TMI Blog2015 (12) TMI 1803X X X X Extracts X X X X X X X X Extracts X X X X ..... Short term capital gain computation - Additions made u/s. 50C - DVOs report acceptance at its face value - property is an undeveloped property connected with a kaccha road with a slaughter house in the vicinity - HELD THAT:- Assessee s Valuation Officer has reported the rate for Plot No. 14/1 at ₹ 272/-per Sq. mtr and for Plot No. 177 at ₹ 261/- per Sq. mtr. The same has been taken by the DVO at ₹ 623/- and ₹ 722/- per Sq. mtr respectively. A perusal of both the Valuation Report shows that none of the report is based on comparable cases being sale deeds in or near the impugned properties. Thus, there is no sale incidence to support the value taken by the respective valuation authorities. No doubt, the DVOs repo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s. 14A of the Act r.w. Rule 8D though the quantum differs in both the appeals. 3. We are taking up the facts of ITA No. 1441/M/2013. While scrutinizing the return of income, the Assessing Officer noticed that the assessee is having investment in shares, bonds etc at ₹ 70,15,05,138/- on which dividend income of ₹ 64,699/- was earned and claimed exempt. The assessee was asked to explain why disallowance should not be made u/s. 14A r.w. Rule 8D. 3.1. Vide letter dated 15.7.2011, the assessee replied that the dividend is represented by only one dividend warrant and direct and indirect expenses incurred in relation to earning of this exempt income amounting to ₹ 1,736/- have already been offered for disal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne through the computation of estimation of expenses made by the assessee. We find that computation at ₹ 917/- is quite reasonable. The AO has simply rubbished this computation made by the assessee without assigning any specific reason or fallacy in the computation. In our considered opinion on the peculiar facts of the case, the addition made by the AO is unwarranted, we, accordingly, direct the AO to delete the addition of ₹ 35,07,782/- in ITA No. 1441/M/2013 and ₹ 9,27,033/- in ITA No. 1442/M/2013. With this ITA No. 1442/M/2013 is allowed. 8. The second ground in ITA No. 1441/M/13 relates to the additions made u/s. 50C of the Act. 8.1. While scrutinizing the return of income, it came to the notice of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion made by the DVO by 50%. It was brought to the notice of the Ld. CIT(A) that without considering the objections made by the assessee, the AO has completed the assessment by simply relying upon the report of the DVO. 9.1. After considering the facts and the submissions, the Ld. CIT(A) observed that sale price as per the sale deed was lower than the value assessed by the Stamp duty authorities therefore a reference was rightly made by the AO. The Ld. CIT(A) was convinced that the AO was correct in adopting the valuation of the DVO in computing the short term capital gains and confirmed the addition. 10. Aggrieved by this, the assessee is before us. 11. The Ld. Counsel for the assessee reiterated what has been ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he DVOs report cannot be accepted at its face value. As mentioned elsewhere, the valuation report furnished by the assessee is also devoid of any sample sale in or around impugned property, therefore the value taken by the Valuation Officer also cannot be accepted. 14.1. In our considered opinion, such litigation should come to an end and therefore to put an end to the litigation, the value for plot No. 14/1 taken by the DVO at ₹ 623/- is to be reduced by 40%, the value now should be adopted is ₹ 374/-. Similarly, the value adopted for Plot No. 177 at ₹ 722/- is to be reduced by 35%, the value now should be adopted is ₹ 470/-. The AO is accordingly directed to consider these two values and recompute the Sho ..... X X X X Extracts X X X X X X X X Extracts X X X X
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