2023 (1) TMI 955 - AT - Income Tax
Long-term capital gain - cost of acquisition - capital gain worked out by the DVO - Assessee contended that Section 50C contemplates a deeming situation whereby the full value of the sale consideration is to be deemed equivalent to the amount on which stamp duty was paid for the purpose of calculating the capital gain - HELD THAT:- Assessee has brought to the notice of the ld. CIT(Appeals), the report of DVO, his submission which has duly been noticed by the ld. 1st Appellate Authority, but he failed to take cognizance of this report. The reference to the DVO was made during the pendency of the assessment proceeding. In such situation, its cognizance ought to have been taken. Therefore, 1st Appellate Authority failed in its duty to follow the correct procedure required for the disposal of the appeal.
Similarly both the authorities have erred in rejecting the calculation submitted by the assessee regarding cost of acquisition. They have calculated the long-term capital gain simply by taking into consideration the stamp duty valuation by applying section 50C ignoring all other provisions. Therefore, we direct the ld. Assessing Officer to calculate the capital gain assessable in the hands of the assessee on the basis of computation made by the assessee (extracted supra).
The capital gain will be calculated at Rs.47,77,384/-, out of that assessee has already calculated and shown at Rs.11,22,636/-. The addition is to be restricted to Rs.36,54,748/- instead of Rs.54,84,714/-. To be very specific, the capital gain including the gain disclose d by the assessee is directed to be calculated in the hands of the assessee at Rs.47,77,384/-. The credit of already shown of Rs.11,22,636/- is to be given to the assessee (Rs.47,77,384/- minus Rs.11,22,636/-) = net Rs.36,54,748/-. Appeal of the assessee is allowed.