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2020 (12) TMI 105 - AT - Income TaxAddition u/s. 56(2)(vii) - consideration as shown in the conveyance deed is less than market value determined by the Stamp Valuation Authorities for the purpose of charging the stamp duty - AO failed to refer the issue of valuation to District Valuation Officer - addition in respect of share of wife in the property - Whether Section 56(2)(viib) applies only to immovable properties i.e. property which are fully constructed and not on properties which are under construction? - Assessment Order is liable to be canceled on the ground that the Assessing Officer failed to refer the issue of valuation to the District Valuation Officer though he was legally required to do so - HELD THAT:- AO completely ignored the valuation report of the Government Registered valuer submitted by the assessee and the submissions thereon - He mechanically applied provisions of section 56(2) to bring he difference between the stamp duty value and the actual sale consideration paid by the assessee without making any efforts to find out the actual cost of the property when in fact the assessee stated that the property when purchased was under semi construction stage and there were disputes between builders and the purchasers and ultimately the builder was abandoned the project and left. The assessee also stated that what was purchased as per the agreement is different than what was given to him as the property was sold to two persons. So there is dispute in the area acquired by the assessee also. In such circumstances, it was all the more necessary for the AO to refer it to the Valuation Officer which he miserably failed. Even at the stage of appellate proceedings when the assessee produced Valuation Officer’s report who valued Flat No. 601 in the very same Building at ₹.1,00,76,000/- the Ld.CIT(A) should have called for remand report and in turn the Valuation Officer’s report which the Ld.CIT(A) failed to do so. In such circumstances the addition made by the Assessing Officer is totally unjustified and cannot be sustained. Revenue cannot be allowed a second inning by sending the matter back to the Assessing Officer to prove before the Assessing Officer that the sale consideration was the fair market value of the property purchased by the assessee when the assessee was all along disputing valuation of the property and the revenue miserably failed to find out the correct value of the property both at assessment stage as well as at first appellate stage. - Decided in favour of assessee.
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