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2014 (12) TMI 303 - HC - Income TaxValidity of reopening of assessment u/s 147(b) Report of DVO regarding the value of the cost of the construction in progress can be treated as information or not for the income tax purpose Held that:- Wealth Tax Act is concerned with the valuation of properties and contains provision for referring the matter of valuation to the DVO - However, under the Income Tax Act, the income has to be determined as per the books of accounts maintained by the assessee and there is no provision to refer the matter to the Departmental Valuation Officer - the assessee had placed all the materials before the AO at the time of original assessment, which the AO had examined - the report of the DVO would not constitute any additional information but, would merely be an opinion about the cost of construction since reopening of assessment is not contemplated under the Income Tax Act in LB. Kharawala Versus Income-Tax Officer, Company Circle-V, Ahmedabad [1983 (1) TMI 23 - GUJARAT High Court] it has been held that initiation of proceedings on the basis of the report of Valuation Officer under the Wealth Tax Act is not permissible the AO was not confronted with any defects in the books of accounts maintained by the assessee - AO has not given any valid reasons for not accepting the cost shown by the assessee though he accepts that the method of accounting was mercantile - thus, the reassessment was invalid Decided against revenue. Addition made towards the value of cost of construction u/s 69B Held that:- Following the decision in Goodluck Automobiles (P) Ltd. v. Assistant Comm. Of Income Tax [2012 (9) TMI 157 - Gujarat High Court] - wherein, it has been held that reference made by the AO to the Valuation Officer for estimating the cost of construction is invalid Decided against revenue.
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