TMI Blog2000 (8) TMI 259X X X X Extracts X X X X X X X X Extracts X X X X ..... he reassessment proceedings initiated under s. 148 of the IT Act, 1961, in this case." 3. The facts giving rise to these appeals are that Shri Parmanand, Shri Mahesh Kumar and Shri Vijay Kumar jointly made investment in construction of the hotel building at Mt. Abu on co-ownership basis. As per the books of accounts, such investment was shown as Rs. 3,34,132 and Rs. 1,45,868 during the previous year relevant to asst. yrs. 1986-87 and 1987-88 respectively. Initially, the assessments of the relevant years in respect of all the three assessees were completed under s. 143(1). Subsequently the AO made a reference under s. 131(1)(d) to the Departmental Valuation Officer who furnished his report on 27th March, 1989, estimating the total cost of construction at Rs. 8,61,827 out of which the amount of Rs. 5,99,916 was estimated as related to asst. yr. 1986-87 whereas the balance amount of Rs. 2,61,911 was estimated as having been incurred during the previous year relevant to asst. yr. 1987-88. Consequently, the AO considered the cost of construction shown less by the assessee as income escaping assessment and notices under s. 148 were issued to all the three assessees. Finally the assessm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt in the case of Brig. B. Lal and submitted that the ratio of this decision very clearly applies to the facts of these cases notwithstanding the issue being raised either under the WT Act or IT Act. He also referred to the decision of Tribunal, Jaipur Bench in ITA No. 1587/Jp/1992, dt. 19th April, 1997, involving the facts and circumstances as also the ground which were similar to that of the instant cases wherein the Tribunal held that the ratio of decision of Hon'ble jurisdictional High Court in the case of Brig. B. Lal is fully applicable to the cases under the IT Act also involving similar facts and circumstances. He also submitted that reference under s. 131(1)(d) of the IT Act can only be made while trying a suit and not in a completed suit. He, therefore, contended that the AO was not authorised to make such reference in the instant cases wherein the assessments were already completed. He further submitted that the valuation report obtained from the DVO was just an opinion and should not have been used by the AO as information for reopening the assessment. He further contended that the CIT(A) had rightly cancelled the assessments made in the instant cases and accordingly t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) in a case where the value of the asset as returned is in accordance with the estimate made by a registered valuer, if the WTO is of the opinion that the value so returned is less than its fair market value; (b) in any other case, if the WTO is of the opinion- (i) that the fair market value of the asset exceeds the value of the asset as returned by more than such percentage of the value of the asset as returned or by more than such amount as may be prescribed in this behalf; or (ii) that having regard to the nature of asset and other relevant circumstances, it is necessary to do." "131. Power regaining discovery, promotion of evidence, etc. (1) The ITO, AAC and CIT shall, for the purposes of this Act, have the same powers as are vested in a Court under the CPC, 1908 (5 of 1908), when trying a suit in respect of the following matters, namely: (d) issuing commissions." As far as issuing of commissions is concerned provisions are contained in O. XXVI of CPC, 1908 and relevant portion of the same is reproduced here for ready reference. Commission to make local investigations- In any suit in which the Court deems a local investigation to be requisite or proper for the pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision cited by the learned counsel of the assessee: CIT vs. Smt. Prem Kumari Surana "no proceedings under s. 147(b) of the Act could be initiated on the basis of valuer's report. It is only an information which, without being substantiated by convincing evidence or circumstances, could not be the basis for reopening of an assessment order" "valuation report did not constitute information under cl. (b) of s. 147 of the Act and as such the same cannot be a valid basis for reassessment". Brig. B. Lall "The Valuation Officer's report under s. 16A can neither constitute information within the meaning of s. 17(1)(b) nor provide a reason for the belief that income has escaped assessment due to the assessee's failure to disclose material facts under s. 17(1)(a). Smt. Amala Das vs. CIT "On the basis of the valuation report, the petitioner cannot possibly be accused of not fully and truly disclosing the facts at the time of assessment as, to my mind, this report is nothing more than a mere opinion about the cost of construction or the fair market value of the building in question. As has already been indicated, mere change of opinion cannot possibly be any ground for the IT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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