आदेश/ORDER

Per Dr. A. L. Saini:

The captioned two appeals filed by the assessee, pertaining to assessment year 2013-14, are directed by the separate orders passed by the Commissioner of Income Tax (Appeals)-13, which in turn arise out of the separate two assessment orders passed by the assessing officer under section 143(3) of the Income Tax Act, 1961, ( In short, the ‘Act’).

Since, the issues involved in these two appeals are common and identical; therefore, these appeals have been heard together and are being disposed of by this consolidated order. For the sake of convenience, the grounds as well as the facts narrated in ITA No.1644/Kol/2018, for assessment Year 2013-14, have been taken into consideration for deciding the above appeals en masse.

3. The solitary grievance of the assessee, as per lead case in ITA No. 1644/Kol/2018, for A.Y. 2013-14, is that the ld CIT(A) erred in upholding the addition of Rs.4,85,77,093/- on account of Long Term capital gain on sale of immovable property, and reference to Departmental Valuation Officer for the Valuation of immovable property as on 01.04.1981 be held to be bad in law.

4. The facts of the case which can be stated quite shortly are as follows: The assessee along with his other co-owners had entered into an agreement for sale with M/s Bangabhumi Housing Private Limited for sale of a property at 119 Park Street Kolkata measuring 2 Bigha and 2 Chittak and 2 Sq ft owned by them (by inheritance) which was already leased to Park Chambers Private Limited for 61 years from 24/01/1979, the lease was in force till 2040 and the monthly lease rent as on date of sale was Rs.10,000 per month. The assessee was the co owner of the property having 1/6^th share in the property. The details of all co owners are as follows:

The actual sale value as received by the assessee for the sale of his 1/6^th share was claimed to be Rs.1,50,00,000 in terms of the agreement for sale dated 12/05/2010. As the time of conveyance of the sale deed on 02/11/2012, the fair market value by the stamp authority was determined at Rs.11,16,53,494/-.

5.The assessee offered Nil capital gains in his return of income. The computation as originally adopted by the assessee was as follows:

Deemed Sale Value Rs.11,16,53,494

Less: Index Cost as per registered Valuers report Rs.14,89,68,295

Capital Loss Rs. 3,73,14,801 

In the assessment proceedings the assessee challenged the sale value u/s 50C(2) of the Act and the Ld AO referred the matter of valuation to the Ld DVO who calculated the value as follows:

As on 01/04/1981 Rs.1,10,61,171

As on date of sale (Sec. 50C(2) ) Rs.38,57,03,737 (50% share)

The Ld Assessing Officer (page 6 of assessment order) computed the capital gains as follows:

Therefore, the assessing officer made addition to the tune of Rs. 4,85,77,093/-

6. Aggrieved, by the addition made by the assessing officer, the assessee carried the matter in appeal before the ld CIT(A), who has confirmed the addition made by the assessing officer. The ld CIT(A) just reiterated the findings of the assessing officer and made addition. Aggrieved, by the order of ld CIT(A), the assessee is in appeal before us.

7. The ld Counsel for the assessee submitted before us that valuation of property should be done as per Rent Capitalization method. The ld Counsel stated that as per Schedule III of the Wealth Tax Rules, the manner of calculation for the purpose Rent Capitalization method has been laid down and defined, which is given