| COURT: | ITAT Delhi |
| CORAM: | I. C. Sudhir (JM), Inturi Rama Rao (AM) |
| SECTION(S): | 48 |
| GENRE: | Domestic Tax |
| CATCH WORDS: | capital gains |
| COUNSEL: | Prakash Chand Yadav |
| DATE: | September 28, 2015 (Date of pronouncement) |
| DATE: | October 9, 2015 (Date of publication) |
| AY: | 2009-10 |
| FILE: | Click here to download the file in pdf format |
| CITATION: | |
| S. 48: In computing "capital gains" the AO is not entitled to substitute the "market value" for the actual "consideration" received by the assessee. He also cannot disregard the valuation report without cogent material | |
(i) It is settled position of law that in the case of sale, the Assessing Officer has no power to replace the value of the consideration agreed between the parties. In this regard, we find strength from the above cited decision of Hon’ble Delhi High Court in the case of Nilofar Singh holding that the expression “full value of consideration” used in section 48 of the Act does not have any reference to market value (Nilofer Singh 309 ITR 233 (Delhi); George Handorson 66 ITR 622 (S.C); Gillanders Arbuthonot 87 ITR 407 (S.C) referred);
(ii) A report of a valuer is an important piece of evidence and the same cannot be discarded without there being any cogent material on record showing that the report of the valuer is not correct (S.K. Construction & Co. 167 Taxman 171 (Delhi) followed);
(iii) As the expression “full value of consideration” in section 48 of the Income-tax Act, 1961 does not have any reference to market value, the Assessing Officer was having no power to replace the value of the consideration agreed between the parties with any fair market value or estimation. Only because the Pioneer Ltd. had shown the book value of shares at the rate of Rs.3.50 per share, the Assessing Officer was not justified to ignore the price agreed between the parties and to doubt the genuineness of the claimed loss, even ignoring the valuation report.
i agree with the court,
what these public servants understand by the sections and laws?
I sometimes wonder when one becomes a public servant whether he understands by the word ‘public’?
He perforce need understand he is the servant of the people = public, not certainly of the government of politicians, after all when a public servant comes across an absurd section he needs to get it corrected by his higher authority, if not what service he does to public please?
If he is an ‘idle’ not ‘ideal’ public servant he allows perpetuation of meaningless provisions called so called sections.
Here you see the position of section is clear that he has to assess what the seller got from buyer, not anything else.
where from he got his great ‘market value’, i sometimes wonder why government of india have these officers with such fat packets of salaries and allowances, when just computers themselves could assess more meaningfully than these so called ‘public servants’ please.
government can save a lot of tax payers’ moneys from the wasteful salary and perks expenses, after all computers can be repaired and reused if there are any breakdowns, but these so called public servants, if they cannot use their brains properly, is it not wiser to rely on computers and probability of mistakes might be one out of a million uses, that would save unnecessary litigation and other wasteful expenditure like cars , travels , rented accommodation or quarters to these ‘worthies’who would never use their brains at all sensibly , that would mean your fixed costs would just drastically fall besides variable costs too on these worthies like medical expenses, pensions what not..?
Next budget finance minister should consider on these lines and divert the saved funds for useful projects for the poorer indians who eat less and clothe less, mostly roofless, could be better looked after, i have no sympathy for idle public servants…courts might also recommend suitably in their judgements, after all court need not work on Modal commission ideas, that is left to governments as to what they do with that package or repackages..after all what we see is most irresponsible public servants day in day out in every walk of life!