IN THE INCOME TAX APPELLATE TRIBUNAL
DELHI BENCHES : "G" NEW DELHI
BEFORE SHRI J.SUDHAKAR REDDY ACCOUNTANT MEMBER
AND
SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER
ITA No: 3866/Del/2013
AY : - 2009-10
Income Tax Officer vs. Shriyansh Prasad Jain
Ward-47 (2) Overnite Express Ltd.
New Delhi. Overnite House, Patel Nagar
New Delhi 110 008
(PAN AATPJ1544M)
(Appellant) (Respondent)
Appellant by : Shri Sujit Kumar, Sr. DR
Respondent by : Shri Sunil Kumar Tayagi, CA
Date of Hearing : 10.9.2015
Date of pronouncement : 30.9.2015
ORDER
PER SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER
The present appeal has been filed by the Department against the order
dated 26.04.2013, passed by the Ld. Commissioner of Income Tax (Appeals) - XXX,
New Delhi . The brief facts of the case, as borne out from the records, are that order
u/s 143(3) was passed on 29.12.2011 at an assessed income of Rs. 37,01,410/-
against the returned income of Rs. 9,85,831/-. An addition of Rs. 27,15,579/- was
made by the AO u/s 50C of the Income Tax Act, 1961 (hereinafter called the Act).
The AO had observed that the assessee had sold a co-owned property for a total
sale consideration of Rs. 1,20,00, 000/- vide sale deed executed on 27.12.2008.
ITA No.3866/Del/2013
ITO vs. Shriyansh Prasad Jain
This property was co-owned by the assessee with a 50% share therein. The market
value of the property was Rs. 1,55,52,000/- for the purposes of stamp duty
valuation. During the course of assessment proceedings, the assessee sought a
referral to the DVO for valuation of the property and on his request the matter was
referred to the DVO u/s 50C(2) of the Act. The DVO in his valuation report
calculated the value of the property sold at Rs. 62,63,250/-, as against Rs.
60,00,000/- declared by the assessee, being one-half of his share in the joint
property. The AO however ignored the report of the DVO and took the value of sale
consideration for 50% share of the assessee at Rs.77,76,000/- u/s 50C of the Act.
The AO was of the opinion that section 50C of the Act makes it obligatory to treat
the value adopted by the stamp valuation authority as the deemed sale
consideration received/accrued as a result of transfer. Accordingly a long term
capital gain of Rs. 27,15,579/- was calculated and added to the income of the
assessee.
2. On appeal, the Ld. CIT(A), after considering the submissions made by the
assessee, directed the AO to take the value of sale consideration at Rs. 62,63,250/-
on the basis of the DVO report. The CIT(A) also noted that the same value was
taken and accepted by Ld. CIT(A), Jaipur in the case of Mrs. Sunita Jain, the other
co-owner of the property. In the appeal before us, it is the Department's contention
that the Ld. CIT(A) has erred in accepting the valuation made by the DVO in respect
of another portion of the property owned by the co-owner and in reducing the
addition to Rs. 2,63,250/- on account of long term capital gains as per provisions of
50C of the Act. The Ld. AR on the other hand has argued that assessee had declared
the sale consideration of Rs. 60,00,000/- as per the sale deed. The stamp duty
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ITA No.3866/Del/2013
ITO vs. Shriyansh Prasad Jain
authority had valued the same at Rs. 77,76,000/- and when the assessee disputed
the same, the matter was referred to the DVO by the AO. It was also submitted that
valuation is a subjective matter and different values could be arrived at by different
valuers and since section 50C is a deeming provision, the assessee should not be
denied the benefit of a lower valuation.
3. We have duly considered the facts of the case and the surrounding
circumstances. It is undisputed that the assessee did object to the action of the AO
and accordingly the matter was referred to the DVO. In our considered opinion, once
the assessee has raised objections against the value adopted by the stamp duty
authority and the AO has referred the matter to the DVO at his instance, the report
of the DVO cannot be ignored and the AO is duty bound to adopt lower of either the
valuation made by the DVO or that of the stamp duty authority. As per section
50C(1), the valuation as fixed by the stamp valuation authority is taken as a bench
mark. As per section 50C(2), the bench mark can be reviewed by making a
reference to the valuation officer if the assessee claims that such value exceeds the
fair market value. As per section 50C(3), if the valuation as arrived at by the DVO is
found to be higher than the value as fixed by the stamp valuation authority, then the
value as fixed by the stamp valuation authority being the lower of the two is to be
applied. On a similar footing, where the valuation, as arrived at by the DVO, is less
that the valuation as per the stamp duty authority, the valuation as per the DVO
should be adopted. The learned CIT(A) has adjudicated the issue on similar lines.
We also find from records that the Learned CIT(A) - II, Jaipur has also discussed the
same issue in his order dated 30/08/2012 in Appeal No. 531/11-12, in which the
case of the other co-owner Mrs. Sunita Jain was considered and he has also pegged
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ITO vs. Shriyansh Prasad Jain
the valuation at Rs.62,63,250/- being the value of the other half of the property.
Therefore, in the circumstances of the case, it is our considered opinion that the Ld.
CIT(A)'s action in taking the value calculated by the DVO for calculation of long
term capital gains is perfectly in order. We accordingly uphold the order of the Ld.
CIT(A) and decline to interfere.
4. In the result the appeal filed by the revenue is dismissed.
Order pronounced in the open court on 30th September, 2015.
sd/- sd/-
(J. SUDHAKAR REDDY) (SUDHANSHU SRIVASTAVA )
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated: the 30. 9. 2015
`veena'
Copy of the Order forwarded to:
1. Appellant
2. Respondent
3. CIT
4. CIT(A)
5. DR
6. Guard File By order
Dy. Registrar
Sl. Description Date
No.
1. Date of dictation by the Author 11.9.2015
2. Draft placed before the Dictating Member 11.9.2015
3. Draft placed before the Second Member
4. Draft approved by the Second Member
5. Date of approved order comes to the Sr. PS
6. Date of pronouncement of order
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ITA No.3866/Del/2013
ITO vs. Shriyansh Prasad Jain
7. Date of file sent to the Bench Clerk
8. Date on which file goes to the Head Clerk
9. Date of dispatch of order
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