INCOME TAX ACT, 1961

Section 54C

Capital gains - Reference to DVO - Adoption of value declared by SRO - Assessee objected and asked for reference to DVO

Assessee had sold two immovable properties and AO observed that SRO value being higher than sale consideration mentioned in the sales deed, provisions of section 50C are applicable. Accordingly, a show cause notice was issued to assessee to which assessee replied stating that with regard to sale of property during the financial year 2010-11, there was capital loss and hence he had not disclosed the capital loss in his returns. AO however, did not accept assessee's contention and adopted SRO value of Rs. 16,38,000 for each of flat as sale consideration under section 50C and computed the long term capital gain accordingly. Held: Additional ground raised by assessee was for reference to the Valuation Officer and assessee had already raised the said objection before CIT(A), as deemed it fit and proper to admit the same and adjudicate as under. Since assessee had raised its objection to the adoption of SRO value under section 50C by pointing out certain deficiencies in property, therefore matter was remanded back to AO with a direction to refer the valuation of property to valuation cell and recompute the capital gain after giving assessee a fair opportunity of hearing including claim of deduction under section 54.

REFERRED :

FAVOUR : In assessee's favour by way of remand

A.Y. : 2011-12

SUBSCRIBE FOR FULL CONTENT