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2014 (12) TMI 754 - ITAT KOLKATAConfirmation of protective assessment –Held that:- The AO replied that till date they could not find the status of substantive addition and shown ignorance - as the revenue could not point out, where the substantive addition made and what happened to the same, the appeal was kept pending since 2010 and adjourned 36 times - this appeal cannot be kept pending for ever for the fault of revenue - the protective addition is deleted because the revenue is unable to bring on record what happened to substantive addition - in case, revenue is able to show us that substantive addition has been deleted in the hands of Siliguri Prabhupada International Research Society and there is a direction that this addition should be considered in the hands of the assessee, then they may get this order recalled as per the provisions of the Act – decided in favour of assessee. Addition made on the basis of difference between investment shown by the assessee in the cost of construction of building in its books of account and cost estimated vide DVO’s report - Whether reference can be made without rejecting book results or not, to DVO for estimating cost of construction, particularly when no defects were found in books of account except disallowance of small discrepancies and other preliminary expenses being capital in nature, which were added, while completing assessment u/s. 143(3) - Held that:- Following the decision in ITO Vs. M/s. Sahul India Limited [2011 (8) TMI 1038 - ITAT KOLKATA] - there is no whisper about any discrepancy in books of account and there is no rejection of books of account by AO – the AO should not have referred the matter to the DVO for estimating cost of construction particularly when the cost of construction is fully described in the books of account. A clear finding to that effect, along with materials on which such finding is based, has to be made out and given by AO - no assessment under the first proviso to section 145(1) of the Act or under section 145(2) of the Act can be sustained if the AO has not considered and recorded a finding against the assessee as to whether he has been regularly employing a method of accounting or whether his income, profits or gains can properly be deduced from his method of accounting if he has been regularly employing a method of accounting or whether the accounts are correct and complete, and the AO’s decision on these matters is not to be a subjective or arbitrary decision but a judicial decision and cannot be accepted if there is no material to support his findings - the AO referred cost of construction to DVO without rejection of books of account, which is not as per established legal propositions – thus, the addition based on DVO’s report estimating cost of construction without rejection of books of account, as the books of account were maintained properly by assessee recording the cost of construction is set aside – Decided in favour of assessee.
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