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2022 (11) TMI 240 - AT - Income TaxRevision u/s 263 - AO passed the reassessment order u/s 147/143(3) - Capital gain computation - error in computation of cost of acquisition - AO Replaced the full sale consideration with deemed sale consideration contemplated u/s 50C of the Act i.e., the amount equivalent to the sum for which stamp duty was paid - HELD THAT:- It is pertinent to observe that the deemed sale consideration u/s 50C of the Act is not an absolute figure. It has to be further verified u/s 50C sub-Clause (2) for determining the market rate all these aspects are to be examined. It is also pertinent to observe that the cost of acquisition was on 22/11/2004. The indexation with appreciation of cost of acquisition is calculated for taking a final figure for the purpose of reducing it from full sale consideration assumed u/s 50C of the Act. From the finding of AO it is to be seen that all these consideration must have gone by. It is not a mathematical formula. He has taken a particular cost of acquisition on the basis of valuer’s report and thereafter calculated the capital gain. This calculation may have been not matched with the understanding of the ld. Commissioner but this cannot be a reason to set aside the assessment for framing the same de-novo. Therefore, on this point, we are of the view that the impugned order passed by the ld. Commissioner is not sustainable. It is to be further notice that the ld. CIT himself failed to conduct any enquiry in the finding extracted supra pointing out as to why the valuer’s report considered by the Assessing Officer for taking cost of acquisition is erroneous. For taking action u/s 263 of the Act, twin conditions should be fulfilled i.e., the order should be erroneous inasmuch as it causes prejudice to the revenue. From the finding of the ld. CIT, it appears that the ld. CIT has erred in construing the position of law. As in the case of DG Housing Projects Ltd. [2012 (3) TMI 227 - DELHI HIGH COURT] has held that the ld. Commissioner should not simply relegate the point that the assessment order is erroneous to the AO. Commissioner, after analyzing the record, ought to have recorded a categorical finding and provided valid reasons as to how the assessment order is erroneous. In other words, the ld. Commissioner should have recorded a finding about the error that had crept in which required action u/s 263 - Therefore, in the absence of this finding, we are of the view that the impugned order is not sustainable and hence the same is quashed. Appeal of the assessee is allowed.
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