| The Tax Publishers2020 TaxPub(DT) 0064 (Ahd-Trib) : (2020) 182 ITD 0327 INCOME TAX ACT, 1961
Section 142A Section 55A
In view of the fact of assessee having discharged its primary onus to support FMV as on 1-4-1981, jurisdictional defect on AO's part in issuing firstly unlawful reference under section 142A and secondly, adopting FMV as per valuation order passed under a wholly different section, i.e., 55A in gross contradiction of mandate was prima facie not curable and valuation report of RV could not be treated as unworthy of acceptance.
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Capital gains - Reference to DVO - Assessee adopted FMV as on 1-4-1981 as cost of acquisition of property sold - AO made reference to DVO under section 142A and DVO passed order under section 55A
Assessee sold certain property and fair market value (FMV) as on 1-4-1981 as cost of acquisiton. As supported by valuation certificate from Registered Valuer (RV). AO disputed FMV adopted by assessee as on 1-4-1981 and invoked section 142A and made reference to District Valuation Officer (DVO) who issued notice upon assessee, however, by invoking section 55A. DVO passed a draft Order, dt. 8-3-2016, however inexplicably under section 50C and AO eventually adopted reduced FMV as on 1-4-1981 as determined by DVO.Held: Power to make reference under section 142A is not general but is restricted to matters concerning sections 69,69A or 69B and subject-matter of examination under section 69, 69A or 69B is understatement of value of investments. In the instant case, AO impugned overvaluation in contrast to undervaluation was apparently outside the confines of sections 69, 69A or 69B. Also, RV had adopted reverse calculation of indexation which method has been approved by Tribunal in various cases and could not be brushed aside in a light hearted manner in the absence of any compelling reasons and report framed by the RV could not be summarily deemed as a spurious document or something from anybody from the street. Further, AO had merely issued reference to DVO under section 142A without any background or reasons and DVO in turn, acted in a perfunctory manner and travelled beyond jurisdiction mandate conferred within the sweep of section 142A and passed order under section 55A without any reference therein. In totality, action of AO was seriously marred by multiple and intrinsic legal infirmities and violation of principles of natural justice and, therefore, AO was directed to restore claim of assessee.
REFERRED :
FAVOUR : In assessees favour.
A.Y. : 2013-14
IN THE ITAT, AHMEDABAD BENCH
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