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M/s. Krishna Enterprises Versus Addl. CIT – 12 (1) , Mumbai

2016 (12) TMI 52 - ITAT MUMBAI

Addition in difference in valuation of property arrived at by DVO - Held that:- In the instant case, the transactions were entered during the financial year 2006-2007 i.e., 1st April 2006 to 31st March 2007 which is prior to 01/10/2009. Therefore, as per CBDT, circular provisions of Section 50C are not applicable in so far as sales deed so executed were not registered with the Stamp Duty Violation Authority. We are also inclined to agree with learned AR Mr. Shashank Dandu that in view of the dec .....

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MI 271 - MADRAS HIGH COURT] is squarely applicable to the facts of the instant case where it has been held that since transfer was made prior to the amendment of Section 50C w.e.f. 1/10/2009, the provisions of section 50C would not be applicable. - Unregistered property was sold on 07/08/2006 which means, since the unregistered property was sold before the clarification was issued under Circular No.5/2010 dated 03/06/2010 where it clearly states that the scope of the provisions do not includ .....

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Per R. C. Sharma ( A.M ) This is an appeal filed by the assessee against the order of CIT(A) for the assessment year 2007-08 in the matter of order passed u/s. 143(3) of the I.T.Act. 2. The grievance of assessee relates to upholding addition of ₹ 10,91,130/- being the difference in valuation of property arrived at by DVO. 3. Rival contentions have been heard and record perused. 4. Facts in brief are that assessee is engaged in the business of construction and sale of flats. During the yea .....

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determination of the Fair Value of the property sold, who had declared the value to be ₹ 2,07,51,130/-. Difference in the valuation was added by the AO in assessee s income u/s.50C. By the impugned order, CIT(A) confirmed the action of the AO against which assessee is in further appeal before us. 6. Mr. Shashank Dandu, learned AR of the assessee vehemently argued that the total addition is only a small percentage of 5.5%(Approx) on the total amount of sale consideration declared by the Ass .....

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le to the facts of case in the A.Y.2007-08 under consideration. He invited our attention to the fact that unregistered property was sold on 07/08/2006 which means, since the unregistered property was sold before the clarification was issued under Circular No.5/2010 dated 03/06/2010 where it was clearly stated that the scope of the provisions do not include transactions which are not registered with stamp duty valuation authority, and executed through agreement to sell or power of attorney and he .....

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on value of the property, which was subject to transfer, based on report offered from District Valuation Officer. Thus, it is established that the market value determined of the said property is determined by an expert person i.e., DVO who is authorised to do the same as per his qualification. Accordingly it was argued that the addition so made by AO to Long Term Capital Gain of ₹ 10,91,130/- is justified and correct. Accordingly, the addition so made by AO and confirmed by the CIT(A) shou .....

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sale agreements for the same. The sale agreements were not registered, therefore, it was not possible to determine the stamp duty value as per provisions of Section 50C. However, the AO referred the matter to the DVO, who valued the four flats at ₹ 2,07,51,130/- against declared sale consideration of ₹ 1,96,,60,000/- by the assessee. Thus, there was a difference of ₹ 10,91,130/- which amounts to approximately 5.5% of the amount actually declared as the sale consideration. Circu .....

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accruing as a result of such transfer for computing capital gain. However, the present scope of the provisions does not include transactions which are not registered with stamp duty valuation authority, and executed through agreement to sell or power of attorney. 11. Thus, these amendments have been made applicable with effect from 1" October, 2009 and will accordingly apply in relation to transactions undertaken on or after such date. In the instant case, the transactions were entered dur .....

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