TMI Blog2018 (6) TMI 1184X X X X Extracts X X X X X X X X Extracts X X X X ..... No.5198/Mum/2016 - - - Dated:- 20-6-2018 - Shri Joginder Singh(JUDICIAL MEMBER) AND Shri G Manjunatha (ACCOUNTANT MEMBER) For The Appellant : Shri Virender Singh For The Respondent : Shri Kamlesh N Doshi ORDER Per G Manjunatha, AM : This appeal filed by the revenue is directed against the order of the CIT(A)-42, Mumbai dated 19-05-2016 and it pertains to AY 2012-13. The revenue has raised the following grounds of appeal:- 1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has not erred in directing the Assessing Officer to refer a property for valuation to the Valuation Officer and to assess the Capital Gains, thereafter, in the manner as prescribed under section 50C(2) of the Income Tax Act, 1961. 2. Whether on the facts and in the circumstances of the case and in law, the Ld.CIT(A) has nor erred by not appreciating that the power of the CIT(A) is coterminous with that of the AO, and he could have referred the property for valuation by the Valuation Officer, as the direction to this effect to the AO, tantamount to setting aside of the assessment order. 3. Whether on the facts and in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lcutta High Court in the case of Sunilkumar Agarwal vs CIT 225 Taxman 211 directed the AO to refer the valuation of property to the DVO and to assess capital gain thereafter in the manner as prescribed u/s 50C(2) of the Act. The relevant portion of the order of CIT(A) is extracted below:- Decision : The facts of the case, as summarized above, and the relevant orders and written submissions made are all duly considered. As all the ground of appeal relate to the addition made to the returned income on account of the sale consideration deemed u/s 50C of the Act all the grounds of appeal are decided together as under. The assessee has argued that the plot of land had no access to the road and she had requested her neighbour to allow her access through a 8 feet height strip passing through the neighbour s plot. It was claimed that since the adjoining area and plots had been purchased in due course by Shri Mukesh Bhandari and his concerns there were no other buyers for the assessee s property. It was also claimed that the building was in a dilapidated condition and the cost of repairs was mounting j for the assessee. It is also claimed that the title of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the matter whether under the Income Tax Act it is only the A.O. who can decide the status of an assessee. The Supreme Court observed that deciding the status of an assessee is part of the process of assessment. The assessee can object to it in appeal because the assessee denies his liability to be assessed under the Act in the circumstances of his case. The expression denial of liability is comprehensive enough to take in not only the total denial of liability but also the liability to tax under particular circumstances. In either case the denial is a denial of liability to be assessed under the provisions of the Act. In appeal the Appellate Authority, in the case of an order of assessment, confirm, reduce, enhance or annul the assessment i.e. he has plenary powers in disposing of an appeal. The scope of his power is conterminous with that of the Income-tax Officer. He can do what the Income-tax Officer can do and also direct him to do what he has failed to do. 2. In the case of Jute Corpn. of India Ltd. v. CIT (1990) 187 ITR 688 (SC) the Supreme Court again analysed the powers of the CIT(A). During the hearing of the appeal, the assessee had raised an additional groun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the High Court was in error in holding that the appellate power conferred on the AAC under section 251 was confined to the matter which had been considered by the ITO and that the AAC exceeded his jurisdiction in making an addition of ₹ 2,30,000 on the basis of the other 10 items of hundies which had not been explained by the assessee. Therefore, even if it was not held that the sum of ₹ 2,30,000 was added by the AAC as new sources of income, not considered by the ITO from the point of view of assessability, the AAC had jurisdiction or power to add the sum of ₹ 2,30,000 in the facts and circumstances in which he had added the same. Accordingly, the appeal was to be allowed. In view of the above, it is required to be seen whether the omission by the A.O. to refer a matter to the Valuation Officer can also be corrected at the CIT(A) level. This has been explained in the following cases:- A. In the case of C.W.T. v. Prasad Productions (P) Ltd [2003] 259 ITR 88 (Mad.) the Court was seized of the question as under: Whether, on the facts and in the circumstances of the case, the Tribunal is right in law in holding that referring the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on before the Bench was 2. On the facts and in the circumstances of the case and in law, the Ld CIT (A) as erred in directing the Assessing Officer to refer the matter of valuation of property to Valuation Cell appreciating the fact the assessee had not claimed before the Assessing Officer that the value adopted by Stamp Valuation Authority exceeds the Fair Market Value of the property as on the date of transfer. The IT AT has noted that the CIT(A) had relied on the decision of IT AT in the case of M/s. Ajmal Fragrances Fashion (P) Ltd. vs. ACIT (2009) 34 SOT 57 Mumbai and held that as per the provisions of section 50C(2) of the Act, AO should have referred the matter to the Valuation Cell and the Revenue's ground was rejected. D. In the case of Income-tax Officer, Ward 2(1) v. Smt. Manju Rani Jain[2008] 24 SOT 24 (DELHI) the Delhi bench of the IT AT has held that the CIT(A) was correct in directing the AO to make a reference to the DVO u/s 50C(2). Issue No. 2: The second issue is whether the reference to the DVO can be made when there is -no objection from the assessee on record of the AO: There is a direct decision in this regard from the Kolkata H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iating the fact that the CIT(A) is having co-terminus powers with that of the assessing officer, and he could have referred the property for valuation instead of directing the AO to refer it for valuation. The Ld.DR further submitted that when the Ld.CIT(A) was having co-terminus powers, he should have decided the issue in accordance with provisions of Act, by referring the matter to the valuation officer; however, he has set aside the issue to the file of the AO which tantamount to setting aside the order of the assessing officer which is not permissible under the law. The Ld.DR further submitted that the assessee never opposed to the proposal of the AO to invoke the provisions of section 50C of the Act during the course of proceedings, therefore, the AO left with no option but to invoke the provisions of section 50C to determine the correct market value of the property. Hence, there is no error in the order of the AO in applying provisions of section 50C and accordingly, his order should be upheld. 6. On the other hand, the Ld.AR for the assessee strongly supported the order of CIT(A). The Ld. AR further submitted that there is no cause of grievance for the revenue to file thi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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