section (2) exceeds the value adopted or assessed 28[or assessable] by the stamp valuation authority referred to in sub-section (1), the value so adopted or assessed 28[or assessable] by such authority shall be taken as the full value of the consideration received or accruing as a result of the transfer.] 6.4.1 On plain reading of section 50C of the Act, it is seen that where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both, is less than the value adopted or assessed by an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luation of the asset in question is concerned, proceed to complete the assessment in conformity with the estimate of the Valuation Officer.]" It is seen from the above provision that the AO does not have any discretion but he/she "shall" proceed to complete the assessment in "conformity" with the estimate of the Valuation Officer. In this regard, reliance is placed on the decision of the Hon'ble Pune Tribunal in the case of Anil Murlidhar Deshmukrt vs. Income Tax Officer, Ward-3(2), Nashik [2019] 101 taxmann.com 93 (Pune - Trib.) [13-12-2018], had passed the judgement in favour of Revenue. The head note of the judgement is as under:- "Section 50C of the Income-tax Act, 1961 - Capital gains - Special provision for computation of full value of consideration - Assessment year 2013-14 - Assesses sold a property for consideration of Rs. 42 lakhs - Assessing Officer noted that stamp value of said property was Rs. 56.19 lakhs and, accordingly, treated stamp duty value as full value of consideration under section 50C - However assessee objected to stamp valuation and requested Assessing Officer to make a reference to District Valuation Officer (DVO) - DVO determ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermined by DVO on a reference made by Assessing Officer in terms of sub-section (2) of section 50C is less than value adopted or assessed by Stamp Valuation Authority then such fair market value determined by DVO has to be treated as full value of consideration received by assessee for purpose of computing capital gain - Held, yes [Para 10] [In favour of revenue] IT: Where fair market value determined by DVO on a reference made by Assessing Officer in terms of sub-section (2) of section 50C is less than value adopted or assessed by_ Stamp Valuation Authority then such fair market value_ determined by DVO has to be treated as full value of consideration received by assessee for purpose of computing capital gain. Circulars and Notifications: Circular No. 8/2002, dated 27-8- 2002" 6.5 In view of the above discussions and factual matrix of the case, valuation report of DVO and above referred judicial pronouncement of the Hon'ble Tribunals, the sale consideration determined by the DVO vide report dated 27,12.2019 is full and final for the AO while computing the capital gain in the case of appellant. Since, as per the DVO's report dated 27.12.2019, Full Value of Consider ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uce the relevant extracts of the case of Bhojison Infrastructure Pvt. Ltd. for ready reference:- "3. The assessee filed its return of income on 29.09.2012 declaring total income at Rs. 9,34,990/-. The same was processed under Section 143(1) of the Income Tax Act, 1961. Subsequently, information was received by the Assessing Officer that the assessee and other persons sold an immovable property at Surat for sale consideration of Rs. 9,49,89,978/- on 09.08.2011. The Assessing Officer further observed that the assessee has shown its share of sale consideration of Rs. 9,66,000/- whereas as per provisions of Section 50C of the Act the assessee was required to consider the Market Value (Jantri Value) of Rs. 13,09,830/-. From the details filed in Income Tax Return, the Assessing Officer confirmed that the assessee has not considered the Jantri Value in computation of capital gain. The assessment was reopened under Section 147 of the Act. The Assessing Officer observed that as per Rule of Gujarat State regarding levying of stamp duty on transfer of immovable property against sale, 4.9% of Jantri Value (Fair Market Value as decided for stamp duty) of the property is levied. The property w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment Order and the order of the CIT(A). 7. Heard both the parties and perused all the relevant material available on record. As regards to ground no.1, the re-opening of the assessment in assessee's case was justifiable as the independent satisfaction was given. Besides that, the assessee in the details filed in Income Tax Return did not consider the Jantri Value in computation of gain which is the disputed fact by the Revenue. Therefore, ground no.1 is dismissed. 8. As regards to ground no.2, from the perusal of the records it can be seen that in the return of income in respect of land and the value as determined by the DVO is approximately 8.95% higher but less than 10%. This was never disputed or controverted by the Revenue at any point of time. As per third proviso to Section 50C brought on statute w.e.f. 01.04.2019, the Tribunal on various occasions has applied the said proviso retrospectively as the difference is less than 10% in the actual value taken than the DVO's value. Therefore, ground no.2 is allowed. 9. In the result, appeal filed by the assessee is partly allowed." 6. We observe that the case of the assessee is directly covered by the aforesaid decision refer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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