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TMI Blog2023 (3) TMI 759X X X X Extracts X X X X X X X X Extracts X X X X ..... the reopening was made on the basis of a mere change of opinion 6. For that the Commissioner of Income Tax (Appeals) failed to appreciate that the Assessing Officer erred in completing the assessment u/s.144 7. For that without prejudice to the above, the Commissioner of Income Tax (Appeals) erred in upholding the addition of Rs.13,49,975/- as long term capital gains 8. For that the Commissioner of Income Tax (Appeals) failed to appreciate that Assessing Officer did not allow the indexed cost of acquisition in arriving at the long term capital gains. 9. For that the relinquishment of property was made by the appellant in favour of Smt. R. Umadevi, since the said property was sold to the appellant by a seller who did not hold proper title of the property. 10. For that there would not arise any capital gain on relinquishment of the property since there was no proper title that was in possession of the appellant for the said property. 11. For that the Commissioner of Income Tax (Appeals) ought to have referred the matter to the Valuation Officer u/s.50C(2) 12. For that the appellant objects to the levy of interest under sections 234B and 234C." 3. The brief facts of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessable by the Stamp Valuation Authority is deemed to be full value of consideration received or accruing as a result of transfer of capital asset. Since, guideline value of the property is more than the amount of consideration received for transfer of property, the AO has rightly adopted guideline value and computed capital gains and thus, upheld additions made by the AO. The relevant findings of the CIT(A) are as under: "4. The first issue raised in the grounds of appeal relates to validity of jurisdiction for reopening the assessment u/ s 14 7. During the course of appeal proceedings the AR of the appellant submitted that the taxability of capital gains arising out of the impugned transfer, which is the reason recorded for reopening of the case, has been enquired into by the Assessing Officer during the course of original assessment proceedings. Therefore, the AR argued that there is change of opinion. The AR relied upon the following judgements: (i) Decision of the Hon'ble ITAT, Chennai in the case of Shri KR Jayaram vs. ACIT in ITA No.1698/Mds/2016 dated 17.10.2017. (ii) Full Bench decision of the Hon'ble Delhi High Court in the case of CIT vs. Usha Internation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wherein admittedly the signature of the addressee is absent. However, the Assessing Officer enclosed a copy of the acknowledgement containing the date seal of the post office wherein the date affixed appears to be 01.04.2013. The AR of the appellant pointed out that the notice was issued in April and therefore, it is barred by the limitation of the Act. 8. In this regard, it is relevant to draw the law laid down by High Court of Punjab and Haryana in the case of V.R.A. Cotton Mills (P) Ltd. vs. Union of India, 33 taxmann.com 675, wherein it was held as under: A perusal of proviso to section 143(2)(ii) contemplates that no notice under said clause shall be served on the assessee after the expiry of six months. The expressions 'serve' and 'issue' are interchangeable, as has been noticed in section 27 of the General Clauses Act, 1887. The date of receipt of notice by the addressee is not relevant to determine, as to whether the notice has been issued within the prescribed period of limitation. The expression 'serve' means the date of issue of notice. The date of receipt of notice cannot be left to be undetermined dependent upon the will of the addressee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... difference in sale consideration and FMV of Rs.13,49,975/- under the head "Capital Gain". 11. The appellant. stated in the grounds of appeal during the course of appeal proceedings that the A.O. ought to have referred the matter to the Valuation Officer u/ s 50C(2). 12. The observation of the AO and the submissions of the appellant have been carefully considered. The issue is whether the actual consideration received as a result of transfer or the value assessed by the stamp valuation authority must be taken as deemed consideration. The AO adopted Rs.17 ,49, 975/- in place of Rs.4,00,000/- in terms of Section 50C of the Act. Under Section S0C(l) of the Act, the value assessed or assessable by the stamp valuation authority is deemed to be the full value of consideration received or accrued as a result of transfer of capital asset. Under subsection (2) of Section SOC, where the assessee claims before any AO that the value adopted or assessed [or assessable] by the stamp valuation authority under sub-section (1) exceeds the fair market value of the property as on the date or transfer and; the value so adopted or assessed [or assessable] by the stamp valuation authority under sub- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cation. 6. The Ld. DR, on the other hand referring to the assessment order and dispatch register of Assessing Officer submitted that notice issued u/s. 148 of the Act, dated 31.03.2013 has been dispatched on the very same day, which is evident from the dispatch register. Further, as per the acknowledgment of Postal Department, the notice has been served on the assessee within the time allowed under the Act, which is evident from the fact that although there is no signature and date of receipt in the acknowledgment for serving 148 notice, but subsequent notice issued u/s. 142(1) of the Act, has been received by the assessee and his wife. Therefore, it can be safely concluded that notice u/s. 148 of the Act, has been served on the assessee. He further submitted that, there is fresh tangible material with the AO to form a reasonable belief of escapement of income and thus, it is not a case of change of opinion. On the issue of satisfaction, he submitted that the Ld. CIT(A), while granting approval for issue of notice has recorded his reasons for approving issue of notice and thus, the arguments of the ld. Counsel for the assessee, for no proper satisfaction by the Ld. CIT(A) is in co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in terms of provisions of section 50C(2) of the Act, and requested to refer the matter to the DVO for determination of fair market value of the property as on the date of sale. Although, the assessee has requested to refer the matter to DVO in terms of provisions of section 50C(2) of the Act, but the AO has proceeded with computation of capital gains and adopted full value of consideration in terms of provisions of section 50C(1) of the Act. In our considered view, once the assessee objects for adopting full value of consideration and requests for reference to DVO, it is the duty of the Assessing Officer to refer the matter to the DVO and find out correct fair market value of the property as on the date of sale. Since, the AO has failed to comply with the requirements of law, we are of the considered view that the issue needs to go back to the file of the AO and thus, we set aside the issue to the file of the Assessing Officer and direct the AO to reconsider the issue of computation of capital gains and also refer the matter to the DVO to determine correct fair market value of the property as on the date of sale, and decide the issue in accordance with law. 9. In the result, a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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