1992 (9) TMI 84

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..... on of a building. The petitioner is a registered firm and had constructed a hotel called "Hotel Amar ". The construction of the hotel building started in the year 1981 and was completed in the year 1983. The investment made by the petitioner in different assessment years in constructing the hotel building was indicated by the petitioner and, ultimately, an assessment was made by the Income-tax Officer under section 143(1) of the Income-tax Act and the investment made was accepted by the Income-tax Officer. The assessee had also furnished the valuation of the house made by a registered valuer. In 1987, in the course of taking up the assessment proceeding of the petitioner, the Income-tax Officer being of the opinion that the valuation of t .....

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..... the Valuation Officer and the consequent report of the Valuation Officer must be held to be without jurisdiction. Mr. Ray, learned standing counsel for the Department, though he concedes that section 55A, in terms, cannot have any application to the facts and circumstances of the present case as no capital gain is involved, contends that the power of the Income-tax Officer to hold such enquiry as he deems fit and necessary while reopening an assessment proceeding is wide enough under the Act and, in exercise, of that power, if the Income-tax Officer takes the assistance of a Valuation Officer for valuing the building of the assessee, the said report is merely an item of evidence and no infirmity can be found in holding such enquiry and ob .....

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..... a definite statutory effect and, therefore, unless the conditions precedent for making such reference are satisfied in exercise of his general power of enquiry, the Income-tax Officer cannot make a reference under the said provision. As has been stated earlier and as conceded by learned standing counsel for the Department, in the facts and circumstances of the case, no question of capital gain arises and, therefore, invoking the jurisdiction of the Valuation Officer under section 55A was wholly inappropriate and, in fact, no reference could have been made. In that view of the matter, the valuation report obtained from the Valuation Officer cannot be said to be a valuation made in exercise of power under section 55A of the Act and, to such .....

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