N MEENAKSHI Vs. ASSISTANT COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) The writ petition is directed against the assessment order of the respondent dated 31/12/2008 by which the respondent, having referred the matter to the Valuation Cell on 17/12/2008 as per Section 50-C(2) of the Income Tax Act, 1961 (for brevity, "the Act"), completed the assessment by invoking Section 50-C of the Act by taking the value of land as determined for stamp duty purpose as the sale value, as no valuation report was received from the Valuation Cell till the said date.

(2.) 2.1 The petitioner was the owner of a plot of land comprised in R.S. No. 3123/2, Block No. 51, Old No. 258 (New No. 849), Poonamallee High Road, Purasawalkam, Chennai. She leased out the said portion of land to the Indian Oil Corporation for more than 40 years in which the Corporation was operating a petrol bunk. The petitioner, having decided to sell the property to the Indian Oil Corporation, after negotiation, fixed the sale consideration at Rs. 99 Lakhs. Pursuant to the agreement, a sale deed was executed in favour of the Indian Oil Corporation. Since there was a capital gain on the sale, the petitioner offered the capital gains for assessment based on the actual consideration received by her, namely Rs. 99 Lakhs and paid capital gains tax. However, the Registering Authority adopted the guideline value of the property which comes to Rs. 3,92,68,800.00 and levied stamp duty and the Indian Oil Corporation which is the purchaser has also paid stamp duty on the said amount.

(3.) (1) Mr. V. Ramachandran, learned senior counsel appearing for the petitioner would submit that the Supreme Court while upholding Section 50-C(2) of the Act has kept open the issue relating to its validity. He would rely upon an order of this Court dated 22.4.2009 made in W.P. No. 2092 of 2009 in an identical situation. It is his contention that there was no opportunity given before passing such order and the order itself is without jurisdiction since at the request of the petitioner the matter has been referred for the purpose of valuation and the assessment has been passed without the valuation report.