TMI Blog2019 (2) TMI 1124X X X X Extracts X X X X X X X X Extracts X X X X ..... cordingly. We do not find any infirmity in the order of CIT(A) above for holding that provisions of 50C is applicable as on the date of execution of the agreement to sale. Accordingly, AO is directed to take the fair market value of property as on the date of agreement to sale i.e., on 14/08/2007. We direct accordingly. - ITA No. 4361/Mum/2016 - - - Dated:- 20-11-2018 - SHRI R. C. SHARMA, AM AND SHRI RAM LAL NEGI, JM For The Revenue : Shri Santosh Deshpande For The Assessee : Shri S. M. Pradhan ORDER PER R. C. SHARMA (A. M): This is an appeal filed by Revenue against the order of CIT(A)-22, Mumbai dated 16/03/2016 for A.Y.2010-11 in the matter of order passed u/s.143(3) r.w.s. 92CA(4) of the IT Act. 2. Grounds taken by the Revenue reads as under:- Whether on the facts and in the circumstances of the case and in law, the Ld.CIT(A) erred in considering the date of signing the MOU for the purpose of adopting the value of the capital asset transferred, even though the actual possession was handed over at much later date i.e. at the time of executing the conveyance deed. Since, section 2(47) of I. T.Act read with Transfer of property Act, 188 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... company in the return of income filed by it at ₹ 20,60,45,566/- 4. The above facts were confronted to the assessee company and it was asked to justify as to why provisions of section 50C of the Act should not be invoked in its case. The assessee company made a request to make reference u/s.50C(2) of the Act to the DVO for determination of the FMV of the capital asset transferred. Therefore, the valuation of the capital asset transferred was referred under the provisions of section 50C(2) of the Act to the District Valuation Officer-1, Mumbai by the then AO, vide letter dated 12.02.2013 for determining the fair market value of the capital asset transferred. The DVO, Mumbai vide letter dated 14.03.2014 had sent a preliminary report estimating the fair market value as on 29.04.2009 at ₹ 42,83,00,000/-. In response to the same, the assessee vide letter dated 20.03.2014 had stated that the relevant date of valuation for section 50C should be 14.08.2007 when an agreement in the form of MOU was executed between the assessee company, HPCL and Balmer Lawrie Co. Ltd. and due to various sanctions, clearances etc. required from various Govt Departments such as Director of In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned order, CIT(A) deleted the addition after observing as under:- 5.9 I have considered the facts and circumstance of the case. There is no dispute that as per the tripartite MOU signed on 14.08.2007 ,.the sale consideration was fixed at ₹ 27.62 crores against which a sum of ₹ 14.39 stood received by cheque at the time of signing the MOU. The final consideration received for the property as per the conveyance deed dated 29.04.2009 was also ₹ 27.62 crores as fixed by the MOU. The only dispute is the date on which the FMV is to be adopted for the purpose of section 50C. The Assessing Officer had considered the conveyance date of 29.04.2009 as against the appellant's contention that the date of MOU should be taken. I find that on the issue of determining the deemed consideration for the purpose of section 50C, the various courts have consistently held that the stamp duty value /fair market value on the date of agreement to sell and not the registration date is to be considered. In the case of ITO vs Modipon Ltd. relied upon by the appellant, the Hon'ble ITAT, Delhi had referred to the decision of the Hon'ble Supreme Court in the case of Sanjeev Lal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r opinion, the character of the transaction vis-a-vis Income tax Act should be determined on the basis of the conditions that prevailed on the date the transaction was initially entered into. Accordingly, the applicability of the provisions of section 50C should be looked at only on the date of sale agreement. The Hon'ble Tribunal observed that the ratio of the above decision, had also been followed in the case of Kodura Satya Srinivas ITA No.556/559 dated 02.07.2010 and Mook Rani Reddy 311A/isaka) dated 10.12.2010. That no contrary decision has been brought to its notice and accordingly allowed the assessee's appeal. 5.10 The ratio in the above case has also been followed by the Hon'ble ITAT, Hyderabad in the case of Shri Mohd. Imran Baig, Hyderabad and others in ITA Nos. 1942-1954/Hyd/2014 in its order dated 27.11.2015 wherein it was held as under: 15. Having regard to the rival contentions and the material on record, we find that the issue is as to whether the date of agreement or the date of execution of sale deed has to be considered for the purpose of adopting the SRO value under S.50C of the Act. We find that : this issue is now settled in favour of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decided. Assessee also received a sum of ₹ 14.39 Crores by cheque at the signing of the agreement. However, agreement the sale was registered on 29/04/2009. The AO proposed to take valuation of property as on the date of registration i.e., 29/04/2009 and thereafter, at the request of the assessee matter was referred to the DVO. Dispute before the CIT(A) was that whether valuation to be taken as on the date of entering into agreement or as on the date when the sale deed is actually registered. The CIT(A) after relying on the various judicial pronouncements as quoted in his order reached to the conclusion that fair market value of the property is to be taken as on the date of agreement to sale. From the record, we found that at the time of entering into agreement to sale, the assessee has already received more than 50% of the advance, however, due to certain conditions, the sale deed could not be registered. Finally, it was registered only on 29/04/2009. The various decisions cited and relied on by the CIT(A), the Tribunal after relying on the decision of the Hon ble Supreme Court has held that when agreement to sale is executed between the parties and part consideration is rec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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