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2023 (2) TMI 451 - ITAT CHENNAICapital gain computation - fair market value determined by the DVO in terms of provisions of section 50C(2) - sale of property by adopting fair market value determined by the DVO - assessee has requested for reference to DVO and the Assessing Officer has referred valuation of property to Departmental Valuation Cell - HELD THAT:- AO admitted fact that the DVO did not submit valuation report. Therefore, he has completed assessment by adopting guideline value fixed by the authorities for payment of stamp duty. In our considered view, the mandate of law as prescribed u/s. 50C(2) of the Act, is that the AO is bound to refer valuation of property to the DVO, in case the assessee seeks to refer valuation to the Departmental Valuation Cell and further, the AO is bound to consider value determined by the DVO for the purpose of provisions of section 50C(1) of the Act. Since, the AO has failed to comply with mandate of the law, even though he had referred valuation to the DVO, in our considered view, the issue needs to go back to the file of the AO to reconsider the issue in light of provisions of section 50C(2) of the Act. Hence, we set aside the issue to the file of the AO and direct the AO to obtain necessary valuation report from the DVO and re-compute the capital gain from sale of property by adopting fair market value determined by the DVO. AO is also directed to consider cost of acquisition of the property and exemption claimed u/s. 54F of the Act in accordance with law. Appeal filed by the assessee is treated as allowed for statistical purposes.
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