Fair Market Value of property as on 01.04.1981-ITAT follows Supreme Court Guidelines and adopts value as suggested by both Revenue and the assessee
ABCAUS Case Law Citation:
ABCAUS 266 (2018) (12) ITAT
The appellant assessee was an individual. The case of the assessee was selected for scrutiny under CASS and notices u/s.143(2) and 142(1) were issued.
The assessee in his return offered long term capital gains. As per the Revenue/AIR information, the assessee sold the property, jointly held with his brothers. The Revenue obtained the copy of the sale deed was from the office of the Sub-Registrar.
To verify the claim of fair market value ( FMV ) as on 01.04.1981, a letter was addressed to the Sub-Registrar. The Revenue adopted the stamp duty value as per the registrar and that too for the land and did not consider the building.
Appellate Authority affirmed the stand of the Assessing Officer.
The assessee was aggrieved and was in appeal before the Tribunal.
The Tribunal sought the opinion with respect to valuation, from both sides, i.e. the Revenue and the assessee.
The Tribunal observed that the Hon’ble Supreme Court had indicated the methods of valuation to be adopted in ascertaining the market value of the land on the date of the notification under section 4(1) of the The Land Acquisition Act, 1894 which are as under :-
(i) opinion of experts;
(ii) the price paid within a reasonable time in bona fide transactions of purchase of the lands acquired or the lands adjacent to the lands acquired and possessing similar advantages;
(iii) a number of years purchase of the actual or immediately prospective profits of the lands acquired.
The Hon’ble Apex Court further observed that the above methods, however, do not preclude the court from taking any other special circumstances into consideration, the requirement being always to arrive as near as possible at an estimate of the market value. It was specifically observed that in arriving at a reasonably correct market value, it may be necessary to take even two or all of those methods into account inasmuch as the exact valuation is not always possible as no two lands may be the same either in respect of the situation or the extent or the potentiality nor is it possible in all cases to have reliable material from which that valuation can be accurately determined.
The Tribunal further noted that Hon’ble Jurisdictional High Court had observed that no useful purpose would be served to remand the matter and further observed it would be reasonable to fix market value of the land by averaging value given by the assessee and the assessing officer as on 01.04.1981.
Accordingly, the Tribunal adopted the value as suggested from both sides one per ground, as on 01.04.1981 as suggested by the assessee and second per ground, adopted by the CIT(A)