A.O. cannot refer the matter to DVO to reduce FMV

Shri Dinesh Khodidas Patel Vs ITO (ITAT Ahmadabad)

The issue under consideration is whether A.O. is correct in referring the matter to DVO to find FMV by rejecting valuation report submitted by assessee?

In the present case, assessee sold a land along with others co-owners. It had submitted the valuation report as on 1-4-1981 of a registered valuer but AO was not satisfied with said valuation report and therefore, he called for the report of DVO. DVO determined the cost of assets as on 1-4-1981 which was materially less than the value adopted by the assessee based on registered valuer.

ITAT states that, relying on the decision of Hon’ble Jurisdictional High Court in the case of Hiaben Jayantilal Shah Vs. ITO (supra), in the case of co-sharer of the land in which the assessee was also the co-sharer, AO had no power to refer the matter to DVO in order to reduce the Faur Market Value (FMV) adopted by the assessee.

Hence, Appeal id passed in favour of assessee and capital gain based on the valuation report as on 1-4-1981 of a registered valuer is accepted.

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