Consolidated Finvest And Holdings Limited Vs DCIT (ITAT Delhi)
Summary: The Delhi ITAT allowed the assessee’s appeal for Assessment Year 2017-18 and held that the assessment order dated 28.09.2021 was barred by limitation. The dispute arose from the sale of a property situated at Nariman Point, Mumbai for Rs. 2,16,40,000/-, against a stamp-duty value of Rs. 2,85,80,744/-. The assessee offered the resulting gain under the head capital gains and disputed adoption of the stamp valuation as fair market value. In support, it furnished an independent Government-approved valuer’s report valuing the property at Rs. 2,13,28,000/-. The Assessing Officer nevertheless made a reference to the Departmental Valuation Officer (DVO) on 11.11.2019 and ultimately made an addition of Rs. 69,40,744/- under Section 50C of the Income-tax Act by adopting the differential stamp-duty valuation, even though the DVO’s report had not been received when the assessment was completed.
The assessee contended that the reference concerning valuation of a capital asset for Section 50C purposes was required to be made under the specific mechanism contained in Section 50C(2), rather than the general valuation provision in Section 142A. It was argued that a Section 50C(2) reference did not provide the Assessing Officer any corresponding extension of the assessment limitation under Section 153. Therefore, the assessment should have been completed by 31.12.2019. The assessee further submitted that the DVO had neither furnished the report within six months from the end of the month of reference nor provided the assessee an opportunity contemplated under Section 142A(4). Reliance was placed on N. Meenakshi Vs ACIT reported in 326 ITR 229 and Sumit Khurana Vs. ACIT reported in 14 taxmann.com 44.
