Capital gains valuation based on evidence will not be disturbed in reference proceedings unless shown to be perverse.

In capital gains computation, the Tribunal was justified in restoring the Income-tax Officer's valuation of the property where it rejected the assessee's registered valuer's report and relied on later admitted valuation evidence to infer that the asset could not have carried the same value on 1 January 1964. The valuation finding was treated as one based on evidence and, not being shown to be perverse or unsupported by material, was not open to interference in reference proceedings under section 256(2). The matter was also clarified not to involve a reference under section 55A, and no question was directed to be referred.

---

---

Issues: Whether the Tribunal was justified in restoring the Income-tax Officer's valuation of the property for capital gains purposes and whether the finding could be interfered with in a reference under section 256(2) of the Income-tax Act, 1961.

Analysis: The dispute concerned the value of the asset as on 1 January 1964 for computing capital gains. The assessee relied on a registered valuer's report, but the Tribunal rejected that valuation and restored the Income-tax Officer's estimate. The Tribunal drew support from the admitted later valuation of the property in 1977, from which it inferred that the property could not have carried the same value in 1964. The finding was held to be one based on evidence and not open to interference as a finding unsupported by material. The Court also clarified that the matter was not one where a reference had been made under section 55A of the Income-tax Act, 1961.

Conclusion: The Tribunal's valuation was upheld, and no question was directed to be referred.

Final Conclusion: The assessee failed to establish any legal basis for compelling a reference, and the valuation finding in favour of the Revenue was left undisturbed.

Ratio Decidendi: A valuation finding for capital gains will not be interfered with in reference proceedings where it is supported by evidence and is not shown to be perverse or without material.

---