TMI Blog2011 (8) TMI 656X X X X Extracts X X X X X X X X Extracts X X X X ..... b For the Respondent: Smt. Pushya Sitaraman and Ms. G. Vardini ORDER Abraham P. George, Accountant Member In this appeal of the Revenue its grievance is that CIT(A) deleted the addition made by the AO by adopting a fair market value of ₹ 15,000/- per ground as on 01-04-1981, for computing of long term capital gains. 2. Short facts apropos are that assessee had shown capital gains for sale of 1/9th undivided share in land at survey No. 85/2 and 85/5 of Thiruvanmiyur village, Mylapore, Chennai in her return of income. For working out the said capital gains, cost as on 01-04-1981 was adopted by assessee as ₹ 1 lakh per ground. The AO, for the purpose of ascertaining the correctness of the cost shown by the assessee, deputed his Inspector to collect information from the Sub-Registry office at Saidapet. According to the AO the details furnished by the concerned Sub-Registrar mentioned that at Survey Nos. 85/2 and 85/5, Thiruvanmiyur village, the value per ground was only 715,000/- as on 01-04-1981. Assessee was put on notice in this regard, whereupon she filed a reply enclosing therewith a report of approved valuer, as per which, the fair ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 13-2-2009] had held that guideline value could not be a conclusive proof and fair market value could be different from the value adopted by the registration authority. 7. We have heard the rival submissions and carefully perused the records. Assessee had returned the cost at the rate of ₹ 1 lakh per ground and computed her capital gains. AO had adopted ₹ 15,0007- per ground and recomputed the capital gains. Assessee supported her valuation through a report of the registered valuer, as per which the cost per ground as on 01-04-1981 was ₹ 1,20,000/- per ground. The Registered Valuer had specifically mentioned that he was a consulting civil engineer with 40 years experiance in valuation of property and ₹ 1,20,000/- per ground was being fixed by him as the land value prevailing as on 01-04-1981 after considering the proximity of the property to the Marundeeshwarar Temple, Thiruvanmiyur Bus Terminus and ECR Road. Ld. DR was not able to place before us the report of the Sub-registrar on the basis of which the Sub-registrar had come to a conclusion that the market value of the property was only ₹ 15,000/- per ground as on 01-04-1981. As already noted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per ground as on 01.04.1981. The Assessing Officer did not agree with such reply of the assessee and he completed the assessment computing capital gains, by adopting ₹ 15,000/- per ground as the fair market value as on 01.04.1981, against which, the assessee preferred appeal and the Id. CIT(A), while considering the decision of Hon'ble Jurisdictional High Court in the case of Thulasimani Ammal (supra) and coordinate Bench decision in the case of Mrs. N. Meenakshi (supra), has directed the Assessing Officer to adopt the market value of the land as on 1-4-1981 at 1,00,000/- per ground to compute the capital gains thereby allowing the appeal of the assessee. 11. Aggrieved by such order, the Department has come up in appeal and while relying upon the guideline value as provided by the Sub-Registrar concerned, it was pleaded that such value should be given preference to the value fixed by the Registered Valuer because the value as given by the approved value at ₹ 1,20,000/- per ground is not supported by any documentary evidence, whereas, the Sub-Registrar, who is registering various transfer documents with regard to land in that area has a valid basis for quoting p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sdictional High Court in the case of Thulasimani Ammal (supra) (quoted by the assessee and relied upon by the Id. CIT(A)) reads as under: It is well settled that guideline value of the Registration Department regarding valuation of the property has evidentiary value and they are only intended to give information or instruction to the registering authorities hut the guidelines, as such, would not establish the market value of the land. Here, the CIT has not conducted any independent investigation on the question of determination of the market value of the property gifted by collecting necessary materials for the determination of the same, de hors the guideline value. Since the determination of the market value of the property by the CIT is not based on relevant materials and the CIT has overlooked the material produced by the petitioner, the matter may have to be remitted to the CIT for fresh determination of the market value of the property. However, considering the fact that the assessment is of the year 1971-72 and the order of the GTO was made as early as 8th Aug. 1979, instead of remitting the matter to the CIT, the market value shown by the petitioner, which is based on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g question is formulated and referred to the Hon'ble President for nominating Third Member: In view of the facts and circumstances, whether the orders of authorities below could be set aside and matter can be remitted back to the Assessing Officer for reconsideration or order of the ld. CIT(A) could be upheld. THIRD MEMBER ORDER Dr. O.K. Narayanan, Vice-President (As a Third Member) The question referred to the Third Member is as follows : In view of the facts and circumstances, whether the orders of authorities below could be set aside and matter can be remitted back to the Assessing Officer for consideration or order of the learned Commissioner of Income-tax (Appeals) could be upheld. 2. Smt. Usha Ramesh, the assessee is an individual. She had sold her share in the landed property measuring 33 grounds at Thiruvanmiyur, Chennai. The assessee had 1/9th share in the said property originally purchased by her grand-father, Venugopal Pillai. The property purchased by her grand-father was settled in the name of her father Shri T.Devendran on 18.07.1958. Assessee's father, Shri T. Devendran, thereafter settled the property between himse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r ground. The assessee also placed reliance on the judgment of the Hon'ble Madras High Court in the case of Thulasimani Ammal (supra) wherein the Court has held that guideline value regarding valuation of property has evidentiary value and they are only intended to give information or instruction to the registering authorities, but the guideline value, as such would not establish the market value of the land. 6. The Assessing Officer, on the ground that the valuation report did not make any comparison of similar cases and for want of relevant details, adopted the guideline value collected from the Sub-Registrar Office and computed the taxable capital gains on the basis of fair market value of ₹ 15,000/- per ground as on 1.4.1981. 7. In first appeal, the Commissioner of Income-tax (Appeals) accepted the contentions of the assessee and held that the fair market value of the property as on 1.4.1981 should be considered at ₹ 1,00,000/- per ground. Thus, the first appeal was decided in favour of the assessee. 8. Aggrieved by the said order of the Commissioner of Income-tax (Appeals), the Revenue came before the Tribunal in second appeal. The learned Accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n and adopted the fair market value of the properly at ₹ 1,00,000/- per ground. In support of her claim, the assessee has filed valuation report framed by an approved valuer where the fair market value of the property as on 1.4.1981 was adopted at ₹ 1,20,000/- per ground. 13. On the other hand, the Assessing Officer relied on the guideline value collected from the Sub-registrar Office which stood at ₹ 15,000/- per ground as on 1.4.1981. 14. It is to be seen that the exact market value of the property as on 1.4.1981 cannot be worked out with mathematical accuracy. An element of estimation is inherent in such exercises. But what is important is that such estimate should not be arbitrary and unreasonable. There should be some basis and reasoning in arriving at a particular amount as the fair market value of the property as on 1.4.1981. The guideline value collected from the Sub-registrar Office is one among the guiding factors as held by the Hon'ble Madras High Court in the case of Thulasimani Ammal (supra). Such guideline values need not be the market value all the time. The market value is determined by so many external factors including the prevalent ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
