9911796707
TMI Blog2017 (1) TMI 258X X X X Extracts X X X X X X X X Extracts X X X X ..... . Departmental Representative. 3. Facts of the case, in brief, are that the assessee is an individual and filed his return of income on 03-03-2008 declaring total income of Rs. 68,222/- which was subsequently revised on 08-03-2011 declaring total income at Rs. 2,53,620/-. During the course of assessment proceedings, the Assessing Officer observed that assessee has declared long term capital gain on transfer of an immovable property. From the details filed by the assessee, the Assessing Officer observed that the assessee has determined the fair market value of the property at Rs. 14,50,000/- being cost of construction as on 01-04-1981. He, therefore, asked the assessee to furnish the details of capital gain and supporting evidence for adopt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same to the assessee. After considering the objections of the assessee to such valuation report the Assessing Officer adopted the fair market value of the property at Rs. 3,99,000/- as on 01-04-1981 as against Rs. 14,50,000/- shown by the assessee and accordingly determined the long term capital gain. 4. Before CIT(A) the assessee challenged the reference made by the Assessing Officer to the valuation officer u/s.55A of the I.T. Act. Relying on various decisions it was argued that if the value adopted by the assessee exceeds the fair market value the Assessing Officer cannot make a reference to the valuation officer to reduce the valuation and the same is out of the scope of section 55A. It was argued that by the Finance Act, 2012 an amend ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red in appreciating the fact that the reference made by the AO to the AVO to determine the FMV as on 01-04- 1981 after recording valid reasons u/s.55A(b)(ii) of the Act and not u/s.55A(a) as stated by the assessee. 4. The Ld.CIT(A)-III, Pune has grossly in appreciating the provisions of section 55A(b)(ii) which allows AO to refer the issue of determining the FMV of the asset as on 01-04-1981 if "Having regard to the nature of the asset and other relevant circumstances, if is necessary to so" as mentioned in the proviso. 5. For the facts and such other reasons as may be urged at the time of hearing, the order of Ld.CIT(A)-I, Pune may be vacated and that of the AO be restored. 6. The appellant craves leave to add, amend, alter or del ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng a reference u/s.55A of the Act to the DVO for determination of the fair market value of the property when the value adopted by the assessee is more than the fair market value. 8. We do not find any infirmity in the order of Ld.CIT(A) on this issue since the issue squarely stands decided in favour of the assessee and against the revenue by the decision of the Hon'ble Bombay High Court in the case of CIT Vs. Doulal Mohta (HUF) reported in 360 ITR 680 wherein it has been held that reference to the departmental valuation officer can only be made in cases where the value of the capital asset shown by the assessee is less than its fair market value as on 01-04-1981. Where the value of the capital asset shown by the assessee on the basis of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer. In fact, the Assessing Officer referred the issue of valuation to the Departmental Valuation Officer only because in his view the valuation of the property as on 1981 as made by the respondent-assessee was higher then the fair market value. In the aforesaid circumstances, the invocation of Section 55A(a) of the Act is not justified. 8. The contention of the Revenue that in view of the amendment to Section 55A(a) of the Act in 2012 by which the words "is less then the fair market value" is substituted by the words " "is at variance with its fair market value" is clarifactory and should be given retrospective effect. This submission is in face of the fact that the 2012 amendment was made effective only from 1 July 2012. The Parliamen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Sections 131, 133(6) and 142(2) of the Act is entirely based upon the decision of the Guwahati High Court in Smt. Amiya Bala Paul (supra). However, the Apex Court in Smt. Amiya Bala Paul (supra) has reversed the decision of the Guwahati High Court and held that if the power to refer any dispute with regard to the valuation of the property was already available under Sections 131(1), 136(6) and 142(2) of the Act, there was no need to specifically empower the Assessing Officer to do so in circumstances specified under Section 55A of the Act. It further held that when a specific provision under which the reference can be made to the Departmental Valuation Officer is available, there is no occasion for the Assessing Officer to invoke the gen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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