Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (4) TMI 424 - AT - Income TaxAddition made u/s 69 of the Act - Unverifiable payments and stocks - Reference made to DVO u/s 142A of the Act – Difference on cost of construction – Held that:- The decision in M/s. Legend Estates Pvt. Ltd. Versus Dy. Commissioner of Income-tax, Circle-16(1), Hyderabad [2014 (4) TMI 154 - ITAT HYDERABAD] followed – No proceedings were pending at the time of reference made to the DVO, regarding ascertainment of cost of construction of the project as the return of income - for the purpose of making an assessment or reassessment under this Act, once the process of assessment is initiated, the word ‘making’ should be presumed to be associated with both ‘assessment’ or ‘reassessment’, the reference u/s. 142A of the Act can be made - When there is process of assessment, which is initiated after filing of the return of income or issuance of notice u/s. 142(1) - the process of reassessment could be initiated only after issuance of notice u/s. 148(1) after duly fulfilling the formalities mentioned, the reference u/s. 142A of the Act can be made - the invoking of Sec. 142A is a process after the initiation of the assessment proceedings. Relying upon Umiya Co-operative Housing Society Ltd. v ITO [2005 (3) TMI 382 - ITAT AHMEDABAD-B] - A reference to DVO u/s. 142A can be made only when a requirement is felt by the AO for making such reference. Requirement would arise or could be felt only when there is some material with the AO to show that whatever estimate assessee has shown is not correct or not reliable - The use of word ‘require’ is not superfluous but signifies a definite meaning whereby some preliminary formation of mind by the AO is necessary which requires him to make a reference to the DVO u/s 142A - It can only be during the course of pendency of assessment or reassessment that the AO frame his mind to refer the property to valuation cell of the Department - if there is a basis to think that the assessee may have understated the cost of construction or whatever is declared by him in this regard is not believable - reference to valuation cell u/s. 142A can be made during the course of assessment and reassessment and not for the purpose for initiating assessment –Decided against Revenue.
|