I objected to the stamp duty value, the Assessing Officer referred the matter and the Valuation Officer came back with a figure well above my sale price, though below the stamp value. Can I now attack the report and fall back on my declared consideration?
Not on a general objection. The Tribunal held that once the assessee herself disputed the stamp valuation and asked for a reference, and the Assessing Officer made it, the procedure under section 50C(2) was duly followed; section 50C(3) then provides that the value determined by the Valuation Officer 'shall' be taken as the full value of consideration, and the word 'shall' makes it mandatory for the officer to adopt it. The assessee cannot request a reference and then ask for the resulting valuation to be rejected because it came out higher than her own figure.
Decided by the ITAT (Shri T. R. Senthil Kumar, Judicial Member and Shri Bijayananda Pruseth, Accountant Member) on 2025-12-22, reported as ITA No. 815/SRT/2023; Assessment Year 2013-14 (ITAT Surat). It bears on section 50C, section 50C(2), section 50C(3), section 142A, section 292B, section 147, section 55A of the Income Tax Act 1961, in Capital Gains, Evidence & Burden of Proof and Assessment & Scrutiny matters.
This is the Revenue side of the section 50C(2) line and it is the risk a practitioner must price before invoking the safety valve. A reference is not a free option. Where the Valuation Officer's figure lands between the declared consideration and the stamp duty value — as it did here, Rs.96,02,700 against a declared Rs.50,00,000 and a stamp value of Rs.1,41,04,741 — section 50C(3) locks it in, and the only route out is to demonstrate a specific defect or perversity in the report itself. The order also disposes of two technical arguments that are commonly run: that a reference expressed to be under section 142A rather than section 50C(2) is invalid (it is not, because in substance it conformed with the intent of the Act and section 292B saves it), and that authorities on section 55A valuations of the 1 April 1981 cost of acquisition govern a section 50C substitution of sale consideration (they do not).
Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere.
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The assessee sold two immovable properties on 28 June 2012 for Rs.50,00,000. The stamp duty valuation was Rs.1,41,04,741. The capital gain returned was computed without applying section 50C. The assessment was reopened under section 147. The assessee disputed the stamp valuation and asked for a reference to the Valuation Officer; the reference was made, expressed as being under section 142A, and the Valuation Officer determined the value at Rs.96,02,700. The Assessing Officer adopted that figure and added the difference of Rs.46,02,700 as long-term capital gain under section 50C. The CIT(A) upheld him, recording that the assessee had herself requested the reference and that section 50C(3) mandates adoption of the Valuation Officer's value. Before the Tribunal the assessee argued that section 50C did not apply to agricultural land, that the section 142A reference was invalid and exceeded jurisdiction, that her objections to the report had not been considered, and that the report did not reflect fair market value.
The appeal of the assessee was dismissed and the CIT(A)'s order confirmed (paragraph 8). The stamp duty valuation having exceeded the declared consideration, section 50C was clearly attracted; the assessee herself disputed the stamp valuation and requested a reference, the Assessing Officer made it and obtained the report, and the procedure prescribed under section 50C(2) was duly followed (paragraph 7). The reference being expressed under section 142A did not vitiate the proceedings, because in substance and effect it conformed with the intent and purpose of the Act and section 292B applies; the Valuation Officer is a competent statutory and technical authority, no material defect or perversity in his report was demonstrated, and the word 'shall' in section 50C(3) makes it mandatory for the Assessing Officer to take the value determined by him (paragraph 7.1). An assessee cannot request a reference to the Valuation Officer and then request rejection of the valuation because it exceeded the value she had shown (paragraph 7.2).
The Tribunal treated the section 50C(2) reference as a procedure the assessee had herself set in motion and then measured the consequences by the statutory language. It rejected the section 142A objection as a technicality curable under section 292B, holding that mere technicalities cannot render an otherwise valid assessment void. It gave the Valuation Officer's report the weight of a report of a competent statutory and technical authority made after affording the assessee opportunity, and required a demonstration of material defect or perversity to displace it, which it found the assessee's general objections did not supply. It observed that although the Valuation Officer's figure exceeded the assessee's own value it was much lower than the stamp duty valuation, so no interference was warranted (paragraph 7.1). It distinguished Dashrathbhai G. Patel as concerning fair market value as on 1 April 1981 for cost of acquisition under sections 55A and 142A, and Chandrakant R. Patel as a case where the conditions of section 50C were not satisfied (paragraph 7.2).
Section 50C(3) of the Act clearly provides that where valuation is made by DVO, the value so determined 'shall' be taken as full value of consideration. The use of the word 'shall' makes it mandatory on part of the AO to consider the value so adopted by the DVO as the FMV on the date of transfer.
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Handle my notice → Ask a CA on WhatsAppNot on a general objection. The Tribunal held that once the assessee herself disputed the stamp valuation and asked for a reference, and the Assessing Officer made it, the procedure under section 50C(2) was duly followed; section 50C(3) then provides that the value determined by the Valuation Officer 'shall' be taken as the full value of consideration, and the word 'shall' makes it mandatory for the officer to adopt it. The assessee cannot request a reference and then ask for the resulting valuation to be rejected because it came out higher than her own figure. This was decided by the ITAT (Shri T. R. Senthil Kumar, Judicial Member and Shri Bijayananda Pruseth, Accountant Member) and bears on section 50C, section 50C(2), section 50C(3), section 142A, section 292B, section 147, section 55A of the Income Tax Act 1961. It is reported as ITA No. 815/SRT/2023; Assessment Year 2013-14 (ITAT Surat). This is the Revenue side of the section 50C(2) line and it is the risk a practitioner must price before invoking the safety valve. A reference is not a free option. Where the Valuation Officer's figure lands between the declared consideration and the stamp duty value — as it did here, Rs.96,02,700 against a declared Rs.50,00,000 and a stamp value of Rs.1,41,04,741 — section 50C(3) locks it in, and the only route out is to demonstrate a specific defect or perversity in the report itself. The order also disposes of two technical arguments that are commonly run: that a reference expressed to be under section 142A rather than section 50C(2) is invalid (it is not, because in substance it conformed with the intent of the Act and section 292B saves it), and that authorities on section 55A valuations of the 1 April 1981 cost of acquisition govern a section 50C substitution of sale consideration (they do not). If it applies to you, the first step is this: Before asking for a reference under section 50C(2), take a considered view of what the Valuation Officer is likely to report. If his figure will still exceed your consideration, section 50C(3) will fix it and you will have improved the Revenue's position, not yours.
The assessee sold two immovable properties on 28 June 2012 for Rs.50,00,000. The stamp duty valuation was Rs.1,41,04,741. The capital gain returned was computed without applying section 50C. The assessment was reopened under section 147. The assessee disputed the stamp valuation and asked for a reference to the Valuation Officer; the reference was made, expressed as being under section 142A, and the Valuation Officer determined the value at Rs.96,02,700. The Assessing Officer adopted that figure and added the difference of Rs.46,02,700 as long-term capital gain under section 50C. The CIT(A) upheld him, recording that the assessee had herself requested the reference and that section 50C(3) mandates adoption of the Valuation Officer's value. Before the Tribunal the assessee argued that section 50C did not apply to agricultural land, that the section 142A reference was invalid and exceeded jurisdiction, that her objections to the report had not been considered, and that the report did not reflect fair market value. The matter was decided on 2025-12-22 by the ITAT (Shri T. R. Senthil Kumar, Judicial Member and Shri Bijayananda Pruseth, Accountant Member). On those facts the ITAT held as follows. The appeal of the assessee was dismissed and the CIT(A)'s order confirmed (paragraph 8). The stamp duty valuation having exceeded the declared consideration, section 50C was clearly attracted; the assessee herself disputed the stamp valuation and requested a reference, the Assessing Officer made it and obtained the report, and the procedure prescribed under section 50C(2) was duly followed (paragraph 7). The reference being expressed under section 142A did not vitiate the proceedings, because in substance and effect it conformed with the intent and purpose of the Act and section 292B applies; the Valuation Officer is a competent statutory and technical authority, no material defect or perversity in his report was demonstrated, and the word 'shall' in section 50C(3) makes it mandatory for the Assessing Officer to take the value determined by him (paragraph 7.1). An assessee cannot request a reference to the Valuation Officer and then request rejection of the valuation because it exceeded the value she had shown (paragraph 7.2).
The Tribunal treated the section 50C(2) reference as a procedure the assessee had herself set in motion and then measured the consequences by the statutory language. It rejected the section 142A objection as a technicality curable under section 292B, holding that mere technicalities cannot render an otherwise valid assessment void. It gave the Valuation Officer's report the weight of a report of a competent statutory and technical authority made after affording the assessee opportunity, and required a demonstration of material defect or perversity to displace it, which it found the assessee's general objections did not supply. It observed that although the Valuation Officer's figure exceeded the assessee's own value it was much lower than the stamp duty valuation, so no interference was warranted (paragraph 7.1). It distinguished Dashrathbhai G. Patel as concerning fair market value as on 1 April 1981 for cost of acquisition under sections 55A and 142A, and Chandrakant R. Patel as a case where the conditions of section 50C were not satisfied (paragraph 7.2). In the words reproduced by the source cited on this page: "Section 50C(3) of the Act clearly provides that where valuation is made by DVO, the value so determined 'shall' be taken as full value of consideration. The use of the word 'shall' makes it mandatory on part of the AO to consider the value so adopted by the DVO as the FMV on the date of transfer." The decision followed or applied Dashrathbhai G. Patel — distinguished; Chandrakant R. Patel — distinguished.
It was decided by the ITAT on 2025-12-22 and is reported as ITA No. 815/SRT/2023; Assessment Year 2013-14 (ITAT Surat). Binding on the AO and CIT(A) within the Tribunal's jurisdiction. Persuasive elsewhere. A Tribunal decision binds the assessing officer and the Commissioner (Appeals) within that Tribunal's jurisdiction, and is persuasive before other benches. It is not binding on a High Court, and a contrary co-ordinate bench decision will be argued against you, so check whether the point has been taken the other way before you build a reply around it. On section 50C, section 50C(2), section 50C(3), section 142A, section 292B, section 147, section 55A, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the department, and it appears in this library for that reason — you need to know what the Assessing Officer will cite against you. The appeal of the assessee was dismissed and the CIT(A)'s order confirmed (paragraph 8). The stamp duty valuation having exceeded the declared consideration, section 50C was clearly attracted; the assessee herself disputed the stamp valuation and requested a reference, the Assessing Officer made it and obtained the report, and the procedure prescribed under section 50C(2) was duly followed (paragraph 7). The reference being expressed under section 142A did not vitiate the proceedings, because in substance and effect it conformed with the intent and purpose of the Act and section 292B applies; the Valuation Officer is a competent statutory and technical authority, no material defect or perversity in his report was demonstrated, and the word 'shall' in section 50C(3) makes it mandatory for the Assessing Officer to take the value determined by him (paragraph 7.1). An assessee cannot request a reference to the Valuation Officer and then request rejection of the valuation because it exceeded the value she had shown (paragraph 7.2). It arises in Capital Gains, Evidence & Burden of Proof and Assessment & Scrutiny matters, on section 50C, section 50C(2), section 50C(3), section 142A, section 292B, section 147, section 55A of the Income Tax Act 1961, and was decided by Shri T. R. Senthil Kumar, Judicial Member and Shri Bijayananda Pruseth, Accountant Member. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. If you do go to the Valuation Officer, engage with the valuation on specifics — comparable instances, the state and use of the property, encumbrances, access, litigation — and get those objections on record before the Valuation Officer, not for the first time in appeal. General objections were held not to dislodge the statutory mandate. To dislodge the report you must show material defect or perversity in it. Plan for that evidentially: an independent registered valuer's report addressing the same comparables is the usual vehicle. Do not build a case on the reference being made under the wrong section number. Section 292B and the substance-over-form reasoning here will defeat it. Remember the cap: section 50C(3) operates only where the Valuation Officer's figure exceeds the stamp duty value, in which case the stamp value is taken. Check that arithmetic before conceding.
Searched for later treatment; none was found. That is not the same as a source affirming it. The citator search (doc 178903979, confirmed as 'Vaishali Urvesh Mehta, Bharuch ... vs Assessment Unit, Bharuch on 22 December, 2025') returns nothing, and a second probe on the assessee's name returned only the order itself (ITAT Surat, 22 December 2025). No later Bench has taken up the s.50C(3) point that the DVO's value binds the Assessing Officer, and no appeal to the Gujarat High Court is disclosed. Nothing overruling, doubting or distinguishing it was found, and no appeal to a High Court against it is disclosed on the record searched. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
Paragraphs 7, 7.1, 7.2 and 8 were reproduced verbatim on a second, stricter fetch and the key sentence was re-read through a fragment view; a first fetch of the same page returned a condensed paraphrase and should not be relied on. The order as printed states at 7.1 that section 50C(3) provides that 'where valuation is made by DVO, the value so determined shall be taken as full value of consideration'. That is a compressed statement of the sub-section, which in terms directs the Valuation Officer's value to be taken but caps it at the stamp duty value where the officer's figure exceeds it; on these facts the Valuation Officer's figure was below the stamp value so the cap did not arise. Read the sub-section itself before applying the sentence. The decisions distinguished at 7.2, Dashrathbhai G. Patel and Chandrakant R. Patel, were not retrieved or read. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
The appeal of the assessee was dismissed and the CIT(A)'s order confirmed (paragraph 8). The stamp duty valuation having exceeded the declared consideration, section 50C was clearly attracted; the assessee herself disputed the stamp valuation and requested a reference, the Assessing Officer made it and obtained the report, and the procedure prescribed under section 50C(2) was duly followed (paragraph 7). The reference being expressed under section 142A did not vitiate the proceedings, because in substance and effect it conformed with the intent and purpose of the Act and section 292B applies; the Valuation Officer is a competent statutory and technical authority, no material defect or perversity in his report was demonstrated, and the word 'shall' in section 50C(3) makes it mandatory for the Assessing Officer to take the value determined by him (paragraph 7.1). An assessee cannot request a reference to the Valuation Officer and then request rejection of the valuation because it exceeded the value she had shown (paragraph 7.2).
TaxSphere, “Vaishali Urvesh Mehta v Assessment Unit (ITAT Surat) — having asked for the reference under section 50C(2), the assessee cannot reject the Valuation Officer's report”, https://taxnotice.vittsphere.com/caselaw/case/vaishali-urvesh-mehta-v-assessment-unit-50c-3-dvo-value-binds-the-assessee-too/ (validity last checked 2026-09-08)
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The Assessing Officer has adopted the jantri value for my land sale because a co-owner's assessment used it, even though I objected that the title was defective. Must he refer the valuation to the DVO instead?
The officer sent my property to the Valuation Officer. Does that give him extra time to finish the assessment?
The AO adopted the stamp duty value and I never asked for a DVO reference. Can he do that?
The AO has sent my cost of construction to the Departmental Valuation Officer without saying a word about my books. Can he do that?
