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2014 (4) TMI 1017 - HC - Income TaxDiscrepancies in valuation of investment – Investment in agricultural property – Fair market value - stamp value u/s 50C - Held that:- Following Commissioner of Income-tax Versus Dinesh Jain HUF [2012 (10) TMI 158 - DELHI HIGH COURT] - the error committed by the income-tax authorities in the present case is to jump the first step in the process of applying section 69B - that of proving understatement of the investment - and apply the measure of understatement. If anything, the language employed in section 69B is in stricter terms than the erstwhile section 52(2) - It does not even authorise the adoption of any yardstick to measure the precise extent of understatement - There can be no compromise in the application of the section - It would seem to require the AO even to show the exact extent of understatement of the investment - it does not even give the AO the option of applying any reasonable yardstick to measure the precise extent of understatement of the investment once the fact of understatement is proved. The AO is not only required to prove understatement of the purchase price, but also to show the precise extent of the understatement - There is no authority given by the section to adopt some reasonable yardstick to measure the extent of understatement - since it may not be possible in all cases to prove the precise or exact amount of undisclosed investment, it is perhaps reasonable to permit the AO to rely on some acceptable basis of ascertaining the market value of the property to assess the undisclosed investment - It is only to the extent that the rigour of the burden placed on the AO may be relaxed in cases where there is evidence to show understatement of the investment, but evidence to show the precise extent thereof is lacking - mere suspicion cannot take the place of proof - mere reliance upon the report of the Valuation Officer expressing his opinion as to the true value would be inadequate material for the AO to constitute evidence in the absence of positive evidence – thus, no substantial question of law arises foe consideration – Decided against Revenue. Short Term Capital Gain - Stamp duty - Held that:- the Tribunal rightly was of the view that direction to correctly apply the stamp duty rates to the sale price of the plot for arriving at the STCG in view of the provisions of Section 50C of the Act, while holding addition of various amounts towards sale of land over and above the stamp duty rates, to be not justifiable, as per the provisions of Section 50C of the Act - The CIT (A) had in fact directed the AO to re-compute the short term capital gain by taking the cost of plot at Rs.12 lac and to include the stamp duty towards the cost of acquisition - No fault was found with the order by the Tribunal - Decided against Revenue.
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