Mrs. Lata S. Pinge Prasad, 4th Road, Santacruz (East), Mumbai 400 055 Vs. ACIT Circle 19(2), Piramal Chambers, Lalbaug, Mumbai 400 012
April, 10th 2015
IN THE INCOME TAX APPELLATE TRIBUNAL,
MUMBAI BENCH "A", MUMBAI
BEFORE SHRI R.C. SHARMA, ACCOUNTANT MEMBER AND
SHRI SANJAY GARG, JUDICIAL MEMBER
Assessment Year: 2008-09
Mrs. Lata S. Pinge Vs. ACIT Circle 19(2),
Prasad, 4th Road, Piramal Chambers,
Santacruz (East), Lalbaug,
Mumbai 400 055 Mumbai 400 012
PAN: AAFPP 0792B
Assessee by : Shri Hiro Rai, A.R.
Revenue by : Shri Asghar Zain, D.R.
Date of Hearing : 19.01.2015
Date of Pronouncement : 08.04.2015
Per Sanjay Garg, Judicial Member:
The present appeal has been preferred by the assessee against the order
of the Commissioner of Income Tax (Appeals) [hereinafter referred to as the
CIT(A)] dated 04.04.2012 relevant to assessment year 2008-09.
2. The sole issue taken in this appeal is relating to the determination of fair
market value as on 01.04.1981, of the property sold by the assessee during the
year under consideration, for the purpose of computing the taxable capital
3. The assessee during the year sold a flat for a consideration of Rs.40
lakhs. The assessee took the fair market value of the property as on 01.04.81
at Rs.3,39,840/- and calculated the index cost of acquisition at Rs.18,72,518/-
2 Mrs. Lata S. Pinge
and returned the long term capital gains at Rs.21,27,482/-. The AO
(hereinafter referred to as the AO), however, was of the view that the value
adopted by the assessee at Rs.3,39,840/- was on higher side. He therefore
referred the matter to the Departmental Valuation Officer. The Departmental
Valuer ascertained the value of the property as on 01.04.81 at Rs.2,12,400/-.
The AO, therefore, adopted the said value and computed the long term capital
gains accordingly at Rs.28,29,676/-. Aggrieved by the order of the AO, the
assessee preferred appeal before the Ld. CIT(A).
4. The Ld. CIT(A), after considering the submissions of the assessee, held
that the action of the AO in referring the matter to the Valuation Officer was
justified and that the AO has rightly adopted the value as determined by the
Departmental Valuation Officer. Aggrieved by the order of the Ld. CIT(A),
the assessee has come in appeal before us.
5. We have heard the rival contentions. The Ld. A.R. of the assessee has
contended that firstly the action of the AO in referring the matter to the
Departmental Valuation Officer was wrong and not justified as the fair market
value adopted by the assessee was more than that has been adopted by the
Departmental Valuation Officer. Further, that the value adopted by the
Departmental Valuation Officer is quite lower than that has been determined
by the Registered Valuer appointed by the assessee, which is at Rs.3.54 lakhs.
6. So far as the contention of the assessee that the AO was not justified in
referring the matter to the Departmental Valuation Officer is concerned, we do
not find any force in the said contention, if the AO was of the view that the
value adopted by the assessee was not correct having regard to the nature of
the asset and other relevant circumstances, he may refer the matter to the
Departmental Valuation Officer. The provisions of the statute cannot be
interpreted in a manner so as to make it redundant. We therefore do not find
3 Mrs. Lata S. Pinge
any infirmity in the order of the Ld. CIT(A) in holding that the AO was
justified in referring the matter to the .
7. So far as the issue relating to the value adopted by the is concerned, we
may observe that the work of determining the fair market value of the property
as on 01.04.81 is based purely on estimation basis. The assessee has estimated
the same at Rs.3.39 lakhs, whereas the Departmental Valuation Officer has
estimated the same at Rs.2.12 lakhs and the same as per the Registered Valuer
appointed by the assessee has been estimated at Rs.3.54 lakhs. The Ld. A.R.
of the assessee has stressed that the assessee had adopted the said value at
Rs.3.39 lakhs as per the stamp duty ready recknor. Taking into the overall
facts and circumstances of the case and also the fact that the determination of
the value of the property is an estimate work only, we are of the view that the
interest of justice will be well served, if the AO is directed to adopt the value
somewhere between the value estimated by the assessee and the Registered
Valuer on the one hand and the Departmental Valuation Officer on the other
hand which we direct to adopt at Rs.3 lakhs. The AO is accordingly directed
to compute the capital gains by adopting the fair market value of the property
in question at Rs.3 lakhs.
8. In the result, the appeal of the assessee is partly allowed.
Order pronounced in the open court on 08.04.2015.
(R.C. Sharma) (Sanjay Garg)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Mumbai, Dated: 08.04.2015.
* Kishore, Sr. P.S.
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Copy to: The Appellant
The CIT, Concerned, Mumbai
The CIT (A) Concerned, Mumbai
The DR Concerned Bench
//True Copy// [
Dy/Asstt. Registrar, ITAT, Mumbai.