The Tax Publishers2020 TaxPub(DT) 3953 (Jp-Trib)

INCOME TAX ACT, 1961

Section 50C read with Section 43CA

Where once AO referred matter to DVO for his expert opinion and latter submitted his report, thereafter AO was duty bound to follow said report and did not have any discretion in that regard and accordingly AO could not entertain any objections so raised by assessee against the valuation so determined by the DVO.

Capital gains - Full value of consideration - AO whether duty bound to follow report of DVO -

Assessee company sold a piece of land. Assessee submitted valuation report obtained from registered valuer substantiating price at which land was sold before AO. Such valuation report factored in various reasons for the lower sales value of the land vis-a-vis its DLC Value. AO referred matter to DVO in terms of section 43CA, read with section 50C(2). DVO determined value of land by simply considering its DLC value. AO considered DLC value for determining gain on sale of land and made additions accordingly. Held: Assessee didn't raise any objections before DVO where he shared preliminary estimate with assessee for reasons best known to it and has raised its objections for the first time before AO on receipt of DVO report and secondly, AO proceeded to follow report of DVO. There was no infirmity in action of DVO as assessee failed to raise any objections before him. There was also no infirmity in action of AO in following report of DVO. Once AO referred matter to DVO for his expert opinion and latter submitted his report, AO was duty bound to follow said report and did not have any discretion in that regard. AO could not entertain any objections so raised by assessee against the valuation so determined by the DVO. Therefore, contention advanced by assessee was not tenable, that AO is not always obligated to follow the report of DVO and has to apply his own independent mind to the facts and circumstances persistent to the sale transaction.

Distinguished:CIT v. Rameshwar Prasad Kacholia (DBITA 51/2014, dated 15-10-2015-Raj High Court) DCIT v. Bajaj Chemicals (2017) 59 ITR(T) 132 (Kolkata-Trib.) : 2017 TaxPub(DT) 3946 (Kol-Trib) Chandra Bhan Agarwal v. ACIT (2012) 51 SOT 440 (Kolkata) : 2012 TaxPub(DT) 2420 (Kol-Trib) ITO v. Ms. Kumudini Venugopal (2011) 48 SOT 182 (Chennai)(URO) Suresh C. Mehta (2013) 158 TTJ 821 (Mumbai-Trib.) : 2013 TaxPub(DT) 2505 (Mum-Trib)

REFERRED :

FAVOUR : Against the assessee

A.Y. :

INCOME TAX ACT, 1961

Section 14A

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