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2022 (6) TMI 1067 - ITAT SURATCapital gain computation - FMV determination - reference to DVO - indexed cost of acquisition - addition u/s. 50C of the Act on account of difference in the value adopted by the DVO and the sale consideration taken by the assessee in his return of income - cost of indexation - HELD THAT:- As decided in in assessee’s co-owner case DHARMENDRA B. PATEL VERSUS THE DCIT, CIRCLE-1 (3) , SURAT. [2021 (7) TMI 247 - ITAT SURAT] Since the process of sale has been initiated from the date of Sale Agreement, the character of the transaction vis-a-vis Section 50C of the Income tax Act should also be determined on the basis of the conditions that prevailed on the date the transaction was initially entered into. Accordingly, the applicability of the provisions of section 50C should be looked at only on the date of Agreement to Sell. Cost of indexation claimed - Also in the above case of assessee's co-owner we find that the dispute between the assessee and the assessing officer is the rate of ₹ 825/- per square meter, as fair market value as on 01.04.1981, whereas the DVO has estimated the fair market value as on 01.04.1981 at the rate of 114.30 per square meter. We note that the DVO has himself stated in his report that the impugned land was situated at more appropriate location as compared to sale instances considered by him. We also agree with assessee’s land is situated in New City Light Area of Surat, which is costly area and prices of the land in the said area is very higher side. Therefore, considering the entirety of the facts and taking a holistic view the fair market value @ 607 per square meter should be adopted to meet the end of justice. Accordingly, the AO is directed to apply rate of ₹ 607 per sq. meter for calculation of indexed cost of acquisition for the purpose of computation of long-term capital gain in the hands of the assessee.
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