TMI Blog2011 (12) TMI 576X X X X Extracts X X X X X X X X Extracts X X X X ..... em. The return so filed by the assessee was processed u/s 143(1), thereafter, on finding that value taken by Stamp Duty Authority was more than the actual sale consideration, the AO issued notice u/s 148. The AO found that value of land for the purpose of stamp duty was more than the actual sale consideration received and shown by the assessee. Therefore, a show cause notice was given to the assessee for substitution of value taken by Stamp Duty Authority as a sale consideration for the purpose of computation of long term capital gain. The assessee objected for the same and requested for making a reference to the DVO for determination of fair market value as on the date of sale. The matter was referred to the DVO to send his report on the fair market value on the date of sale. According to DVO s report, value worked out to be more than the actual sale consideration received by the assessee but much less than the value taken by the Stamp Duty Authority. The AO has taken the valuation shown by the DVO and computed capital gain accordingly. The capital gains so computed by the Assessing Officer was upheld by the ld. CIT(A) and the assessee is in further appeal before us. 4. It was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contention of the ld. Authorized Representative was that the assessee entered into sale agreements for sales of agriculture land on 20.08.04. Xerox copies of the same were enclosed on pages no. 24 to 32.. The entire amount of sale consideration was received through account payee cheques. That at the time of entering into sale agreement the rate of property was very low and there was no boom in the real estate market. Thus it is against the basic principal of natural justice to take the basis of market rate at the time of registration instead of rates prevailing one year before the execution of sale deeds. 9. He further contended that even at the time of execution of sale deeds the prevailing market rate in the same locality in which assessee s land was situated and in the surrounding area are much more less in comparison to land sold by the assessee which will be clear from comparable sales instances filed by assessee along with xerox copies of sale deeds. It was submitted that in the Financial Year 2005- 06 in which assessee sold its land the prevailing market rate per acre was Rs.l lacs to 3 lacs and in the Financial Year 2006-07 ₹ 1.92 lacs to 4 lacs per Acre and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory occupancy and Industrial Cluster nearby Larger size plot . From the above it is clear that there was a contradiction in the report of DVO as at one place he has mentioned that the land is nearby Santosh Nagar which is quite posh locality and another place in the report he had mentioned that there is a lower category occupancy. Thus the report of the DVO suffers from lots of ambiguity and therefore liable to be discarded. 11. Further contention of the ld. Authorized Representative was that Ld.DVO has allowed deduction of only 10 % on accounts of heavy feeling due to big hole in the land and 10 % for Green Belt + near by Railway Line + Lower Category Occupation and Industrial Cluster nearby and Large Size of Plot. For these deficiencies the deduction should be allowed @ 50 %. 12. As per ld. Authorized Representative on the said agriculture land there was encroachment of tribal peoples and they have covered the land by their huts. In this respect appellant lodged police compliant at many times but up to the date of sale agreement no action was taken by the police authorities. This fact was not considered by the DVO. During the course of assessment proceedings after rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... belt and nearby railway line and on account of lower category of occupancy and industrial cluster nearby and larger size plot. 16. In reply to AO s show cause notice for taking the value determined by Stamp Duty Authority, the assessee has submitted detailed valuation report from the Registered Chartered Engineer and Government Valuer describing in detail the location of land. As per the analysis given by the Registered Valuer the value of the land per acre worked out to ₹ 3.40 lakhs. As per provisions of Section 50-C, where the consideration received or accruing as a result of transfer of capital assets is less than the value assessed by an authority for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed shall for the purpose of Section 48 be deemed to be the full value of consideration received on such transfer. Sub Section (2) of Section 50-C provides that on an objection by the assessee, the AO may refer the valuation of the capital asset to the Valuation Officer and where in such reference is made, the provisions of sub Section (2), (3), (4), (5) and (6) of Section 16A, clause (i) of sub Section (1, (6) and (7) of Sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... VO, we direct the Assessing Officer to allow rebate of 30% in place of 10% as considered out by the DVO. We also found that DVO has given a rebate of 10 % on account of land being situated in green belt and nearby railway line and also on account of lower category occupancy and industrial cluster nearby and large size plot. Keeping in view the various deficiencies observed by the DVO himself, the rebate given by him is not appropriate. Keeping in view all the facts and circumstances of the case, we direct the Assessing Officer to take rebate at 20 % due to the land of the assessee situated in green belt and nearby railway line and also on account of lower category occupancy and industrial cluster nearby and large size plot. We found that the entire land was situated in the same i.e. 507 and 508, whereas the DVO has given rebate on account of green belt and nearby railway line etc. only in case of Praful Kumar Jain. Since the entire land was situated in the same khasra, there does not appear to be any valid reason for not allowing rebate in case of Shri Arun Kumar Jain, Smt. Pushpa Jain and Shri Yogendra Jain, whose land was also situated in same khasra. Precisely, there was one lan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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