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Case Law Details

Case Name : Visu Casement Pvt. Ltd. Vs PCIT (ITAT Ahmedabad)
Appeal Number : ITA No. 306/AHD/2020
Date of Judgement/Order : 20/10/2023
Related Assessment Year : 2015-16
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Visu Casement Pvt. Ltd. Vs PCIT (ITAT Ahmedabad)

Introduction: In the case of Visu Casement Pvt. Ltd. vs. PCIT (ITAT Ahmedabad), the Assessee challenged the order of the Principal Commissioner of Income Tax-2, Vadodara, regarding the assessment for the Assessment Year 2015-2016. The key issue revolved around the PCIT’s assertion that the original assessment under section 143(3) of the Income Tax Act was erroneous and prejudicial to revenue.

Detailed Analysis: The Assessee, a private limited real estate company, had sold a portion of land during the relevant year, resulting in a substantial long-term capital gain. The dispute arose when the PCIT examined the assessment records and found a variance in the valuation of the land as of April 1, 1981. The DVO valued the land differently than the Assessee’s registered valuer, leading to a significant disparity in indexed cost and the capital gain disclosed.

The PCIT contended that the AO’s assessment was erroneous due to this discrepancy, and the revenue’s interests were prejudiced. Consequently, the PCIT directed the AO to re-assess the case in compliance with the law, providing the Assessee an opportunity to respond.

The Assessee argued that the original assessment was valid, as the AO had reasonably considered the valuation report provided by the registered valuer. Furthermore, they highlighted that the DVO’s valuation report was received after the assessment was finalized, implying that it was not part of the assessment records and should not be considered.

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