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| The Tax Publishers2019 TaxPub(DT) 7160 (Chen-Trib) INCOME TAX ACT, 1961
Section 45
When the assessee relied on the registered valuer report and if AO was not satisfied about such claim then, the AO should have referred the matter to the DVO to ascertain the fair market value. Therefore, issue was remitted back to the AO.
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Capital gains - Computation - FMV determination -
Assessee had sold the land and the factory building. AO took indexed cost of acquisition of land by adopting guideline value as on 1988 based on Registered Valuer Report and had worked out LTCG by adopting guideline value of the property under section 50C. AO show caused to the assessee saying that why the cost of acquisition should not be arrived at based on the guideline value furnished by the SRO as on 1-2-1989. Held: Guideline value will only afford a prima facie basis to ascertain true market value. Guideline value is not sacrosanct, but only a factor to be taken note of if at all available in respect of an area in which the property transferred lies. When the assessee relies on the registered valuer report and if AO was not satisfied about such claim then, the AO should have referred the matter to the DVO to ascertain the fair market value. Therefore, issue was remitted back to the AO who shall refer the matter to DVO and proceed to determine the issue in accordance with law.
REFERRED : R. Sai Bharathi v. J. Jayalalitha & Ors. 2004 (2) SCC 9
FAVOUR : In assessee's favour by way of remand
A.Y. : 2015-16
INCOME TAX ACT, 1961
Section 45
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