COMMISSIONER OF INCOME TAX Vs. MADHO PROPERTIES LTD

JUDGEMENT

(1.) The transaction involved in these appeals under Section 269H of the I.T. Act, 1961, is the transfer of premises No. 13, Gurusaday Road, Calcutta (hereinafter referred to as "the property"), comprising of 16'642 cottahs of land and a one storey structure, by M/s. Madho Properties Ltd. (hereinafter referred to as "the transferor") to M/s. Shree Co-operative Housing Society Ltd. (hereinafter referred to as " the transferee") under a deed of conveyance dated the 4th July, 1974, for a stated consideration of Rs. 14,50,000.

(2.) Earlier, M/s. Talbot & Co., Calcutta, had valued the property at about Rs. 14,22,000 and submitted a report dated the 27th September, 1973. The said valuers took into account the situation of the property, its land area, its frontage on the main road on its south abutting on an open Maidan. They also noted that the property was situated in a detached area requiring land to be left vacant in any proposed construction and that the existing structure would be demolished to utilise the land for multi-storeyed constructions. On the basis of the aforesaid they valued the land by what is known as the "belting method". The front belt value of the land up to a depth of 100 ft. was found to be Rs. 30,000 per cottah. The final computation was as follows : <FRM>JUDGEMENT_380_ITR131_1981Html1.htm</FRM>

(3.) The average land value was determined at Rs. 30,000x 0.72-21,600 per cottah which was rounded off to Rs. 22,000. The value of 16'642 cottahs was thus estimated at about Rs. 14,22,000.