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2024 (5) TMI 853 - ITAT PUNESTCG - Addition u/s 50C - taxing the difference between govt. valuation and actual sale consideration - contention of assessee that due to the location of the property the assessee was compelled to sell the property below the guide line value - as argued impugned land located near river bank was vulnerable to floods, it was situated near cremation ground and did not have any approach road and hence, its fair market value was only around Rs. 8,00,000 therefore, the addition made u/s 50C was not justified - HELD THAT:- We find that the appellant assessee requested to allow the deduction of cost of the land sold & also disputed the determination of fair market value of the land sold on the basis of guide line value of stamp duty before LD CIT(A)/NFAC, but he has not bothered to refer the matter to the valuation officer in the light of section 50C(2) of the IT Act, but only directed the AO to allow the cost of the land sold for the purposes of calculation of short term capital gain. It was the We find force in the contention of assessee that to overcome such situation in section 50C, an option is given to the assessee to object determination of fair market value on the basis of guide line value of stamp duty for the purposes of registration of the property & in such a case the AO is bound to refer the matter to the DVO. In the instant case the AO passed ex-parte order & therefore the request was made before LD CIT(A)/NFAC which was wrongly denied. Therefore, now we deem it proper to set-a-side the order passed by both the subordinate authorities & remand the matter back to the file of the AO to refer the matter to the valuation officer for the purposes of section 50C of the IT Act - AO will refer the matter to the DVO for determining the fair market value of the land sold & pass the order as per law in the light of report of the DVO after providing reasonable opportunity of being heard to the assessee. We order accordingly. Ground of appeal raised by the assessee is allowed for statistical purpose.
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