TMI Blog2010 (5) TMI 681X X X X Extracts X X X X X X X X Extracts X X X X ..... d in these appeals read as under : "1. Whether on the facts and in the circumstances of the case and in law, learned CIT(A) was justified in cancelling the assessment orders passed under section 144 of the IT Act in the case in which notice under section 148 was issued on the basis of DVO s report to complete the assessment under scrutiny for the first time. 2. Whether on the facts and in the circumstances of the case and in law, learned CIT(A) was justified in cancelling the assessment orders in view of the order passed by the Hon ble High Court of Allahabad in the case of Fusion Electronics (P.) Ltd. in Writ Petn. No. 11055 (MB) of 2009 by applying the ratio laid down in the cases of CIT v. Suresh Kumar L/H of Siri Ram [2005] 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unearth the undisclosed investment made by the assessees in immovable property in the earlier years and in future, it shall certainly become a kind of most safe investment of concealed income to avoid taxation." 2. The facts related to this case, in brief, are that the assessee filed the return of income for the assessment year 2002-03 on 21-10-2002 showing income at Rs. 91,122 and for assessment year 2003-04 return was filed on 19-12-2003 declaring income at Rs. 1,37,216. The Assessing Officer initiated proceedings under section 148 of the IT Act, 1961 (in short, the Act) on the basis of DVO s report who had worked out investment more than the amount shown by the assessee in the books of account. In the assessment year 2002-03, the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e processed under section 143(1) of the Act. Therefore, the cases were rightly reopened under section 148 of the Act since the investment in house property declared by the assessee was less than the valuation made by the DVO. Reliance was placed on the judgment of Hon ble Allahabad High Court in the case of Smt. Shashi Jain v. ITO [1997] 228 ITR 682 (All.). 5. In his rival submissions the learned counsel for the assessee strongly supported the order of the learned CIT(A) and further submitted that the Assessing Officer reopened the assessment under section 148 of the Act solely on the basis of DVO s report and did not apply his own mind, therefore, the reopening under section 147 by issuing the notice under section 148 of the Act wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. ITO Ors. [2001] 170 CTR (Cal) 192 : [2001] 250 ITR 619 (Cal.) has held as under : Valuation is always a question of opinion and unless there is a clear finding on the basis of the material that the assessee has invested in the construction more than what has been shown by it in the course of assessment proceedings, the ITO cannot proceed merely on the basis of the valuation report of the Departmental Valuer. 8. In the instant case as there was no investment in the assets by the assessee in the year for which notice under section 148 was issued so the reopening, only on the basis of report of the DVO, was not valid. 8.1 Similarly the Hon ble Punjab Haryana High Court in the case of CIT v. Suresh Kumar L/H of Siri Ram [20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r issue the Hon ble jurisdictional High Court in the case of Fusion Electronics (P.) Ltd. ( supra ) observed as under : "From the record, it appears that the assessee has constructed a factory which was completed within three years. On the basis of the DVO s report, which was sought during the previous assessment year, the Assessing Officer has made the addition in the earlier assessment year but the same was deleted by the CIT(A). However, during the assessment year under consideration, impugned notice for reopening the assessment was issued along with the reasons which were solely based on the DVO s report. It may be mentioned that as per the ratio laid down in the case of CIT v. K. Rajapandian [2009] 311 ITR 477 (Mad), it was obs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... must form a belief thereon. In the circumstances, there is no merit in the civil appeal. The Department was not entitled to reopen the assessment. Civil appeal is accordingly, dismissed. No order as to costs." 6.3 We, therefore, keeping in view the ratio laid down by the Hon ble apex Court in the aforesaid referred to case", are of the confirmed view that the learned CIT(A) was fully justified in cancelling the order passed by the Assessing Officer under section 144 r/w section 147 of the Act. 6.4 As regards to the judgment of Hon ble jurisdictional High Court in the case of Smt. Shashi Jain ( supra ), heavily relied upon by the learned Departmental Representative, it is noticed that in the said case, the valuer had not given oppo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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