TMI Blog1992 (2) TMI 143X X X X Extracts X X X X X X X X Extracts X X X X ..... I,New Delhifor Rs. 81,500 on perpetual leasehold basis. The assessee completed the construction of factory building thereupon by November/December 1980. 3. In the return filed for the assessment year 1981-82 relevant to previous year ending on 31-3-1981 the assessee declared the details of cost of construction of the factory building as under : Amount spent up to 31-3-1980 ---- Rs. 2,43,503 Amount spent during the year under consideration ---- Rs. 1,28,332 ------------------------- Rs. 3,71,835 ------------------------- 4. In addition to the construction account the assessee filed registered valuer's report dated27-5-1981along with the return. The registered valuer Sri A. N. Gambhir had determined the cost of construction at R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... basement and had determined the cost of construction at Rs.5,95,000 as against Rs.5,64,000 mentioned in his original report. After excluding the expenditure of Rs. 37,000 incurred in the subsequent year the ITO adopted the difference of Rs. 1,86,165 between the cost of construction as determined by the official valuer at Rs.5,58,000 (Rs.5,95,000 minus Rs.37,000) and as declared by the assessee at Rs. 3,71,835 as unexplained investment of the assessee from undisclosed sources. This time he made an addition of Rs. 1,86,165. The assessee again approached the CIT(A) in appeal. 7. The CIT(A) noted that the departmental valuer had taken the cost as in late 80's whereas the major part of building construction had taken place much prior to that. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... account books maintained in the regular course of the things are relevant admissible in evidence and, in a sense, carry with them a presumption of their correctness until the contrary is proved. Therefore, if it is proved on record that a person has maintained the record of an expenditure in the regular course of the things, such record must be given due evidentiary value and should not be lightly overlooked or rejected. Even if such an evidence is sought to be rebutted by some other admissible evidence then the worth of the two should be impartially evaluated and the more weighty should be accepted. 10. In the matter of determination of the cost of construction of a building in order to know the extent of investment made therein the ba ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, besides the doctrine of supply and demand, location, site availability of amenities, liquidity, marketability, etc., of the thing concerned. The concept of ' cost of construction ' is, therefore, altogether different from the concept of ' valuation ' of a property. In the Income-tax Act we are only concerned with the ' cost of construction ' in the context of ' investment ' made in an immovable property in a particular year than with the valuation thereof on a particular date. Therefore, it is all the more desirable that the direct evidence on ' cost of construction ' be, unless found unreliable and unacceptable, preferred to the indirect evidence on that point coming through the road of estimated valuation. 11. In the instant case it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sought to be obtained through such information. In former's own opinion about the evidentiary value of the facts informed by him would not be relevant. The person calling for the information shall have to evaluate the facts himself and then arrive at his own conclusions regarding their acceptability. In fact, it is highly doubtful if the opinion of the informant under section 133(6) would be of the same evidentiary value as that of an expert tendering advisory opinion to the ITO under section 131(d) of the Act. 13. Be that as it may, we have before us the further undisputed fact of acceptance by revenue of the same figure of Rs. 3,71,835 on account of cost of construction of the factory building up to 31-3-1980 in assessee's wealth-tax c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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