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2023 (4) TMI 564 - AT - Income TaxLTCG - Sale of immovable property of urban agricultural land - consideration of indexation cost on the basis of report of Govt. approved Valuer - assessee is NRI staying at Arizona, USA since many years and did not maintain the books of account - argument of ld Counsel to the effect that in case of assessee`s co-owner the FMV as on 01.04.1981 was accepted at Rs.175 per sq. meter. - HELD THAT:- We note that in case of assessee`s co-owner, there was no scrutiny assessment under section 143(3) of the Act, hence there is no opinion of the assessing officer. Therefore, return of income accepted by the Department under section 143(1) of the Act, in case of assessee`s co-owner, cannot be accepted to determine FMV as on 01.04.1981, therefore arguments advanced by ld Counsel is hereby rejected. AO has calculated long term capital gain on sale of two pieces of land by applying the fair market value of the said land as on 01.04.1981 at Rs. 3.44 per sq. mtr. as against the assessee's claim of fair market value of the said land as on 01.04.1981 at Rs. 175 per sq. mtr. - As both the DVO valuation as well as Government approved valuations are nothing but estimation of value as on specific date, it will be reasonable and justified if the average of two rates are taken as fair market value of the said land as on 01.04.1981. This way ld CIT(A) took the average rate of FMV of land vide RS No.118/97 will be Rs.69 (Rs.135 + 2.55/2) and FMV of land vide Rs no.123/103/1 will be Rs.69 (Rs.135 + 3.14/2). Average FMV as on 01.04.1981 determined by ld CIT(A) is still lower side therefore, considering the facts of the assessee as narrated above, the FMV of land as on 01.04.1981 should be adopted at Rs.90 per sq. meter. We note that determination of fair market value as on 01.04.1981, after all, is an estimate only and therefore we are of the view that ends of justice would be met, if a rate of Rs.90 per sq. meter is adopted as fair market value as on 01.04.1981 for the purpose of indexed cost of acquisition, as the same would take care of the inconsistencies between DVO report and report of registered valuers of the assessee. Therefore, we direct the assessing officer to recompute capital gain on sale of land by taking fair market value of land at Rs.90 per. Sq. meter, as on 01.04.1981, for the purpose of indexation. Appeal of assessee is partly allowed.
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