TMI Blog2014 (3) TMI 506X X X X Extracts X X X X X X X X Extracts X X X X ..... der personal and individual reasons - The relief granted by the appellate authority should be on the basis of apparent features of the property - The misfortunes happened to the assessee or the difficulties faced by the assessee or the matter of distress sale, etc. cannot be a ground to modify the valuation - If such extraneous factors are relied upon, the deeming provision of law stated in section 50C of the Act would be contravened – the order of the CIT(A) set aside – Decided in favour of Revenue. - ITA No. 1085/Hyd/2013 - - - Dated:- 12-3-2014 - Shri Chandra Poojari And Shri Saktijit Dey,JJ. For the Appellant : Smt. K. Haritha For the Respondent : Sri B. Shanthi Kumar ORDER Per Chandra Poojari, AM: This appeal by the Revenue is directed against the order of the CIT(A)-VI, Hyderabad dated 10th April, 2013 for assessment year 2005-06. 2. The Revenue raised the ground that the CIT(A) ought to have confirmed the addition made on the basis of the value of the property adopted by the SR for stamp duty purposes. 3. Brief facts of the case are that the assessee, deriving income from house property, other sources and income from capital gains had filed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as indicated by registration authorities, the LTCG chargeable to tax would be NIL. In support of the value of Rs. 12,000/- per sq. yard, the assessee had filed a certificate of market value issued by the Joint Sub Registrar, Gunadala, wherein it was mentioned that the market value was Rs. 12,000/- per yard as per 2005 market value guidelines register, although in another certificate, the same Joint Sub Registrar mentioned the market value at Rs. 12,000/- per sq. acre for the same property. However, while registering the property, the registration authorities have adopted the market value at Rs. 1536 per sq. yard (sqy). The AO commented in the assessment order that it is not known why the Joint Sub Registrar mentioned in the certificates lesser figures of market value and in view of this, both the certificates issued by the Joint Sub Registrar, Gunadala cannot be taken into cognizance. Further the assessee in the letter filed before the AO submitted that even if the market value at Rs. 12,000/- per sqy is considered, there will not be any long term capital gains chargeable to tax, since the investment in new property was quantified at Rs. 25,17,610/-. The AO, however, not consideri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facto substitute the actual sale consideration as being passed on to the seller by the purchaser in the absence of any admissible evidence. 8. The AR objected to invoking of provisions of Sec. 50C by the AO, which read as under: (a) the assessee claims before any assessing officer that the value adopted or assessed or assessable by the stamp valuation authority under sub-section (1) exceeds the fair market value of the property as on the date of transfer; (b) the value so adopted or assessed or assessable by the stamp valuation authority under sub section (1) has not been disputed in any appeal or revision or no reference has been made before any other authority, court or the High Court. the assessing officer may refer the valuation of the capital asset to a Valuation Officer and where any such reference is made, the provisions of sub-sections (2), (3), (4) (5) and (6) of Section 16A, clause (i) of sub section (1) and sub sections (6) and (7) of section 23 r sub section (5) of section 24, Section 34AA, section 35 and section 27 of Wealth tax Act, 1957 (27 of 1957), shall, with necessary modification, apply in relation to such reference as they apply in relation to a re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d property was old, with building more than 70 years old, as such there is no value for the constructed area, as against which the Registering Authorities put the market value at Rs. 370 (ground floor) to Rs. 400 (First Floor). Further, as per the assessee, the market value of the property was indicated at Rs. 12,000 per sq. yard, for the year 2005, as per the certificate dt. 31.12.2007, issued by Joint Sub Registrar, Gunadala, Vijayawada, for the purpose of court proceedings, and if the value is adopted at the same rate, there would not be any further capital gains by virtue of investments made in property at Hyderabad. In this regard, it may be relevant to mention that such claim of the assessee was rejected by the AO for the reasons that the same Registering Authority issued the certificate, putting the value of the property under reference at Rs. 12,000/- per acre and the same property got registered at the value of Rs. 18,000/- per sq. yard. In the light of inconsistent position/stand taken by the Sub-Registration Authorities, the AO adopted the value of the property at market value as per the sale deed, as on 28.01.2005, which has been worked out as under: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ins. The valuation indicated by the Registration Authority, support the alternate plea of the assessee, where the valuation as per the sale deed is disputed by the AO. There is no separate information to the AO to dispute the value as per the sale deed, except the value as per DRO. Under the circumstances, the judicial decision in the case of CIT Vs. Chandini Buchar (supra), as relied upon by the assessee, support the view that the AO is obliged to bring on record positive evidence, indicating that the assessee has paid anything more than the sum disclosed in the purchase deed. In this case, not only the AO failed to bring in the further evidence to indicate higher price paid by the assessee but also ignored to look at the problems associated with the property under reference as well as the value of the property indicated by the Registration Authorities, as an alternative evidence for valuing the property. Thus, based on the facts of the case and the judicial decisions, the CIT(A) was of the opinion that the AO should accept the sale value as shown in sale deed or adopt the value of the property as per the valuation for court proceedings, as indicated by the Registration Authoritie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the assessee had explained that the assessee has made sale of capital asset on account of old age and pending litigations with the tenants. In other words, it was a distressed sale. It was also brought to the notice of the CIT(A) that the Joint Registrar has given two certificates, vide letter dated 31.12.2008 for the year 2005, that the property valuation in that area is at Rs. 12000 per sqy and another certificate Rs. 12000 per acre. However, facts on record suggest that the property was registered by the assessee with the Registration Authorities at Rs. 18000 per sqy. Had the assessee has any grievance, she should have challenged the value adopted by the SRO before the Registrar. The assessee having not challenged the value adopted by the SRO for registration purposes at Rs. 18000 per sqy, she cannot challenge the valuation adopted by the SRO before us. In our opinion, these factors, however, heartening may be, cannot be acted upon by the authorities for the reason that section 50C is a deeming section. Any relief granted to the assessee must be on the basis of a reason. The reason must be within the four corners of the law. Whatever may be the problems suffered by an assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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