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2016 (11) TMI 1646 - AT - Income TaxEligibility for deduction u/s 54B - whether the AO was justified in adopting the indexed cost of acquisition as per the value of DG Stamps ? - HELD THAT - As the particular property in question has its own location and other parameter as very important mentioned in the above parameter of factor affecting the valuation report hence increasing it by 10% cumulatively upto 1981 which becomes Rs. 21.43 per sq.mts for the year 1991. Hence he adopted the land value at Rs. 3, 36, 451/-. AO has adopted the rate on the basis of sale deed registered with the Stamp Valuation Authority situated in the nearby area. The law is well settled that the DG Stamps valuation would not be a proper indicator for ascertaining the Fair Market Value. However the registered valuer has applied the rate as per the Circular issued by the Government of Rajasthan. Such valuation ought not to have been set aside without referring the matter to the DVO as per section 55A(a) of the Act. Therefore we set aside the order of the AO on this issue and direct the AO to adopt the valuation as reported by the Registered valuer at Rs. 3, 36, 451/-. This issue is decided in favour of the assessee and against the revenue. Entitled for indexed cost of improvement - AO has not allowed the indexed cost of improvement on the basis that no evidence has been furnished - HELD THAT - No direct evidence with regard to the expenditure is placed on the record demonstrating the incurrence of the expenditure. But the fact that in the agricultural land such expenditures are incurred in the course of time. This fact cannot be lost sight of. Therefore after considering the facts we allow 50% of the indexed cost of improvement as claimed by the assessee being the reasonable expenditure incurred by the agriculturist on the improvement of the land. The assessee gets relief of Rs. 6, 52, 398/-. This ground of the assessee is partly allowed. Claim of deduction u/s 54B for making investment in the agricultural land in the name of the wife - HELD THAT - As decided in KALYA VERSUS COMMISSIONER OF INCOME-TAX 2012 (6) TMI 239 - RAJASTHAN HIGH COURT the word assessee used in the Income Tax Act needs to be given a legal interpretation and not a liberal interpretation as contended by the learned counsel for the appellant. If the word assessee is given a liberal interpretation it would be tantamount to giving a free hand to the assessee and his legal heirs and it shall curtail the revenue of the Government which the law does not permit - decided against assessee Not allowing the deduction u/s 54F - HELD THAT - Section requires the assessee to acquire a residential house and so long as the assessee acquires a building which may be constructed in such a manner as to consist of several units which can if the need arises be conveniently and independently used as an independent residence the requirement of the section should be taken to have been satisfied. Fact that the residential house consists of several independent units cannot be permitted to act as an impediment to the allowance of exemption u/s 54/54F - In the case in hand out of the sale consideration the assessee purchased a residential house for Rs. 41 lacs on 31.12.2005 adjoining to the existing house. Thereafter the existing house was demolished and a new house was reconstructed so that the house purchased and house reconstructed would meet the requirement of the family. This fact is not rebutted by the revenue by placing any contrary material on record. Therefore by following the ratio laid down in the case of CIT vs. Syed Ali Adil 2013 (6) TMI 278 - ANDHRA PRADESH HIGH COURT and Gita Duggal vs. CIT 2013 (3) TMI 101 - DELHI HIGH COURT we hereby direct the AO to allow the claim of deduction under section 54F
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