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| The Tax Publishers2021 TaxPub(DT) 2910 (Sur-Trib) INCOME TAX ACT, 1961
Section 55A(a)
Assessee while adopting value of asset had shown asset at higher rate than FMV and amendment to section 55A(a), i.e., substitution of the word 'is at variance with the Fair Market Value' were inserted in the Act with effect from 1-7-2012 and same was applicable prospectively. Since the amendment was applicable prospectively, the amendment was not applicable for the assessment year under consideration, therefore, reference made by AO was invalid.
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Capital gains - Reference to DVO - Value adopted by assessee being higher than FMV - Applicability of amendment in section 55A(a) during concerned year
Assessee sold a piece of land and while computing long-term capital gain, assessee adopted Fair Market Value (FMV) of property on the basis of valuation suggested by Government Approved Valuer @ Rs. 290 per sq.mtr. as on 1-4-1981. AO referred the matter to DVO who suggested the rate of the property as on 1-4-1981 @ Rs. 63 per sq.mtr. Assessee challenged this. Held: Assessee while adopting value of asset had shown asset at higher rate than FMV and amendment to section 55A(a), i.e. substitution of the word 'is at variance with the Fair Market Value' were inserted in the Act with effect from 1-7-2012 and same was applicable prospectively. Since the amendment was applicable prospectively, the amendment was not applicable for the assessment year under consideration, therefore, reference made by AO was invalid.
Followed:Ranchodbhai C. Patel v. ITO ITA No. 821/AHD/2016, dated 27-11-2020, CIT v. Gauranginiben S Sodhan (2014) 367 ITR 238 (Guj) : 2014 TaxPub(DT) 3200 (Guj-HC) and CIT v. Pooja Prints 360 ITR 697 (Bom).
REFERRED :
FAVOUR : In assessee's favour.
A.Y. : 2012-13
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