TMI Blog2014 (1) TMI 415X X X X Extracts X X X X X X X X Extracts X X X X ..... the return was not mandatory. Production of the same at the time of hearing was enough. The assessee cannot be denied a right to adduce evidence to substantiate his contention at the hearing. It was the obligation of the Income Tax Officer to indicate in his order that he passed the order after obtaining requisite approval. Since the order passed by the Income Tax Officer does not contain the requisite recital, it has to be held that no such approval was obtained. The order itself is incompetent. An incompetent order is a nullity and the point as regards nullity can be taken at any stage. It can even be taken at the stage of execution. Even if the orders imposing penalty were not set aside by us, which we propose to do, the order could not have been executed - Decided in favour of assessee. - AWT No. 4 of 2003, AWT No.5 of 2003 - - - Dated:- 30-9-2013 - Girish Chandra Gupta And Tarun Kumar Das,JJ. For the Appellant : Mr R. K. Murarka, Senior Adv. For the Respondent : Mr M. K. Agarwal, Adv. With Ms. Smita Das De, Advs. ORDER Girish Chandra Gupta, J. The appeal is directed against a judgment and order dated 18th June, 2003 passed by the Income Tax Appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .6,07,000/- as on 1.4.74 whereas the value is to be taken for the asstt. Years 1989-90 and 1990-91 as on 31.3.89 and 31.3.90 as the case may be. But assessee showed the value in his wealth tax return for the aforesaid property at Rs.6,00,000/- in both the aforesaid assessment years instead of Rs.6,07,000/-. One more thing should be highlighted here that the assessee filed his return of wealth for the asstt. Years 1989-90 and 1990-91 on 9.4.91 and 27.5.91 respectively while aforesaid property was valued by the assessee s valuer Mr. D.K. Dutta on 18.3.91 which was before the submission of wealth tax return. It is not known to the department under what circumstances the assessee failed to enclose the said valuation report along with return of wealth. Why should not this valuation report be treated as manufactured after the submission of return of wealth as because when assessee submitted the return of wealth value shown at Rs.6,00,000/-. From this it can easily be inferred that the assessee just presented an imaginary value of the property at 12B, Mandeville Gardens in his return of wealth. A/R of the assessee in his aforesaid explanation also claimed that valuation prepared by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... disclosure is based on the opinion of an expert, who is otherwise also a registered valuer having been appointed in terms of a statutory scheme, only because his opinion is not accepted or some other expert gives another opinion, the same by itself may not be sufficient for arriving at a conclusion that the assessee has furnished inaccurate particulars. Mr. Murarka also relied upon a Circular dated 7th June, 1968 issued by CBDT being Circular No.4P (LXXVI-65) for the same proposition. Clause 15 of the aforesaid circular contained, inter alia, as follows: Thus, where a taxpayer has given relevant particulars of his assets correctly and the value thereof declared by him in the return is in accordance with the valuation made by an approved valuer, the taxpayer will not be subjected to penalty for understatement of the value of any asset merely on the ground that its value has been determined in the assessment at a higher amount. In support of his submission Mr. Murarka also relied upon a Division Bench judgment of the Allahabad High Court in the case of Mohd. Farooq vs. Commissioner of Income-Tax, reported in 280 ITR 484, wherein the Division Bench opined as follows: It i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e was less than the valuation on the basis of the prescribed method which the department never did. Therefore, the finding as regards any concealment or as regards furnishing of inaccurate particulars is altogether bad. He submitted that the entire exercise was illegal. The last submission advanced by Mr. Murarka was that under sub Section 3 of Section 18 of the Wealth Tax Act the Income Tax Officer had no jurisdiction to impose penalty exceeding a sum of Rs.10,000/- without the approval of the Deputy Commissioner. The Income Tax Officer imposed penalty well above Rs.1 lakh for each assessment year without prior approval. Therefore, the order imposing penalty is in any event bad and without jurisdiction. He in support of his submission relied upon a judgment in the case of Official Trustee, West Bengal Ors., vs. Sachindra Nath Chatterjee Another, reported in AIR 1969 SC 823, wherein the following views were expressed: From the above discussion it is clear that before a Court can be held to have jurisdiction to decide a particular matter it must not only have jurisdiction to try the suit brought but must also have the authority to pass the orders sought for. Mr. Murarka ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7 ITR 276. Distinguishing the judgment in the case of C.I.T. vs. P. Mohanakala [291 ITR 278] relied upon by Mr. Murarka, Mr. Agarwal drew our attention to the judgment in the case of Union of India Ors. vs. Dharmendra Textiles Processors Ors., reported in 306 ITR 277 (SC) in order to show that the views expressed in the case of Dilip N. Shroff [supra], relied upon by Mr. Murarka is no longer good law. Mr. Agarwal contended that Part B of Schedule III to the Wealth Tax Act does not apply to a vacant piece of land. He contended that the Part B is applicable only to a vacant piece of land which is appurtenant to a building. Reverting to the point of concealment, Mr. Agarwal submitted that under Section 3 (n) and (q) of the Wealth Tax Act, there is a provision for valuation date , which is the last date of the financial year. In the present case, the valuation was made on the basis of a transaction made in the year 1974. Therefore, the fact that the assessee furnished inaccurate particulars does not need any further elaboration. He added that the valuation furnished by the assessee was Rs.6,07,000/-. Ultimately, the property was valued at more than Rs. 50 lakh and the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... defect nor has the legislature included an order without jurisdiction within the fold of Section 42C of the Wealth Tax Act. After hearing the learned counsel appearing for the parties, we are of the opinion that the questions of law which arise for determination in this case are as follows: a) Whether the immovable assets can be valued otherwise than in accordance with the provisions contained in Section 7 of the Wealth Tax Act? b) Whether on the facts and circumstances of the case, the order of the Appellate Tribunal holding that the assessee failed to file the valuer s report along with the return and ignoring the fact the said report was filed in course of assessment proceedings was based on irrelevant considerations ignoring the relevant material and therefore was perverse ? c) Whether on the facts and circumstances of the case, the Appellate Tribunal should have held that the penalty order passed by the Wealth (Income) Tax Officer under Section 18(1) of the Wealth Tax Act, 1957 without prior approval of the requisite authority under section 18(3) of the said act was void ab initio and without jurisdiction and authority of law ? d) Whether the omission to take prior ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 42C of the act does not apply to imposition of penalty. The expression other proceeding has to be construed ejusdem generis. The expression assessment cannot include imposition of penalty. The power to pass an order is a question of jurisdiction. When the requisite power was not there, the order could not have been passed. The order passed without power is a nullity which cannot be saved by invoking Section 42C. Therefore, the fourth question is answered in the negative. The submission that the judgment in the case of Dilip N. Shroff (supra) is no longer a good law has not impressed us because the Supreme Court in the case of CIT vs. Reliance Petroproducts Pvt. Ltd., [ 322 ITR 158 (SC) ] opined as follows: The basic reason why decision in Dilip N. Shroff vs. Joint CIT was overruled by this court in Union of India v. Dharamendra Textile Processors, was that according to this court the effect and difference between section 271(1)(c) and section 276C of the Act was lost sight of in the case of Dilip N. Shroff v. Joint CIT. However, it must be pointed out that in Union of India v. Dharamendra Textile Processors, no fault was found with the reasoning in the decision in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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