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2014 (5) TMI 879 - AT - Income TaxComputation of capital gains – nature of land at the time of valuation i.e. as on 1-4-1981 - conversion of agricultural land into non-agricultural land in the year 2005 - Held that:- The assessee’s consistent contention has been that land should have been valued as non-agricultural land as on 01-04-1981 and the valuation of non-agricultural land as on 01-04-1981 should be adopted for calculating the long term capital gain on the ground that since the land when sold was non-agricultural land after conversion, it should be treated as non-agricultural land even before the date of conversion - This contention was backed by another argument that such treatment of agricultural land would bestow greater benefit on assessee which was the purpose of the provisions of law regarding applying cost inflation index while calculating long term capital gain. This argument is devoid of merit in view of the factual matrix of this case that as on 01-04-1981 land was agricultural land and to apply cost inflation index the same cannot be treated as non-agricultural land as on 01-04-1981 simply because the same was converted into non-agricultural land subsequently in the year 2005 when the same was sold as non-agricultural land - lower authorities have rightly treated this land as agricultural land as on 01- 04-1981 and assessing officer has rightly taken the valuation of the land @ 2.32 per sq. ft on the basis of comparable instances obtained by him from the concerned authorities - as per the provisions of section 55A of the Act, the AO may refer the matter to DVO in case valuation of any property on the basis of registered valuer has been shown by the assessee less than the market value - the situation is revere as in this case the assessee has shown value of the land as on 01-04-1981 more than the market value – the order of the CIT(A) is upheld – Decided against Assessee.
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