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Issues: (i) Whether Schedule III to the Wealth-tax Act, 1957, read with the Jaipur Development Authority regulations, applied to the valuation of the assessee's house property for assessment year 1987-88 so as to exclude valuation under Rule 8(b) read with Rule 20; (ii) Whether the Assessing Officer's reference to the Valuation Officer under section 16A was valid in the absence of adequate material.
Issue (i): Whether Schedule III to the Wealth-tax Act, 1957, read with the Jaipur Development Authority regulations, applied to the valuation of the assessee's house property for assessment year 1987-88 so as to exclude valuation under Rule 8(b) read with Rule 20.
Analysis: Schedule III was treated as procedural and machinery in nature, following the principle that valuation provisions governing procedure apply to pending matters. The opening words in the relevant proviso, referring to law "for the time being in force," were read as embracing the building regulations in force when the assessment was made. The Jaipur Development Authority regulations were held to be applicable to unbuilt land and not confined to the date of valuation, and therefore could be read with Rule 6 of Schedule III.
Conclusion: The issue was decided in favour of the assessee, and valuation under Rule 8(b) read with Rule 20 was held inapplicable.
Issue (ii): Whether the Assessing Officer's reference to the Valuation Officer under section 16A was valid in the absence of adequate material.
Analysis: The reference was made without reliable supporting material showing a proper basis for doubting the returned value. Mere newspaper reports and an unparticularised local inquiry were found insufficient for the statutory reference, especially when the assessment related to an earlier year and the assessee had supported the declared value with an approved valuer's report.
Conclusion: The reference to the Valuation Officer was held invalid, in favour of the assessee.
Final Conclusion: The valuation adopted by the departmental authorities was set aside on both legal grounds, and the assessee succeeded in the appeal.
Ratio Decidendi: Valuation provisions that are procedural or machinery in character apply to pending proceedings, and a statutory reference to a valuation officer must be supported by adequate material and recorded satisfaction.
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