TMI Blog2013 (12) TMI 1319X X X X Extracts X X X X X X X X Extracts X X X X ..... onsequence of the search - The assessment was to be limited on the basis of the material discovered or information received in the search - The A.O. could not have referred the matter and relied upon the report of the Valuation Cell to work out the unexplained investment - The A.O. could not have referred the matter and relied upon the report of the Valuation Cell to work out the unexplained investment which could be relied upon under Section 158BB - Decided against Revenue. - Income Tax Appeal Defective No. - 203 of 2001, Income Tax Appeal Defective No. - 206 of 2001 - - - Dated:- 31-8-2012 - Hon'ble Sunil Ambwani And Hon'ble Aditya Nath Mittal,JJ. For the Petitioner : A.N. Mahajan,A.Kumar,B.J.Agarwal,D. Awasthi,G. Krishna,R.K. Upa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred to the Valuation Cell under Section 131 (1) (d) of the Income Tax Act, 1961 (in short the Act), which is the power given to the Assessing Officer for issuing commissions. The Valuation Cell estimated the cost of construction of the property at Rs.14,71,700/- as against the investment disclosed by the assessee and co-owners of Rs.5,15,093. There was discrepancy of Rs.9,56,607/-. The 1/3rd share of Smt. Neeru Agarwal, the assessee and Smt. Vimmi Agarwal, the co-owner was worked out at Rs.3,18,860/- each. 4. During the course of search a document of possession 'kabzanama' in respect of purchase of the land was also seized as per which an amount of Rs.2,60,000/- was paid in cash to the transferor of the property, over and above the disc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts as found on an enquiry conducted by himself, which results in the assessment order. A report by the Valuation Officer under Section 55A is on the other hand the outcome of an enquiry held by the Valuation Officer impose and restricts his opinion on the evidence before him. Such a report would not be the result of an enquiry by the A.O. under the provisions of Section 133 (6) or 142 (2). Though the A.O. is not bound by strict rules of evidence and report of Valuation Officer under Section 55A may be considered by the A.O. as piece of evidence, if it is relevant; however, the power of enquiry granted to an A.O. under Sections 123 (6) and 142 (2) does not include the power to refer the matter to the Valuation Officer for an enquiry ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... department has not understood the scope of Chapter XIV-B of the Income Tax Act, By no stretch of imagination, the impugned addition fell within Chapter XIV-B. There would be no finality if the department is permitted to add back to the income of the assessee on the basis of the department valuer's report obtained subsequent to the order of the regular assessment. Hence, the Tribunal was right in deleting the said addition. Accordingly, question No. 3 is answered in the affirmative i.e., in favour of the assessee and against the department. 4. For the above reasons, question Nos. 4 and 5 are also answered accordingly, in the affirmative i.e., in favour of the assessee and against the department. 5. Accordingly, the appeal is dismissed." ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the appellant assessee's assessment was being made in consequence of the search. The assessment, therefore, was to be limited on the basis of the material discovered or information received in the search. The estimates of the cost of construction arrived at by the Departmental Valuation officer, for determining the fair market value could not be relied upon by the A.O. for addition as unexplained income. 12. On the first question raised before us for consideration regarding payment of Rs.2,60,000/-, we find that the Tribunal recorded finding of fact that the document of possession (kabzanama) dated 16.1.1992 in respect of the house contained agreement with Smt. Krishna Devi, the vendor agreeing to pay Rs.2,60,000/- on her behalf to the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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