INCOME TAX ACT, 1961

Section 50C

Capital gains - Adoption of value as per section 50C - There was downfall in value on account of shops being situated right in front of a railway bridge -

Assessee contended that lower authorities grossly erred in taking sale value as per section 50C at Rs. 11,45,000 instead of Rs. 6,75,000 as sale value ignoring value assessed by registered valuer at Rs. 6,60,880. Case of assessee was that lower authorities grossly erred in relying upon the report of DVO made on basis of CPWD rates as it is a settled law that State PWD rates should be adopted. Moreover, assessee contended that revenue did not consider the objections filed regarding report of DVO. Held: First objection relates to determination of fair market value as against DLC value and the fall in the fair market value especially due to fact that shops of assessee were situated just in front of railway bridge and due to such railway bridge, commercial value of shops came down drastically which was duly considered and addressed by DVO in its report. Therefore, there was no justifiable reason to interfere with said findings of DVO and first objection was dismissed. Regarding other objection raised by assessee for adoption of CPWD rates as against PWD rates, it was found that where shops were situated in jurisdiction of State PWD, State PWD rates should be applied for estimation of cost of construction of shops. Thus, it was directed to adopt State PWD rates for determination of cost of construction of shops.

REFERRED :

FAVOUR : Partly in assessee's favour

A.Y. : 2013-14

SUBSCRIBE FOR FULL CONTENT