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Shri Akhsay V. Sandhu Versus Income tax Officer-22 (2) - (1) , Mumbai

2017 (4) TMI 810 - ITAT MUMBAI

Enhancement of Income - calculation of long-term capital gain i.e. deduction u/s. 54 - reference to DVO - Held that:- The assessee had sold his inherited property in which she had a 12.5% share is a coparcener of Hindu Undivided Family (HUF),that all the coparceners of HUF decided to develop the property and the development agreement was entered with the developer, that the assessee had shown his long-term capital gain at ₹ 19.26 lakhs in his return of income, that the original assessment .....

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ng figures in the Tables for enhancing the income of the assessee,that the assessee had objected to the valuation of stamp duty authorities,that the matter was not referred to the DVO,that the assessee had challenged the original order of the AO before the FAA,that the then FAA had decided the issue in favour of the assessee,that during the assessment/appellate proceedings,challenging the order passed u/s.143(3)r.w.s.263 the order of the then FAA was not considered,that one of the grounds raised .....

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5 of the CIT (A) -25, Mumbai, the assessee has filed the present appeal.Assessee,an individual,had filed his return of income on 31/07/2008,declaring total income at ₹ 19.62 lakhs.The Assessing Officer (AO)completed the original assessment, u/s. 143 (3) of the Act,on 23/12/2010, determining his income at ₹ 28.15 lakhs. 2. The assessee, in his letter, dated 21/10/2016,has made a request to admit additional grounds of appeal.It was stated that ground raised by it was legal in nature an .....

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l of the record found that said assessment order was erroneous and prejudicial to the interest of the revenue.Accordingly,he passed an order u/s. 263 on 23/01/2013 directing the AO to revise the assessment. In his order, the CIT observed that as per the valuation of property and as per the stamp duty valuation the market value of the plot was ₹ 3.55 crores, i.e., the agreement value was shown at ₹ 2.50 crores, that in the return of income the assessee had calculated the capital gain .....

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nsideration would be ₹ 3.43 crores, that after considering the other expenses like stamp duty, registration charges, legal services, etc. the cost of temporary accommodation incurred by the developer comes to ₹ 34.69 crores, that the total consideration would exceed the stamp duty valuation of the property. 3.1. After considering the submissions of the assessee, the CIT observed that the stamp duty charges were made on the basis of property available at the time of transaction, that .....

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consideration for taxation.The CIT directed the AO to examine the above-mentioned two issues. In his order, passed u/s. 143 (3) r.w.s. 263 of the Act, the AO observed that as per the provisions of section 50 C for transfer of immovable property, the value fixed at ₹ 3.55 crores by the stamp valuation authority,was to be adopted if the value was more than the consideration shown as received, that value of the flat (Rs. 93.78 lakhs) was to be added as forming part of consideration for trans .....

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the flat, that assessee did not file any claim u/s. 54 of the Act, during the revisionary proceedings. 3.2. During the revisionary-assessment proceedings the Authorised Representative (AR) pointed out that notices u/s.263 were issued on 18/05/2012 and 09/01/2013, that an appellate order was already issued by the First Appellate Authority (FAA). However, the AO held that such issues could not be taken for consideration. Finally, he determined the income of the assessee u/s. 143(3) r.w.s. 263 on .....

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nted workable power of attorney in favour of the developers, that there was transfer of land by the assessee in favour of the developer for consideration, that provisions of section 50C of the Act were applicable, that the AO had rightly invoked the said provisions. He issued a show cause notice to the assessee asking to explain as to why the market value adopted by the state government should not be considered in place of the agreement value considered by the AO. He further asked the assessee a .....

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for receipt of consideration in terms of clause 11 of the development agreement, that the AO had not discovered the important aspect pertaining to sale consideration,that the full value of consideration received/accrued to the assessee would be ₹ 86.39 lakhs.He directed the AO to consider the said value as full value of consideration for the purpose of computing capital gains.With regard to disallowing the claim for deduction u/s. 54 of the Act, the FAA observed that the assessee did not c .....

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of 1180 sq. ft. instead of one 1008 sq. ft., that the of the cost of construction was taken at ₹ 38,300 per sq. ft. as against cost of construction of ₹ 7,500 per sq. ft., that the F AA had not referred the matter to the District Valuation Officer (DVO) though the assessee had disputed the valuation arrived at by the stamp duty authorities, that the actual development rights transferred pertained to half of the piece of land only,that balance was retained by the assessee and members .....

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alculation of long-term capital gain i.e. deduction u/s. 54 of the Act.The Departmental Representative (DR) supported the order of the FAA. 6. We have heard the rival submissions and their perused the material before us. We find that the assessee had sold his inherited property in which she had a 12.5% share is a coparcener of Hindu Undivided Family (HUF),that all the coparceners of HUF decided to develop the property and the development agreement was entered with the developer, that the assesse .....

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