TMI Blog2013 (7) TMI 204X X X X Extracts X X X X X X X X Extracts X X X X ..... hereby quashed and set aside and the proceedings are restored back to the file of ITAT, Nagpur for taking decision a fresh therein, in accordance with law - Following decisions of Amiya Bala Paul .vrs. Commissioner of Income Tax, Shillong [2003 (7) TMI 4 - SUPREME Court] and Commissioner of Income Tax .vrs. Smt. Prem Kumari [1983 (1) TMI 46 - ALLAHABAD High Court] - Decided in favour of Revenue. - Income Tax Appeal No. 35 of 2010 - - - Dated:- 3-7-2013 - B. P. Dharmadhikari And A. S. Chandurkar, JJ. For the Appellant : Anand Parchure, Advocate For the Respondent : Mr. C. J. Thakkar, Advocate JUDGMENT (Per B.P. Dharmadhikari, J) Heard Shri Anand Parchure, learned Counsel for the appellant - Department and Shri C.J. Thakkar, learned Counsel for respondent - Assessee. As we find a substantial question of law arising in the matter, and parties agree to immediate final disposal, we proceed to Admit the matter on the following as substantial question of law. (c) Whether on the facts and in the circumstances of the case, the ITAT is correct in law, in rejecting the Valuation Officer's report without providing an opportunity of being heard to the Valuation Of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrived at after making allowances for various encumbrances attached to the subject property. It rejected the valuation arrived at by the Valuation Officer after noting that the Valuation Officer treated stamp duty valuation as base rate, instead of actual sale instance value. It is this order dated 03.07.2009, that has been questioned before us by the appellant - Department. Relevant discussion in this respect is contained in paragraph nos. 8 and 9 of the judgment of ITAT. Paragraph no.5 of the said judgment shows the contentions of assessee. In view of the question of law framed by us above, we do not find it necessary to go into said contentions. The ITAT, has in paragraph no.8 found that the Valuation Officer did not consider the sale instance cited by the assessee and accepted the stamp duty valuation as base. It, therefore, discarded the valuation report of District Valuation Officer. It also observed that though such report is binding on Revenue Authorities, it is not binding on the Tribunal and for said purpose it relied upon the Division Bench judgment of Allahabad High Court reported at 146 (1984) ITA 191 (All) (Commissioner of Income Tax .vrs. Smt. Prem Kumari). In paragr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1957 apply with necessary modifications to such reference. 7. Before proceeding further we may point out that the Division Bench of Allahabad High Court in the case of Commissioner of Income Tax .vrs. Smt. Prem Kumari (supra), has delivered a judgment on 31.01.1983 when this provision was not in existence. The said Division Bench was looking into the acquisition proceedings initiated under Section 269D of the Income Tax Act, 1961 on transfer of property. The Division Bench has found that the valuation relied upon by the IAC and determined by the department valuer was arrived at on land and building method. Appeals of assessee against said exercise of IAC were allowed by ITAT and then the Commissioner preferred two appeals before the High Court. The High Court has considered the question - whether Income Tax Tribunal committed any error of law in ignoring the report of department valuer and in holding on the basis of examples, that the apparent value was fair market value ? It found that accepting valuers report was not illegal and no interference by High Court was called for. High Court held that the opinion of the skilled witness is admissible, but, not binding on the Court or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he value which he proposes to estimate and giving assessee an opportunity. Subsection (5) contemplates hearing of evidence produced by the assessee, its consideration by the Valuation Officer and passing of an order in writing by him estimating the value of asset. Again copy of such order is required to be sent by him to the assessing officer and to the assessee. Subsection (6) stipulates that on receipt of such order of Valuation Officer, the assessing Officer has to proceed to complete the assessment in conformity with the assessment of the Valuation Officer. It is therefore, apparent that these provisions mandate that after the assessing officer receives report of Valuation Officer under Section 50C, he has to act in conformity with the valuation of the capital asset worked out therein. 10. Section 23A of the Wealth Tax Act appears in ChapterVI dealing with Appeal, Revision and Reference. Section 23 speaks of Appeals to the Deputy Commissioner (Appeals) from orders of Assessing Officer under Wealth Tax Act. Section 23A gives list of appealable orders. Clause (i) of subsection (1) thereof, is about objection to any order of the Valuation Officer enhancing the valuation of an as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of books of account and other documents; and (d) issuing commissions. Subsection (3) enables the Valuation Officer to impound and retain in its custody any books of account or other documents . Under subsection (4) proceedings before Wealth Tax Authority or any Tribunal are deemed to be judicial proceedings within the meaning of Section 193 and Section 228, and for the purpose of Section 196 of Indian Penal Code. 11. When these provisions are looked into in the background of the judgment of Hon'ble Apex Court in case of Amiya Bala Paul .vrs. Commissioner of Income Tax, Shillong (supra), it follows that such valuation officer is constituted as an independent distinct statutory forum for resolving the controversy regarding determination of the market value of the property with all necessary powers. Its order or report is made binding on the assessing officer and thus he enjoys equivalent status. As per the statutory scheme when the report /order of Valuation Officer under Section 50C(2) is objected to by assessee, the CIT (Appeals) or ITAT are obliged to extend an opportunity of hearing to such Valuation Officer. Perusal of order of ITAT, particularly paragraph no.5 reveals cont ..... X X X X Extracts X X X X X X X X Extracts X X X X
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