TMI Blog2014 (2) TMI 459X X X X Extracts X X X X X X X X Extracts X X X X ..... on of additions made on account of capital gain made by the Assessing Officer after invoking the provisions of section 50C of the Income-tax Act, 1961 (hereinafter called in short "the Act"). 2. The facts in brief borne out from the record are that during the previous year corresponding to assessment year 2007-08, the assessee has sold two properties - one at City Centre (The Mall, Kanpur) and the other at Naya Ganj, Kanpur. The Assessing Officer invoked the provisions of section 50C of the Act and computed the capital gains accordingly having rejected the request of the assessee for making reference to the DVO for valuation of the property on the ground that the assessee has disputed the valuation determined by the Stamp Valuation Authority. While denying reference to the DVO, the Assessing Officer has also observed that in the light of provisions of section 50C(2) of the Act, a reference to the DVO cannot be made where the assessee has disputed the valuation so adopted by the Stamp Valuation Authority and the assessee has admittedly disputed the valuation adopted by the Stamp Valuation Authority. 3. Aggrieved, the assessee preferred an appeal before the ld. CIT(A) with the su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the light of provisions of section 50C(2) of the Act, the ld. CIT(A) is competent to issue necessary direction to the Assessing Officer to do so. Copy of the affidavit filed before the ld. CIT(A) is also filed before us and is available at pages 41 and 42 of the compilation of the assessee. The ld. counsel for the assessee has further contended that the assessee has been contending since beginning that the market value of the property is lesser than the value so adopted by the Stamp Valuation Authority for the purpose of payment of stamp duty, on account of its location and quality of construction. 5. The ld. D.R., on the other hand, has placed heavy reliance upon the order of the ld. CIT(A) with the submission that as per clause (b) of sub-section (2) of section 50C of the Act, a reference to the DVO cannot be made if the assessee has disputed the value so adopted by the Stamp Valuation Authority by filing an objection in appeal or revision or reference before any other authority, court or the High Court. In the instant case, the assessee has contended before the Assessing Officer that he has filed objection to the valuation so adopted by the Stamp Valuation Authority. Theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e the fair market value of the property in question cannot be entertained. 4. That it is a admitted fact that the deponent has made request to make a reference to Valuation Cell in order to determine the fair market value of the property, but without accepting the deponent's request, the A.Q has adopted consideration determined by the D.M for Stamp Duty purpose. 5. That the deponent vide written submission has brought on record that if the A.O has not made reference for determination of fair market value in view of provision of section 50C(2), your honour is legally empowered and justified in directing the A.O to first refer the property to Valuation Cell and then decide do so in view of provision of section 50C(2) and various judicial pronouncements wherein it has been held that word 'may' in section 50(2) has to be read as 'should', so that the provision is not redundant. In case, your honour, desire, the A.O may be directed to make local enquiry from District Court as to whether the deponent has filed any petition for challenging the valuation determined by the Stamp Valuation Authority for assessment purpose or not. It therefore prayed that A.O may be directed to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arket value of the property as on the date of transfer. But this reference is subject to clause (b) of sub-section (2) of section 50C of the Act, according to which where the value so adopted or assessed by the stamp valuation authority is disputed in any appeal or revision or reference before any other authority, court or the High Court, the reference to the Valuation Officer cannot be made by the Assessing Officer. The purpose or intention beyond this clause is to avoid clash of judgment or opinion of the two independent authorities. If clause (b) of sub-section (2) of section 50C of the Act is not available on the statute, there may be possibility of different opinions by different authorities with regard to the valuation of the property. Then, there would be dispute as to which authority is correct in assessing the correct valuation of the property. In order to avoid this situation, clause (b) was provided in sub-section (2) of section 50C of the Act. But in the instant case, the Assessing Officer and the ld. CIT(A) have placed heavy reliance upon the fact that the assessee has objected to the valuation so adopted by the Stamp Valuation Authority by filing an objection, but the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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