Fair Market Value assessed by DVO to be adopted even if its lower than stamp duty valuation

0 comments Wednesday, March 14, 2012

Kolkata ITAT has held in the following case that Where fair market value assessed by DVO is lower than stamp duty valuation, value adopted by DVO has to be adopted for computing LTCG.

In this case during the relevant assessment year, the assessee sold certain property and disclosed sale consideration in the sale deed for her half share at Rs. 20 lakhs and computed long-term capital gains at nil by taking indexed cost of acquisition at Rs. 30.81 lakhs. The Assessing Officer noticed from the sale deed that the stamp valuation of the property was at Rs. 1.3 crores. The Assessing Officer adopted valuation by Stamp Duty Authorities and computed the long-term capital gain at Rs. 50.70 lakhs. On appeal, the Commissioner (Appeals) referred the matter to the DVO for ascertaining the fair market value of the said property. The Commissioner (Appeals) directed the Assessing Officer to adopt the value as per DVO's report for the purpose of computing the capital gains. The DVO valued the property at Rs. 30.87 lakhs.
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