TMI Blog2019 (7) TMI 1948X X X X Extracts X X X X X X X X Extracts X X X X ..... port. In the case of CIT Vs. Gauranginiben S. Shodhan, Indl [ 2014 (2) TMI 78 - GUJARAT HIGH COURT ] has observed that if value declared by an assessee as on 1.4.1981 is more than the fair market value assumed by the AO for making a reference to the DVO, then he cannot make a reference under section 55A. In the present case, with help of DVO s report, the ld.AO wants to reduce the cost of acquisition which he cannot do. The second aspect which probably may arise is that section 55A has been amended w.e.f. 1.7.2012 and the assessment proceedings was in seisin when this amendment came. Report of the DVO was of July 17, 2016. Therefore, its cognizance can be taken, but this aspect has also been considered in the case of Shri Babulal S. Solanki [ 2019 (6) TMI 1680 - ITAT AHMEDABAD ] wherein by relying upon the judgment of Hon ble Bombay High Court [ 2014 (1) TMI 764 - BOMBAY HIGH COURT ], it has been held that this aspect is applicable on the transaction which has taken place after 1.7.2012. In the present case, the assessee has transferred his land on 8.7.2011. Since the assessee has transferred his land prior to 1.7.2012, even the amended proviso is not applicable on merit also ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a total consideration for Rs.9,57,00,000/-. As per the sale deed, the assessee had received Rs.159.50 lacs during F.Y. 2011-12. Therefore, he is liable to capital gain. On verification of records it is observed that the assessee has filed return of income for the year under consideration but has shown capital gain just for Rs.2,54,566/-. I have therefore, reason to believe that the income chargeable to tax has escaped within the meaning of section 147 of the I.T. Act, 1961. Date : 14/10/2014 Place: Ahmedabad Sd/- (PRITA M. MENON) Income Tax Officer Ward-6(5), Ahmedabad. 5. The ld.AO thereafter observed that the assessee calculated the long term capital gain by adopting cost of acquisition at Rs.14,87,267/- as on 1.4.1981 on the basis of registered valuer s report. He made reference under section 55A of the DVO who determined cost of acquisition at Rs.2,35,413/-. On the basis of DVO s report, the ld.AO has calculated capital gain assessable in the hands of the assessee. He worked out such capital gain at Rs.99,29,384/- and made addition. The working of the AO reads as u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cost of acquisition after indexation bi 14364966 ii Cost of improvement after indexation bii 0 iii Expenditure on transfer biii 0 iv Total (bi + bii +biii) biv 14364966 Balance (2 a - biv) 2c 5251701 d Deduction under sections 54/54B/54D/54EC/54F 54G/54GA 2d E Net Balance (2C-2D) 2,51,701 8. On the strength of the above details, he submitted that there is no coherence between formation of belief vis- -vis information available with the AO. On the other hand, the ld.DR relied upon the order of the AO. 9. We have duly considered rival submissions and gone through the record. A perusal of the valuation report filed by the assessee would indicate that he has disclo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer that the value of the asset shown as on 1.4.1981 was less than the fair market value. Such clause, 'therefore, as it stood at the relevant time, had no application to the valuation as on 1.4.1981. We are conscious that with effect from 1.7.2012, the expression now used in clause (a) of section 55A is is at variance with its fair market value . The situation may, therefore, be different after 1.7.2012. We are, however, concerned with the period prior thereto. Clause (b) of section 55A is in two parts and permits a reference to DVO if the Assessing Officer is of the opinion that (i) the fair market value of the asset exceeds the value of the asset so claimed by the assessee by more than such percentage of the value of the asset so claimed or by more than such amount as may be prescribed in this behalf; or (ii) that having regard to the nature of the asset and other relevant circumstances, it is necessary so to do. Sub-clause(i) of clause (b) also for the same reasons recorded above, would have no bearing on the fair market value as en 1.4.1981. The Assessing Officer had not resorted to sub-clause(ii) of clause (b). In any case, clause (b) would apply where clause(a) does no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ransaction which has taken place after 1.7.2012. In the present case, the assessee has transferred his land on 8.7.2011. The discussion made by the ITAT in this connection reads as under: 10. We have considered this decision in ITA No.2027/Ahd/2015 in the case of Shri Devendra Rasiklal Shah Vs. DCIT (supra) wherein para-8 of the Bombay High Court decision has been reproduced, which reads asunder: 8. The contention of the revenue that in view of the amendment to Section 55A(a) of the Act in 2012 by which the words is less then the fair market value is substituted by the words is at variance with its fair market value is clarifactory and should be given retrospective effect. This submission is in face of the fact that the 2012 amendment was made effective only from 1 July 2012. The Parliament has not given retrospective effect to the amendment. Therefore, the law to be applied in the present case is Section 55A(a) of the Act as existing during the period relevant to the Assessment Year 2006-07. At the relevant time, very clearly reference could be made to Departmental Valuation Officer only if the value declared by the assessee is in the opinion of Assessing Officer ..... 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