TMI Blog2021 (5) TMI 520X X X X Extracts X X X X X X X X Extracts X X X X ..... It is further evident that the CIT(Appeals) has already adopted twice the specified value fixed by M/s. APIIC value for industrial plots and still the same comes to ₹ 8,91,93,400 as against the declared sum of ₹ 9,06,00,000. We thus find no reason to interfere with the CIT(Appeals) conclusion under challenge deleting the impugned addition. - Decided in favour of assessee. - ITA No. 1539/Hyd/2017 - - - Dated:- 6-5-2021 - Satveer Singh Godara, Member (J) And Laxmi Prasad Sahu, Member (A) For the Appellant : Rohith Majumdar, D.R. For the Respondents : Y. Ratnakar ORDER Satveer Singh Godara, Member (J) This Revenue's appeal for Asst. Year 2006-07 arises from the Commissioner of Income Tax (Appeals)-17 Hyderabad's order dt. 5.5.2017 passed in case No. 0507/CIT(A)-7/2016-17 in proceedings under Section 143(3) r.w.s. 254 of Income Tax Act, 1961 ('the Act'). Heard both the parties. Case file perused. 2. Coming to the Revenue's sole substantive ground seeking to revive the Assessing Officer's action making Long Term Capital Gains (LTCG) addition of ₹ 11,34,93,000 as per Department Valuation Officer (DVO's) report ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. According to him, the stand of the assessee that the difference that existed at the time of purchase between the purchase price and the valuation as per the registering authority has existed even at the time of sale also had no basis. He held that the property of the assessee over a period of time had gained much commercial value and as per the specific provisions contained in S. 50C the value adopted by the Stamp Valuation authority was required to be taken as sale consideration for the purpose of computing the long term capital gains. Accordingly, such value, which was less than the value determined by the DVO was adopted by the Assessing Officer as sale consideration and long term capital gains chargeable to tax in the hands of the assessee was worked out by him at ₹ 6,68,52,860 in the assessment completed under S. 143(3) read with S. 147, vide order dated 30.12.2011. 4. Against the order passed by the Assessing Officer under S. 143(3) read with S. 147, an appeal was filed by the assessee before the learned CIT(A) challenging inter alia the value of the property determined by the DVO at ₹ 15,99,81,4000. During the course of appellate proceedings before the le ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt by the Assessing Officer on 30.12.2011 and since the same was not available at the relevant time, it could not be filed before the Assessing Officer. Keeping in this submission made by the learned counsel for the assessee, we are of the view that the learned CIT(A) should have admitted the additional evidence filed by the assessee in the form of letter dated 20.1.2012 issued by the General manger, A.P. Infrastructure Corporation Ltd. During the course of appellate proceedings before the Tribunal, the assessee has also filed a copy of letter dated 1.4.2009 addressed by the Executive Director, APIIC to the Principal Secretary to Government MA UD Department clarifying that the land can only be used for industrial purposes, as additional evidence with application seeking admission thereof. The Learned Departmental Representative has strongly opposed to the admission of this additional evidence by pointing out that the letter dated 1.4.2009 having been available with the assessee at the relevant time during the assessment proceedings, the same should have been filed by the assessee before the Assessing Officer. The learned counsel for the assessee, however, has submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... luation on the rate fixed by the APIIC. But, in framing the Valuation Report, the Valuation Cell has inflated the value in the following manner for the reasons mentioned below: It was brought to the notice of the Valuation Cell that APIIC has fixed the prices of the plots at a uniform rate irrespective of the size, shape and location of the plots in that area. The Valuation Cell adopted the parameters of size, shape and location and closer to the main road without any documentary evidence for the enhancement of the values fixed by APIIC. It looks as if the Valuation Cell adopted these parameters only to bring the value of the plots approximately near to the value fixed in the original reference to the Valuation Cell..... This inflation is without any basis except the surmises of the District Valuation Officer. We made enquiries in APIIC and we were informed that APIIC had not charged prices comparable to the rates fixed by the Valuation Cell in any case for the plots in the industrial estate.... We request the Income Tax Officer to accept the sale consideration of ₹ 9,06,00,000 as full value of the consideration in computation of Capital gains of our firm for the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... parameters taken into account by the Valuation Cell. 4. The Valuation Cell misguided itself in enhancing the values by percentages whereas it should have considered the base price by APIIC for that industrial estate. 5. The learned Assessing Officer is not justified in adopting SRO value determining the capital gain. 6. Without prejudice to the foregoing contentions, it is submitted that the value taken into account for purpose of capital gain is highly excessive and arbitrary. 7. The learned Assessing Officer is not justified in charging an amount of ₹ 50,026/- as Interest U/s. 234A, ₹ 19,00,988/- as Interest U/s. 234B and ₹ 2,66,358/- U/s. 234C. 8. During the appellate proceedings, the assessee objects to the percentage of increase considered by the DVO for factors such as nearness to the main road, nearness to the residential area without any basis. The plot is meant for industrial purpose and nearness to residential area cannot give any definite advantage warranting 100% - 125% increase in value. The value adopted/increased from the rate fixed by APIIC @ ₹ 3,000 per sq. yard has no basis whatsoever. The assessee further relied o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ward No. 7, Block No. 2, Sanatnagar, Hyderabad, is fixed at ₹ 12,86,44,000 (Rupees Twelve crore Eighty Six lakh forty four thousand only). The tabulated figure is as follows:- 10. I have considered the assessment order, the submissions of the assessee and the material placed before me. The basic premise on which the DVO has increased the value over and above the rate fixed by APIIC is that the rate is applicable even for the plots in most disadvantageous location and the assessee's plot is in a highly advantageous location. The above proposition is without any basis. The rate fixed by the Government takes into account all the factors and is fixed for a plot of normal location. Though it is applicable for disadvantageous location plots also, the same cannot be said to be fixed keeping in view such plots only. The percentage increase in value considered on account of various factors has no basis. The DVO has not quoted any comparable cases for increasing value in lieu of locational advantage. The valuation at almost 3 times the rate fixed by APIIC for Industrial plots on account of locational advantage appears far fetched. That too increase adopted is without any ..... X X X X Extracts X X X X X X X X Extracts X X X X
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