For computing the long-term capital gains on sale of the property, the assessee calculated the fair market value (FMV) as on April 1, 1981 at Rs.\u00a014.50\u00a0lakhs. \u00a0The Assessing Officer proposed to value the land at Rs. 7,500 per cent which worked to Rs\u00a09.30 lakhs for the entire land. \u00a0On no consensus, matter was referred to the Valuation Officer who worked out FMV at Rs. 5,33,800 (which included the cost incurred for improvement of the property).\u00a0 The CIT(A) enhanced the FMV to Rs\u00a06 lakhs thereby increasing the valuation of trees as cost of improvement by Rs. 66,200. On appeal, the Tribunal held that normally the fixation of minimum value of land is well below the FMV. \u00a0The Sub-Court had fixed land value at Rs. 8,000 per cent in 1982 and this was upheld by the High Court. Hence, Valuation Officer\u2019s report could not be taken as totally correct. \u00a0Considering the fact that Assessing Officer had initially proposed Rs. 9.30 lakhs as the FMV and this being very old case, FMV to be adopted should be Rs. 9.30 lakhs (which would include cost of improvement such as compound wall, two wells, fruit bearing trees etc) for computing long-term capital gains. (AY.1995-96)<\/p>\n","protected":false},"excerpt":{"rendered":"
S.45: Capital gains \u2014 Long-term capital gains \u2014 Transfer of land \u2014 Reference to Valuation officer \u2014 FMV as proposed by AO to be adopted for purposes of computation of capital gains [ S.48, 49 ]<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-12527","post","type-post","status-publish","format-standard","hentry","category-digest"],"acf":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p9S2Rw-3g3","jetpack-related-posts":[],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/12527","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/comments?post=12527"}],"version-history":[{"count":1,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/12527\/revisions"}],"predecessor-version":[{"id":12528,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/posts\/12527\/revisions\/12528"}],"wp:attachment":[{"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/media?parent=12527"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/categories?post=12527"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/itatonline.org\/digest\/wp-json\/wp\/v2\/tags?post=12527"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}