|
Tax Publishers
AO seeking fresh departmental FMV as on 01-04-2001
without grounds-cross examination-Sustainability thereof
Facts:
Assessee a UK resident was 1/3rd owner in a property which was inherited from
his parents then acquired in 1967/69. Fair market value from a registered
valuer as on 01.04.2001 was obtained and property was sold and capital gains
was returned on the Consideration less indexed FMV for her 1/3rd share. AO
without offering any reasons questioned the FMV as on 01-04-2001 and invoked
fresh departmental FMV valuation which turned out to be lower than the
Assessees FMV on 01-04-2001 based on two similar nearby properties that were
sold recently and computed capital gains accordingly. The AOs FMV was not
given to assessee for cross examination either. DRP sustained revised capital
gains calculations of AO. On higher appeal to ITAT assessees plea was -
1. Reason for invoking section 142A by AO to seek fresh FMV was not given.
2. Cross examination right not provided.
3. No reason or fault found with Assessees FMV.
4. Addition based only on FMV alone without reasons is illogical.
5. Other two 1/3rd share owners assessments of the same property sale did not
have similar FMV questioning and Assessees FMV was accepted at face value.
Held in favour of the assessee that the revised fresh FMV seeking adventure by
AO was unwarranted.
Applied: -
CIT v. Lasha Construction Pvt. Ltd. (2013) 357 ITR 671 (Delhi) : 2013
TaxPub(DT) 2450 (Del-HC) wherein it is held that addition cannot be made
solely on the basis of the report of the DVO.
Ed. Note: No doubt assessee won his case but the time lapse and
stay petition etc. involved besides mental agony of pursuing the case would
certainly need to be thought so as to penalise such AOs who pass orders
without any application of mind. It is high time judiciary takes some harsh
stand on this standpoint alone.
Case: Madhurittu Puri v. DCIT 2023 TaxPub(DT) 4286 (Del-Trib)
|