TMI Blog2014 (3) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... mputation of the LTCG – Held that:- Payment was directly made to Shri Nikhil Chanda and this was evident - Shri Nikhil Chanda had acknowledged receipt - it was a necessary outgo without which the sale would not have taken place - the computation of capital gains under section 48 of the Act - Sub-clause (i) of that Section states that expenditure incurred wholly and exclusively in connection with the transfer of capital asset has to be deducted from full value consideration received or accruing - Shri Nikhil Chanda was a confirming party who had nominated the buyers to the vendors. The vendors have contracted with the purchaser for sale and transfer of the said premises free from all encumbrances mortgages charges attachments liens lispendens leases tenancies occupancy rights uses debutters trusts acquisition requisition alignment claims demands and liabilities whatsoever or howsoever by the vendors to the purchaser at or for the consideration of Rupees four crores fifty lacs only paid to the vendors by the purchaser in the proportion as aforesaid and the confirming party has agreed to concur confirm and assure such sale - the payment could only be considered as an expenditure in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 97 which was a part of the total 27.69 Kattah of land sold. Since indexed cost of acquisition assessed by the Assessing Officer came down drastically, resultant capital gains was substantially increased. 4. Assessee's appeal before the ld. CIT(Appeals) against adoption of valuation done by the Departmental Valuation Officer for 12.97 Kattah of land was unsuccessful. 5. Now before us, ld. AR prayed for admission of an additional ground of appeal, which according to him was purely a legal one. According to him the additional ground assailed the reference to DVO made by the Assessing Officer under section 55A of the Act. In his opinion such reference was illegal and substitution of the cost of acquisition based on the report of DVO was arbitrary and unjustified. Ld. DR did not raise any objection to admission additional ground filed by the assessee. Hence the additional ground is admitted for adjudication. 6. Ld. Counsel for the assessee in support of the additional ground mentioned that DVO's report was sought under section 55A of the Act. Relying on the decision of Hon'ble jurisdictional High Court in the case of CIT v. Umedbhai International (P.) Ltd. [2011] 33 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... air market value of a capital asset for the purposes of this chapter, the Assessing Officer may refer the valuation of capital asset to a Valuation Officer (a) In a case where the value of the asset as claimed by the assesese is in accordance with the estimate made by a registered valuer, if the Assessing Officer is of the opinion that the value so claimed is less than its fair market value, (b) In any other case, if the Assessing Officer is of the opinion- (i) That the fair market value of the asset exceeds the value of the asset as claimed by the assesese by more than such amount as may be prescribed in this behalf, or (ii) That having regard to the nature of the asset and other relevant circumstances, it is necessary so to do. What is applicable here is clause (a) of the above section. Hence to make a reference under section 55A of the Act, Assessing Officer has to form an opinion that value claimed is less than the fair market value. On the other hand, the opinion of the Assessing Officer here is that the value shown was very high or in other words, more than the fair market value. This being the case we are of the opinion that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... portion of the judgment and order of the learned Tribunal. 6. The CIT(A) as well as the learned Tribunal has came to fact finding that the Department has not brought any material on record that AO had formed an opinion having regard to the nature of the assessment and considering the other relevant circumstances for making reference to Departmental Valuation Officer under s. 55A of the said Act. This concurrent fact finding of two authorities are not questioned to be perverse. 7. This Court cannot make any endeavour to make any fact finding nor does it wish to do in absence of plea of perversity. In this case the admitted position is that the assessee submitted valuation made by the registered Valuer. Hence cI. (a) of the aforesaid section is applicable in this case which is set out hereunder 55A. With a view to ascertaining the fair market value of a capital asset for the purposes of this chapter, the (Assessing) Officer may refer the valuation of capital asset to a Valuation Officer- (a) in a case where the value of the asset as claimed by the assessee is in accordance with the estimate made by a registered valuer, if the (Assessing) Officer is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eard the rival submissions, perused the material available on record and seen the computation of capital gains under section 48 of the Act. Sub-clause (i) of that Section states that expenditure incurred wholly and exclusively in connection with the transfer of capital asset has to be deducted from full value consideration received or accruing. Preamble of the Conveyance Deed executed by the assessee alongwith Shri Nita Basu reads as under : THIS INDENTURE made this 15th day of February Two Thousand and Eight BETWEEN (1) (SM.) NITA BASU (also known as NITA BOSE) wife of Shri Pranab Basu and daughter-in-law of Shri Santosh Kumar Bose and (2) VIVEK BOSE son of Shri Parmananda Bose both residing at 3A, Shyam Bose Road, Police Station Chetla, Kolkata-700 027 hereinafter referred to as the VENDORS (which expression shall unless excluded by on repugnant to the subject or context be deemed to mean and include their and each of their respective heirs, executors, administrators and legal representatives) of the FIRST PART AND RICKY CHANDRA son of Dhruba Chandra residing at 68A, Peary Mohan Roy Road, Police Station Chetla, Kolkata-700 027 hereinafter referred to as the CONFIRMIN ..... X X X X Extracts X X X X X X X X Extracts X X X X
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