TMI Blog2006 (2) TMI 508X X X X Extracts X X X X X X X X Extracts X X X X ..... of construction was estimated by the assessee at Rs. 12,50,000 as per Registered Valuer s Report. The Assessing Officer referred the matter to the Valuation Officer. In this report, the Valuation Officer estimated the cost of construction of the building at Rs. 41,10,000. The cost of construction of godowns were estimated at Rs. 23,22,000 while the residential flats were estimated at Rs. 17,88,000. The Assessing Officer called explanation from the assesee as to why the difference of Rs. 12,50,000 should not be added as undisclosed investment under section 69B of the Act. The assessee submitted explanation before the Assessing Officer that the valuation report did not allow 7.5 per cent towards self supervision and discount in respect of pur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... v. ITO (254 ITR 714)(Mad.) 15 per cent discount from CPWD rates adopted. 4. On a perusal of the materials on record, we find that the assessee placed reliance on the decision of the Karnataka High Court in the case of CIT v. Smt. Taraben Patel ( 198 ITR 657). Although it is a case under Wealth-tax, the Hon ble High Court held that there are several methods adopted for determining the fair market value of the property. Valuation adopted on average basis has been treated as a correct method in that case. It is true that the aforesaid case may not be applicable in toto because in that case, the issue was to determine the market value of a particular property and in this case the Assessing Officer was supposed to find out the cost ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... structed the house after the date of sale. Hence, deduction under section 54F was not allowed to the assessee. CIT(A) allowed relief to the assessee and held that when the building was being constructed the assessee had no residential house. Both the flats were constructed simultaneously and for that relief cannot be denied to the assessee. 6. After hearing both the sides, we do not find any reason to interfere with the finding recorded by the Ld. CIT(A). The assessee has placed reliance on the following decisions : ( a ) CIT v. Smt. Beena K. Jain (217 ITR 363) ( b ) CIT v. K.H. Kapoor ( 234 ITR 753 )(decd.) ( c ) J.R. Subramanya Bhat (165 ITR 571)(Kar.) 7. It is a fact that when the building was being constructed by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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