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TMI Blog2016 (7) TMI 1186X X X X Extracts X X X X X X X X Extracts X X X X ..... ppellants income from long term capital gains on sale of land by adopting circle rate value of land at Rs. 16,43,000/- instead of actual sale consideration of Rs. 5,00,000/- received by the appellant. 2. On the facts and circumstances of the CIT(A) have erred in adopting circle rate value for computing capital gains instead of actual consideration without referring the matter to the Valuation Officer. 3. On the facts and circumstances of the case the CIT(A) erred in ignoring the appellant request for referring the matter to Valuation officer and not considering the case laws cited by appellant in this regard. 4. On the facts and circumstances of the case CIT(A) erred in construing that the provisions of section 50C are mandatory ig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as to why the sale consideration be not taken at Rs. 16,43,000/- in view of the provisions contained u/s 50C of the Act. Finding the explanation furnished by the assessee not tenable, the AO calculated the long term capital gain accrued to the assessee to the following effect :- Sale consideration u/s 50C Rs.16,43,000/- Indexed cost of acquisition (as declared by the assessee) Rs. 2,06,780/- Rs.14,36,211/- Less deduction u/s 54EC Rs. 3,00,000/- Long Term Capital Gain Rs.11,36,211/- and made an addition thereof to the total income of the assessee. 3. Assessee carried the matter before the ld. CIT (A) by challenging the assessment order who has dismissed the appeal. Feeling aggrieved, the assessee has come up before the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pite of the fact that appellant had invested net amount of capital gains of Rs. 2,93,211/- in specified Bonds as specified in section 54EC." 6. Without prejudice the merits of the case, we are of the considered view that additional grounds now sought to be raised by the assessee, which are legal grounds, are necessary for complete adjudication of the controversy at hand. So, we hereby allow the application moved under Rule 11 of Appellate Tribunal Rules, 1963 by the assessee to raise aforesaid additional grounds. 7. Ld. AR for the assessee challenging the impugned order contended inter alia that the deeming provisions contained u/s 50C (1) are not applicable to the case of the assessee in order to compute the exemption u/s 54EC; that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as Smt. Nilofer I Singh (2009) 309 ITR 233 wherein it is held that computation of capital gain is to be done as per provisions contained u/s 48 of the Act by taking into consideration the actual cost of sale consideration received by the assessee and not the deemed cost of consideration u/s 50C of the Act. Following the law laid down by Hon'ble jurisdictional High Court in the judgment of Smt. Nilofer I Singh (supra), coordinate Bench of the ITAT, Jaipur in case cited as Nand Lal Sharma (supra) returned the findings in favour of the assessee in an identical question. Operative part of the decision rendered by the coordinate Bench in the aforesaid referred case is as under:- "3.8 Apropos Ground No.2 (b), Hon'ble Delhi High Court in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat on the basis of actual sale consideration of Rs. 5,00,000/- received by the assessee, the long term capital gain came to be Rs. 2,93,211/-. 12. So, in view of the decisions rendered by the Hon'ble jurisdictional High Court in case cited as Smt. Nilofer I Singh (supra), we are of the considered view that lower revenue authorities have erred in computing the capital gain in the instant case on the basis of deemed cost of consideration u/s 50C whereas AO was statutorily required to compute the capital gain as per provisions contained u/s 48 of the Act on the basis of actual cost of consideration received by the assessee. 13. The next question arises for determination in this case is :- "as to whether lower revenue authorities have erre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ginal asset, so much of the capital gain as bears to the whole of the capital gain the same proportion as the cost of acquisition of the long-term specified asset bears to the whole of the capital gain, shall not be charged under section 45: Provided that the investment made on or after the 1st day of April, 2007 in the long-term specified asset by an assessee during any financial year does not exceed fifty lakh rupees: ...... Explanation.-For the purposes of this section,- (a) "cost", in relation to any long-term specified asset, means the amount invested in such specified asset out of capital gains received or accruing as a result of the transfer of the original asset;" 15. So, in the given circumstances, AO as well as CIT ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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