Anilkumar Dwarkaprasad Modani Vs DCIT (ITAT Ahmedabad)
In the case abovementioed ITAT Ahmedabad bench held that assessee must be granted a fair opportunity to represent its case especially in faceless proceedings where interaction is limited. It further remanded back the matter to AO after considering that valuation report by DVO was not obtained even after reference under section 50C (2), to consider the value of actual capital gain.
The assessee declared income at Rs. 65,92,970/- earning income from salaries, trading in shares and securities, capital gains, and other sources. During the assessment proceedings, the AO noted that the assessee had sold immovable properties in Jaipur. The sale consideration as declared by the assessee in respect of these properties was compared with the stamp duty valuation and found to be lower. Consequently, the AO invoked Section 50C of the Act and substituted the sale consideration with the stamp duty valuation, without valuation report from the District Valuation Officer (DVO). leading to an addition of Rs.54,99,196/- to the assessee’s declared capital gains, thereby assessing the total income at Rs.1,20,92,166/-.
On appeal, CIT (A), assessee argued that AO erred in substituting the actual sale consideration with the stamp duty value without obtaining an independent valuation report from the DVO which was not furnished by DVO within assessment limit even after the reference under section 50C (2). In the absence of the DVO report, the reliance on stamp duty valuation was unjustified and did not reflect the fair market value of the properties. Despite these submissions, the CIT(A) upheld the addition made by the AO, concluding that the reliance on the stamp duty valuation was valid in the absence of the DVO report.
