ITAT Directs AO to Reconsider Rs 16.44 Lakh Capital Gains and Rs 25.87 Lakh Stamp Duty Value Addition:

The ITAT Ahmedabad Bench remanded the case of Jagdishbhai Vasharambhai Italiya to the Assessing Officer (AO) for fresh consideration. The Tribunal directed the AO to provide the assessee with a copy of the remand report, refer the land valuation dispute to the Departmental Valuation Officer (DVO), and allow him to submit evidence regarding his ownership share in jointly purchased land. The present case pertains to the Assessment Year 2015-16.

The dispute involved three additions confirmed by the CIT(A): Rs 16.44 lakh as long-term capital gains (LTCGs) on the sale of land, Rs 25.87 lakh under Section 56(2)(vii)(b) for purchasing land below its stamp duty value, and Rs 36.50 lakh under Section 69 of the Income Tax Act as unexplained investments. The assessee contended that the lands were agricultural and, therefore, the relevant provisions relating to capital assets and stamp duty valuation should not apply. Alternatively, he requested a DVO reference, claiming that the Jantri values exceeded the fair market value.

The assessee also argued that his share in jointly purchased land was 16.21%, whereas the AO had calculated it as one-third. He submitted that the authorities had rejected his claims without properly considering the evidence. His representative further argued that the AO did not provide the assessee with the AO's remand report dated May 29, 2019, which prevented him from filing a rejoinder.

After considering the submissions, the Income Tax Appellate Tribunal (ITAT) observed that the remand report had not been provided to the assessee. It also noted that the assessee's request for DVO valuation required consideration under Section 50C(2), where applicable, and that he should be allowed to substantiate his claimed ownership share.

The tribunal held that "we deem it proper to set-aside the order of the CIT(A) and restore the case to the A.O. to be decided afresh after; (i) giving the assessee a copy of the remand report dated 29/05/2019, (ii) referring the valuation of land to the DVO in cases where the assessee has contended that the stamp duty value was in excess of the fair market value and (iii) giving the assessee opportunity to produce evidence to show that his share in the jointly purchase land was 16.21% and not the one-third as adopted by the A.O."

The appeal was allowed for statistical purposes, meaning the issues remain open for fresh examination.