TMI Blog2023 (8) TMI 80X X X X Extracts X X X X X X X X Extracts X X X X ..... uccessful bidder, of the e-tender floated by the aforesaid bank is the fair market value of the property in the facts and circumstances of the present case. Thus, we find no infirmity in the impugned order passed by the learned CIT(A), and accordingly, the same is upheld. Decided in favour of assessee. - ITA No.1304/Mum./2023 - - - Dated:- 27-7-2023 - Shri G.S. Pannu, President, And Shri Sandeep Singh Karhail, Judicial Member For the Assessee : Shri Satyaprakash Singh For the Revenue : Smt. Mahita Nair ORDER The present appeal has been filed by the Revenue challenging the impugned order dated 20/02/2023, passed under section 250 of the Income Tax Act, 1961 ( the Act ) by the learned Commissioner of Income Tax (Appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issue, as emanating from the record, are: The assessee is a firm with three partners. During the year under consideration, the assessee purchased a property in the auction from Jai Hind Co-operative Bank Ltd for Rs. 3,53,70,000. Whereas, the fair market value as per the records of the municipal authority was Rs. 5,84,99,000. Accordingly, during the assessment proceedings, the assessee was asked to show cause as to why the amount of Rs. 2,31,29,000 being the difference in the fair market value of Rs. 5,84,99,000 and the consideration of Rs. 3,53,70,000 be not considered as income from other sources under section 56(2)(x) of the Act. In response thereto, the assessee submitted that the property was purchased from the aforesaid bank after dul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that: 28. In the company matter, repeated auctions were held and it is in the negotiated bid that the higher price was obtained. It was court monitored. There would be no occasion for the court to accept the bid if it was not satisfied with the process and the valuation. A correct value of a property is the one where there is a purchaser and a seller ad idem on the price (the actual price). The market value is, thus, the value which the highest bidder is willing to pay in the facts and prevailing circumstances and not a notional price. (emphasis and italics applied) In another Para of the same order, Hon'ble Supreme Court has laid down that. 31. We are, thus, of the view that this reference is required to be answered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... auction due to the liquidation of Jai Hind Co-operative Bank Ltd. From the copy of the advertisement in the local newspaper, on page 11 of the paper book, it is evident that the first e-tender was invited by the bank on 05/04/2019 by keeping the reserved value of the property at Rs. 5,81,00,000. Since no bidder came forward to buy at this price, the bid price for the property was revised to Rs. 3,51,00,000 pursuant to the valuation report dated 01/06/2019, and a second e-tender was invited on 29/06/2019, as evident from the copy of the advertisement forming part of the paper book on page no.10. From the perusal of valuation report, forming part of the paper book from pages 12-45, it is evident that the valuer valued the property at Rs. 3,51 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the coordinate bench of the Tribunal in Krishi Utpanna Bazar Samittee v/s DCIT, in ITA No. 2043/PN/2012, vide order dated 20/03/2014, after considering the aforesaid circular issued by the Government of Maharashtra held that the consideration stated in the sale deed pursuant to the public auction is to be accepted as the fair market value. The relevant findings of the coordinate bench, in the aforesaid decision, are reproduced as under:- 10. In the present case, assessee before us is a statutory body and the sale of properties in question has been made through the route of Public auction, which is not in dispute. The CIT(A) has also reproduced the submissions of the assessee before him which inter-alia contain averments that the sale o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Act, which has to be decided on the basis of the prevailing legal position, and not on the basis of the position taken by a party. Pertinently, the purchaser of the properties are liable to bear expenses of stamp duty and it was not within the domain of the assessee and therefore assessee cannot be put to a jeopardy of invoking of section 50C of the Act merely because of the fault of the buyers of the properties. 8. Therefore, in view of the above, we are of the considered opinion that the consideration paid by the assessee, being the higher/successful bidder, of the e-tender floated by the aforesaid bank is the fair market value of the property in the facts and circumstances of the present case. Thus, we find no infirmity in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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