TMI Blog2015 (11) TMI 1276X X X X Extracts X X X X X X X X Extracts X X X X ..... e. More so, when they impugned long term capital gains on both plots sold and constructed portion are of ₹ 11,63,540/- only to be assessed @ 20%. We take into account all these facts and circumstances and conclude that both the Assessing Officer as well as CIT(A) has wrongly rejected assessee’s valuation of the plot sold based on a registered valuer’s report. We accept its arguments and direct the assessing authority to adopt value of the plot sold as on 01- 04-1981 as ₹ 800/- per sq. yd. Constructed area valuation - It is to be seen that the assessee’s valuer has elaborated his findings at page 10 of the paper book in determining valuation thereof @ ₹ 1550/- per sq. yd. The lower authorities treat a sum of ₹ 500/- per sq. yd only as on 01-04-1981 to be just and proper. We find from the valuation report that this was an old construction raised in 1952 and 1967 having been renovated from time to time. We reiterate that ascertaining cost of construction; and that too from back date may not be always accurate. And it may also require some guess work. We feel it appropriate in larger interest of justice that this cost of construction @ ₹ 700/- per sq. y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be lower than the valuation of regd. valuer. 5.1 The Ld. CIT(A) has grievously erred in law and on facts in directing AO to work out profit on sale of shares in accordance with the decision in the case of Shri Sugamchand C. Shah. 5.2 That in the facts and circumstances of the case as well as in law, the Ld. ClT(A) ought to have held the profit on sale of shares of ₹ 61,448 as short term capital gain rather than directing AO to work out the same in accordance with the decision in the case of Shri Sugamchand C. Shah. 3. The assessee does not press for its grounds no. 1.1, 1.2, 5.1 and 5.2. This leaves us with the sole issue of valuation of the assessee s plot sold and building erected thereupon as on 01-04- 1981 for the purpose of computing its long term capital gains. The assessee-an HUF co-owned a plot FP NO. 418, SP No. 4, TPS3- (varied), opposite Municipal Commissioner s Bungalow, Ellis bridge, Ahmedabad measuring 1032.15 sq. yd. having constructed area of 351 sq. yd. It sold the same for ₹ 28,38,000/- in relevant previous year. Its registered valuer adopted land portion s value @ ₹ 800 per sq. yd as on 01-04-1981after taking into account five sale de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 11,63,540/- added to the Long term capital gain chargeable to tax amounting ₹ 11,63,540/-. . 4.2 The appellant has submitted in its written submission, which is as under: 'To calculate taxable capital gain, appellant relied on chartered civil engineer report who is also a Govf. registered and approved valuer, to get the value of property sold, as on 1/4/1981. (Copy enclosed) The valuer quoted the details of- instances which he gathered from the government record with final plot number, date of transaction and rate at which such transactions were finalized. Valuer had given detail report, with reasoning by utilizing his expertise knowledge and considering the transactions entered in to by third parties in immediate vicinity and during that period. Valuer had quoted five instance of such transaction within the range of 590 to 1174. From the number of transfer instances of surrounding area at that time the valuer certified the cost of land at 800 per sq. yard and construction at 1550 per sq yard. The valuation of property as on 1/4/81 is arrived at by valuer as under (Part II of Report) . LAND : 8,26 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wo instances are the one considered by the assessing officer. Therefore I agree with the assessing officer in valuing land at average price of these two sale instances i.e. RS 560 per square yard. The assessing officer's action in valuing plot of land as on 1-04-1981 at RS 560 per square yard is confirmed. As regards valuing building, assessing officer did not agree with the appellant's valuation at RS 574000. The appellant valued the building at RS 1550 per square yard. As on 1-04-1981, the cost of construction cannot be RS 1550 which was there around 2001. The cost of construction at that point of time could not be more than RS 500 per square yard. Assessing officer is therefore directed to apply the rate of RS 500 per square yard for 351 square yard construction. The value of building as on 1-04-1981 comes to RS 175500. Assessing officer is directed to compute long-term capital gain by adopting the aforesaid land and building value as on 1-04- 1981. As regards assessing officer's action of not allowing indexation while computing long-term capital gain, I do not find the action of AO appropriate. Just because the building is 35-year-old, benefit of indexat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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