TMI Blog2019 (11) TMI 871X X X X Extracts X X X X X X X X Extracts X X X X ..... pplied blindly when there is registered valuer s report made available to the AO. Since the facts of this case are identical to the facts of the case law relied upon by the assessee, we direct the AO to adopt the fair market value of the cost of acquisition as certified by the registered valuer s certificate, instead of substituting the same with SRO value. Accordingly, we set aside the order of the Ld.CIT(A) and delete the addition made by the AO. Appeal of the assessee is allowed. - I.T.A.No.178/Viz/2019 - - - Dated:- 15-11-2019 - Shri V. Durga Rao, Judicial Member And Shri D.S. Sunder Singh, Accountant Member For the Appellant : Shri G.V.N.Hari, AR For the Respondent : Shri D.Manoj Kumar, DR ORDER PER SHRI D.S.SUNDER SINGH, ACCOUNTANT MEMBER : This appeal is filed by the assessee against the order of the Commissioner of Income Tax (Appeals)-2, Visakhapatnam in I.T.A.No. 10396/2016-17/ACIT,C-1, KKD/VSP/2018-19 dated 21.02.2019 for the Assessment Year (A.Y.) 2014-15. 2. All the grounds of appeal are related to determining the cost of acquisition on sale of pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mputed the capital gains at ₹ 1,44,97,563/- as under : Indexed Cost : Land 450.55 sq.yds @250 per sq.yd 1,12,637 x 939/100 ₹ 10,57,666/- Building 2503 sq.ft @21/- per sq.ft 52,563 x 939/100 ₹ 4,93,567/- Stamp duty others 2007-08 1,47,405 x 939/551 ₹ 2,51,204/- TOTAL ₹ 18,02,437/- Calculation of capital gains : Sale consideration ₹ 1,63,00,000/- Less : Indexed cost of acquisition ₹ 18,02,437/- Long Term Capital Gains ₹ 1,44,97,563/- 3. Against t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gineer as on 01.04.1981 as cost of acquisition. Accordingly requested to set aside the order of the Ld.CIT(A) and delete the addition made by the AO. The Ld.AR also relied on the decision of this Tribunal in the case of Padarti Venka Rama Chandra Rao, Guntur in I.T.A. No.216/Viz/2012 dated 16.09.2016. On the other hand, the Ld.DR strongly supported the orders of the lower authorities. 5. We have heard both the parties and perused the material placed on record. In the instant case, the assessee has sold the property admeasuring 450.55 sq.yds along with 2503 sq.ft building constructed with Madras Terrace roof for a consideration of ₹ 1.63 crores. The assessee has computed the capital gains declaring loss of ₹ 13,39,212/-. While computing the capital gains, the assessee had adopted the cost of acquisition or fair market value as on 01.04.1981 at ₹ 18,51,758/- and further increased by a sum of ₹ 1,47,405/- with aggregate fair market value of ₹ 19,99,163/- and claimed indexation which resulted in capital gains loss of ₹ 13,39,212/-. The fair market value as on 01.04.1981 was adopted by the assessee on the basis of Chartered Engineers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, when Act specifically provides powers to the A.O. under the provisions of section 55(2) of the Act, to refer the valuation of the property to the valuation officer, when he is of the opinion that the fair market value of the property adopted by the assessee is higher than the fair market value of the property. The A.O., without exercising the option of referring the matter to the valuation officer, simply adopted SRO value which is fixed in a different context to determine the cost of acquisition of the property. Therefore, we are of the opinion that the A.O. was erred in adopting SRO value to substitute the fair market value adopted by the assessee, which is based on a registered valuer certificate. 12. Now it is pertinent to discuss here the case law relied upon by the assessee. The assessee has relied upon the decision of Hon ble Karnataka High Court in the case of N. Govindaraju Vs. ITO Anr. 377 ITR 243, wherein the Hon ble High Court under similar circumstances held as under: Section 48 of the Act deals with the 'Mode of Computation' of income chargeable under 'Capital gains' and in that context 'full value of the consideration&# ..... X X X X Extracts X X X X X X X X Extracts X X X X
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