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TMI Blog2012 (7) TMI 628X X X X Extracts X X X X X X X X Extracts X X X X ..... as reopened on the basis of reference to the DVO u/s 148 of the Act, but grounds No.1 and 2 of the appeal have not been pressed by the assessee, therefore, the same are hereby dismissed as not pressed. 3. Ground No.3 of the appeal of the assessee is against addition of Rs.23,16,120/- u/s 69 B of the Act as additional purchase cost of his property. The brief facts of the case are that during the year the assessee purchased flat No.1403, 14th floor in the building known as 'Vainganga' situated at Plot No.66, 66-A, vide C.S. NO.787, 1-787 at Sir Pochkhanwala Road, Worli, Mumbai 400 030 admeasuring about 950 Sq. Ft. carpet area on 6-12-2003 for a consideration of Rs.62 lacs. The said property was referred to Government Approved Valuer to know ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Report. There is wide variation between both the values determined by the experts. The DVO has considered evidences of comparable cases situated far away whereas the assessee has given comparable case of the same society. As per the learned CIT(A)'s opinion, it was reasonable to add Rs.2,3,16,120/- u/s 69B of the Act. Therefore, he deleted the balance amount of Rs.52,66,480/- from the income of the assessee. 5. Now, the revenue is in appeal before us and the learned Counsel for the assessee Shri S. N. Soparkar, Sr. Advocate filed paper book in which written reply for this addition has been submitted which is reproduced as under: "3) Grounds of appeal 3 Addition Rs.1,15,80,600/- being the difference between the valuation made by the Gove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... partment cannot place sole reliance on DVO report and make the addition of entire difference. It is not sacrosanct but an estimate by a technical person and taken in advisory capacity and as a mark of guidance. Reliance was placed on the following decisions for the proposition that if regular books of maintained, no addition can be made under s. 69B/69C only on the basis of the report of the DVO. (i) Nishant Housing Development (P) Ltd. vs. Asstt. CIT (1995) 52 ITD 103 (Pat) 27. The case law is, therefore, overwhelmingly in favour of the assessee that the cost of as per books cannot be rejected and on estimate made without first bringing the case under proviso to s. 145(1) or under s. 145(2). The case has been brought under neither of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the ITO proposes to go by the Valuation Officer's report, it means that the books of account maintained by the assessee and produced by him in support of cost of construction within the meaning of s. 143(3) of the IT Act, require specific comment to reject the material as unreliable. The ITO can only make the assessment after rejecting the evidence produced by the assessee in support of his return. The assessee can, therefore, offer the books of accounts maintained by him in support of his cost of construction. The ITO must look into that evidence and point out the defects to falsity and unreliability of these evidences. It is only after the evidence is rejected on the specific point, the ITO will get the power to estimate the cost of co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n actual cost disclosed by assessee, which was by regular books of account and vouchers, and estimate of cost of on made by DVO, particularly in a case where assessee had submitted details both in terms of quantity and value to DVO as well as AO-Held, yes. In the following decisions, it was held that when the assessee maintained accounts regularly, addition cannot be made on the basis of the report of the DVO without pointing out any in the books: (a) Shekhar Chand & Sons (1988) 32 TTJ (Del) 570 (b) Western Estate (1994) 209 ITR 343 (Cal) (c) Vindaban Chitra Mandir (1994) 209 ITR 520 (All) (d) Nishant Housing Development (P) Ltd. (1995) 52 ITD 103 (Pat.) (e) Smt. Uma Devi Jhawar: (1996) 218 ITR 573 (CAL) From the aforesaid judgments, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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