TMI Blog2018 (5) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... eady crystalised and has become final. Not only that AO also went beyond his jurisdiction to re-workout the cost of acquisition also which was not even disputed in the original order by the AO or by the assessee. Consequently, the addition of ₹ 3,92,869/- is not correct and should have been deleted by the Ld.CIT(A). We order it to be deleted. Assessee’s ground on this issue stands allowed. Assessee has raised objections regarding assessing the capital gains arisen in the hands of the mother, the same was also not answered properly, except stating that she has gifted the part of consideration to assessee. On what basis this conclusion was drawn is also not available from the record, as two of the properties were sold in the next ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... year 2006-07 relevant to the AY. 2007-08, assessee sold some of the properties and arrived at short term capital loss. The return of income was originally filed on 04-12-2007 and this was subject matter of scrutiny. During the scrutiny proceedings, AO invoked the provisions of Section 50C of the Act and made an addition of ₹ 23,75,500/- being the difference between the sale consideration shown by assessee and the sale consideration as per SRO Values vide order dt. 22-12-2009. On a further appeal, the Ld.CIT(A), Tirupati vide his order dt. 25-10-2010 has accepted assessee s contentions and held that even though AO should have referred the matter to the Valuation Cell while determining the value u/s. 50C(2) assessee had made a distress ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee because she was shown to have gifted the amount of ₹ 11 Lakhs to assessee. 4. In the re-assessment proceedings, AO calculated the capital gains assessable in the hands of Smt. Sarala at ₹ 3,90,479/- and this amount was brought to tax in assessee s hands. In addition to the above, AO also brought to tax an amount of ₹ 3,92,869/- on the sale of assessee s property by recalculating value of the property as per the valuation report and cost of the property separately worked out by him. Thus, AO made two additions to the income originally offered by assessee. 5. Before the Ld.CIT(A), it was the contention that proceedings u/s. 147 were initiated after four years, even though there is no failure on the part of ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not considered the objections of the appellant such as pending suits on mortgages and tenancies, purchase of the property at lesser than the then SRO guideline value and of course, the Vaastu defects. It is the case of the appellant that the properties were purchased knowning fully well of the legal problems and disputes arising from mortgages and tenancies and the appellant is also under disadvantage by being an NRI and his father being an aged person. With all theses back grounds, appellant pleaded that it is a distress sale. In such background, the AO should have referred the property to the Valuation Cell for arriving at the correct FMV for assessing the same u/s. 48. This is a procedural mandate aimed at fulfilling the principles of n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s prevented in re-valuing the sale consideration as the matter was already crystalised and has become final. Not only that AO also went beyond his jurisdiction to re-workout the cost of acquisition also which was not even disputed in the original order by the AO or by the assessee. Consequently, the addition of ₹ 3,92,869/- is not correct and should have been deleted by the Ld.CIT(A). We order it to be deleted. Assessee s ground on this issue stands allowed. 7.2. Coming to the addition of so called capital gains of Smt. Sarala in the hands of assessee, the same cannot be brought to tax for various reasons. First of all, the said property was gifted to assessee s mother by registered sale deed dt. 27-07-2006. Consequently, the same ..... X X X X Extracts X X X X X X X X Extracts X X X X
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