TMI Blog2017 (12) TMI 1777X X X X Extracts X X X X X X X X Extracts X X X X ..... y. Keeping all these relevant facts in view, the rate adopted by ITAT, Jaipur bench in first round at ₹ 300/- per sq. yard is quite fair and reasonable. Hence, the Bench directs to adopt the fair market value @ ₹ 300/- per sq. yard as on 01-04-1981. - ITA No. 396/JP/2017 - - - Dated:- 26-12-2017 - SHRI BHAGCHAND, ACCOUNTANT MEMBER For the Assessee : Shri P.C. Parwal, C.A. For the Revenue by : Smt. Poonam Rai, DCIT-. DR ORDER PER BHAGCHAND, AM The assessee has filed an appeal against the order of the ld. CIT(A)-2, Jaipur dated 30-03-2017 for the assessment year 2005-06 raising therein following grounds:- 1. The ld. CIT(A) has erred on facts and in law in confirming the order passed by the AO without following the direction given by the Hon'ble ITAT while setting aside the original assessment order. 2. The ld. CIT(A) has erred on facts and in law in confirming the action of the AO in computing the long term capital gain at ₹ 36,38,160/- by taking the fair market value of land as on 01-04-1981 at ₹ 200/- per sq. yard as against ₹ 1,400/- per sq. yard claimed by the assessee on the basis of the registered value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pted that he had taken the value of land without tallying with any information from Sub-Registrar or any other Government Department and that he had made an incorrect valuation of land. The Assessing Officer took the land rate at ₹ 140 per square yard i.e. average of the above sale prices and @ 10% on amount of corner plot and determined the indexed cost of land at ₹ 12,45,156/-.The CIT(A) accepted the FMV at ₹ 200 per square yard. The ITAT increased the FMV to ₹ 300 per square yard vide its order dated 8-04-2011. The relevant portion is reproduced below. 2.7 We have heard both the parties. Before us the ld.AR relied upon the decision of Third Member in the case of Jahanganj Cold Storage Vs. ACIT, 133 TTJ 278 (Agra). According to the ld.AR, the Third Member has held that the market value can be estimated by applying the reversal capital gain index. We have gone through the decision and there is no such finding given by the Third Member. In case one is not able to find out any comparable sale case for period for which valuation is to be done then one can consider it by applying the capital gain index on the sales made subsequent to the date but closer to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stance of property situated at JLN Marg Bhawani Singh Road which were sold in F.Y. 92-93 whereas the evidence on record shows that in respect of these two properties the fair market value was determined on 1-4-1981 24-10-1981 respectively. The land rate of these two properties is much higher than ₹ 300/- per sq. yard adopted by the Hon'ble Bench.The fair value of land as per these two instances is not considered by Hon'ble Bench at all nor parra 1(iv) of written submission is considered. This has resulted into a mistake apparent on record in directing to adopt FMV of land as on 1-4-1981 at ₹ 300/- per sq. yard. .. The other property has been sold in Oct.81 but the location is different from the location of the property under reference. This property consisted of 2 storeyed building and a basement. Details of constructions are also available in the sale deed. Built up area of ground floor is168.3 sq. feet. First floor 1778.89 and underground floor is 1483 sq. feet. Plot are 372.50 sq. meter. The property consisting of land and building was sold on5.5 lakh. The assessee determined the land rate without considering the constructed portion. While passing t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y being referred to by the Authorized Representative relates to the valuation of property at 3, Chetak Mark, JLN Marg, Jaipur for which the valuation was made on 502-2005 for the period 01-04-1981in which the valuer has referred to the property at Bhawani Singh Road, which was sold on 24-081981. Thus the ld. CIT(A) has considered this property and rejected the same as it was not a comparable case being in a different locality and of a subsequent period. In the set aside proceedings, also the Assessing Officer has opined that the localities are not comparable. In the present proceedings, the Authorized Representative reiterated the same facts as in the earlier proceedings. The opinion of the Departmental Valuation Officer was taken on the issue as he is equipped with technical expertise on the issue. As per the report the Valuation Officer has opined as follows: As far as the issue of comparability of properties at Ghiya Marg, and BhawaniSingh Road is concerned, it is seen that these two area fall in the distinct localities of Jaipur i.e. Bani Park and C-Scheme respectively. The order of preference for comparable sale is concerned as under:- (1) Adjacent Land (2) Land in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B Date of sale 11.12.1981 C Sale value 11070.00 E Area of plot in Sqm = 184.50 Sqm F Land rate in Rs. Per Sqm 11070.00/184.50 = 60.00 5 Property Details Part of B-20, Shiv Marg, Bani Park, Jaipur A Sale instance document No. 2834 B Date of sale 07.11.1981 C Sale value 7542.00 E Area of plot in Sqm = 125.70 Sqm F Land rate in Rs. Per Sqm 7542.00/125.70 = 60.00 Further, five more sale instances of the same area were forwarded which showed the rates of land as above. The same were forwarded to the authorized representative and he was provided an opportunity to comment on the same. The Authorized Representative submitted as follows: Submission ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow by the District Valuation Officer of the same locality, validate the sale values of the land adopted by the Assessing Officer. The CIT(A) after considering various factors in the first round of appeal had taken the value at ₹ 200/- per square yard which in my opinion is reasonable. In view of the discussion as above, the value of the land for ascertaining the cost of acquisition on 01-04-1981 is found reasonable at ₹ 200/-per square yard and confirmed accordingly. The ground of appeal is partly allowed. 2.2 During the course of hearing, the ld.AR of the assessee has filed the following written submission to allow the grounds raised above. Submission:- 1. At the outset we may point out that the lower authorities have passed the order without following the direction given by the ITAT. The ITAT had specifically directed that sale instance of Bhawani Singh road property be considered. Infact the ITAT had recalled its order admitting that while estimating rate of ₹ 300/- per sq. yard, it had not considered the sale instance of Bhawani Singh road property. In the fresh order also, ITAT has categorically held that sale instance was not considered by the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngh Road. It may also be pointed out that the registered valuer Shri Govind Singh Bafna vide his report dt. 05.02.2005 (PB 56-65) has determined the fair value of the land at Plot No. 3, Chetak Marg, JLN Marg near J.K. Loan Hospital as on 01-04-1981 at ₹ 1,093/- per sq. meter based on the sub registrar rate. These instances are more indicative of the FMV as on 01.04.1981 of the property sold by the assessee and therefore, the rate of ₹ 200/- per sq. yd. adopted by the lower authorities is not correct. Even the registered valuer of the assessee has adopted the FMV of the land as on 01.04.1981 as per the local survey at ₹ 1,400/- per sq. yd. (PB 3-7). Though the registered valuer in the original assessment proceedings has stated before the AO that he has adopted the value without obtaining any information from the sub-registrar but he has adopted such value based on local survey and once he has adopted such value, the Ld. CIT(A) has no authority u/s 55A to refer the matter to DVO as the estimate made by registered valuer is not less that its FMV. For this proposition, reliance is placed in following cases:- CIT Vs. Puja Prints (360 ITR 697) (Bom) Hiaben Jayant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the value of land at ₹ 8,68,252/- which gives the land rate of ₹ 1,540/- per sq. yd. (8,68,252 divided by 563.80), being a corner plot. The ld. CIT(A) has sought the opinion of DVO who had provided the land rate of Shiv Marg, Bani Park and Madhao Singh Road, Bani Park as on 01.04.1981 at ₹ 60/- sq. mtr. and ₹ 167/- sq. mtr. Respectively. Thus there is a wide gap in land rate as given by Registered Valuer and actual sale instances cited by the DVO. The Registered Valuer had simply stated in the Valuation Report that the rate of land as on 01-04-1981 is ₹ 1400/- per sq. yard based on local survey. No sale instance is quoted to arrive at such rate by Registered Valuer. Thus Registered Valuer s valuation of land @ ₹ 1400/- per square yard is not based on any independent supporting document. It is simply mentioned in the valuation report that rate is based on local survey. However, what evidences were gathered in the survey to arrive at such rate is not provided. Therefore, in my considered view the value adopted by the Registered Valuer at ₹ 1400/- per sq. yard is very high and unreasonable. The DVO had given sale instances of the same loca ..... X X X X Extracts X X X X X X X X Extracts X X X X
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