TMI Blog2014 (11) TMI 889X X X X Extracts X X X X X X X X Extracts X X X X ..... ies (Madras) Pvt. Limited [1979 (6) TMI 8 - MADRAS High Court] it has been held that unless the price realised for transfer was such as to shock the conscious of the Court, if would not be possible to hold that the transaction is otherwise than for adequate consideration. Rule 11A of the GT Rules as well as rule 3B of the WT Rules fairly bring out the legislative intention for accepting the declared value of an asset for the purposes of wealth tax and gift assessments if the difference between the declared value and the fair market value is less than 33 1/3% or ₹ 50,000 - the market value as determined by the DVO under the W T Act as on 31.3.84 is ₹ 178.49 lakhs whereas the realised value shown by the assessee is ₹ 143. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 31.5.1991. The notice under sec. 16(1) of the Gift Tax Act was issued to the assessee. In response to the said notice, the assessee has shown the value gift made during the previous year at Rs. Nil. Thereafter, after considering the material on record, the assessment order came to be passed. Against the said assessment order, an appeal before the CIT(A) has been preferred by the assessee which was allowed. Against the said order of CIT(A), the Revenue has preferred an appeal before the ITAT which was dismissed, against which, the present Tax Appeal is preferred by the Revenue before this Court. 4. Heard the learned advocates appearing for the parties and considered the submissions. Learned advocate for the appellant has taken us through ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h effect from 1st January, 1973. Under the new provision, the Gifttax Officer may refer the valuation of any property to a Valuation Officer in a case where the assessee has got the property valued by a registered valuer and the Gift-tax Officer is of opinion that the value as estimated by the registered valuer (i.e. a person registered s a valuer under section 34AB of the Wealth-tax Act) is less than the fair market value of the asset. Other cases in which a reference may be made to the Valuation Officer would be where the Gift tax Officer is of opinion that the fair market value of the property exceeds the value of the property as returned by more than 33 1/3rd of the value returned or by more than ₹ 50,000, whichever is less, or wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his light also there was no gift in respect of impugned transaction as defined in Sec.2 clause (xii). I would therefore hold that the addition made by the Assessing Officer in this case is neither sustainable on facts not in law. I would therefore, delete the addition of ₹ 34,99,000/-. 6. The Tribunal, in paras 6,7, and 8 has observed as under: 6. We have carefully considered the facts and circumstances of the case as well as the rival contentions made before us. It is well settled that provisions of sec. 4(1)(a) of the G.T Act cannot be invoked in case of transactions which are bonafide and no attempt of evasion of tax is discernible. If the consideration which passed between the parties can be considered to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication for rewriting the rule by adding the words whichever is less . The well accepted rules of interpretation of statutes expressly negate any such construction. It appears to us that the amount of ₹ 50,000 is mentioned in the aforesaid rules under the statutes so as to obviate the possibility of references of small cases by the AO to the valuation cell. The percentage of 33 1/3% indicated in the rules appears to lay down the standard of acceptability of the declared value for the purposes of wealth-tax and gift tax assessments. In our opinion the transaction in question involving sale of Kashmir House by the assessee to its 100% subsidiary is a bonafide transaction and does not reflect any attempt of tax evasion on the part of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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