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TMI Blog2024 (8) TMI 1560X X X X Extracts X X X X X X X X Extracts X X X X ..... u/s 139(4) of the Act declaring a loss of Rs.48,74,500/-. Based on the survey conducted u/s 133A of the Act, the case of the assessee was selected for scrutiny and during the assessment proceedings, the ld. AO sent a requisition to the District Valuation Officer, Bangalore seeking the report about the cost of construction of Hotel Silver Oak International. The ld. AO has not received any valuation report from the DVO and therefore, he has completed the assessment u/s 143(3) of the Act on 27.3.2022. In the above said order, the ld. AO also mentioned that necessary rectification order would be issued on receipt of the valuation report from the DVO. After passing the order the DVO sent a letter on 15.7.2022 and informed that they were not able ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore the Tribunal and raised the following grounds of appeal: 1. The order passed by the learned Principal Commissioner of Income Tax [Central], Bengaluru, passed under section 263 of the Act in so far as it is against the Appellant is opposed to law, weight of evidence, probabilities, facts and circumstances of the Appellant's case. 2. The notice issued for initiation of proceedings under section 263 of the Act is bad in law. 3. The learned PCIT is not justified in law in invoking the jurisdiction under section 263 of the Act and setting aside the order of the learned assessing officer as being "erroneous and prejudicial to the interest of the revenue", without appreciating that the order of assessment is a reasoned order, on th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... warded their report about the cost of construction of the new hotel complex. Therefore, the ld. A.R. contended that the order of the ld. AO is a correct one and requires no interference by the ld. PCIT u/s 263 of the Act. The ld. A.R. further contended that if the DVO had submitted their valuation report before the ld. AO and the ld. AO has failed to look into the same while passing the order u/s 143(3) of the Act, then there is a case for revision u/s 263 of the Act. The ld. A.R. also argued about the other grounds on merits and also filed a paper book and also relied on the order of this Tribunal in ITA Nos.6 & 7/Bang/2021 dated 21.9.2022 for the AY 2013-14 in the case of Bashir Ahmed Abdurrahman Matte Vs. PCIT. 4. The ld. D.R. relied on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Officer under sub-section (1) whether or not he is satisfied about the correctness or completeness of the accounts of the assessee. (3) The Valuation Officer, on a reference made under sub-section (1), shall, for the purpose of estimating the value of the asset, property or investment, have all the powers that he has under section-38A of the Wealth-tax Act, 1957 (27 of 1957). (4) The Valuation Officer shall, estimate the value of the asset, property or investment after taking into account such evidence as the assessee may produce and any other evidence in his possession gathered, after giving an opportunity of being heard to the assessee. (5) The Valuation Officer may estimate the value of the asset, property or investment to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion officer has every power to estimate the value to his best judgement assessment. Therefore, even though assessee has not cooperated with the valuation officer he can make an estimation on his own and it can be sent to the ld. AO for making further proceedings. Therefore, the non-adhering to the procedures contemplated under the provisions of the Act is not a reason for ld. PCIT to invoke the provisions of section 263 of the Act. For the mistake committed by the valuation officer by not sending the valuation report to the ld. AO, we do not find that the ld. PCIT has powers to revise the assessment u/s 263 of the Act on the ground that the assessment is erroneous and prejudicial to the interest of revenue. The assessment order is not an e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the period of limitation which the AO does not have and therefore we are of the view that the provision 263 of the Act could not be pressed into service. We further held that the direction to the AO to get a fresh DVO report once again and pass a fresh assessment order is without jurisdiction. We are of the view that the ld PCIT in order to save the limitation prescribed u/s 153 of the Act had invoked the provision 263 of the Act, therefore the order of the PCIT is not sustainable. 5.2 We therefore, set aside the order passed by the ld. PCIT u/s 263 of the Act since the same is not within the purview of section 263 of the Act and also on the ground that the assessment order is not an erroneous one and also prejudicial to the interest of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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