Reopening u/s 147 after 153A due to DVO report

[RAJESH SANGHVI]

The assessment of the builder assessee were completed u/s 153A. During asst proceedigns AO rejected books and made a reference to the DVO u/s 142A to determine cost of constructon. Wihtout DVO's report the asst made u/s 153A. The assessee won till  ITAT. Now DVO report has come in which cost of cosntruction is take 25 lacs more than what the assessee has shown. Can AO reopen based on this. Before the ITAT itwas contested that DVO reference cannot be used to determine cost of construction because 69C is not covered u/s 142A. The ITAT appreciated this point.

AI Summary

Builder's Assessment: ITAT Supports Assessee, AO Can't Reopen Based on DVO Report for Construction Costs The assessment of a builder was completed under section 153A, with the Assessing Officer (AO) rejecting the books and referring to the District Valuation Officer (DVO) under section 142A to determine construction costs. The assessment proceeded without the DVO report, and the assessee won at the Income Tax Appellate Tribunal (ITAT), which agreed that DVO references cannot determine construction costs under section 69C. A DVO report later indicated construction costs were 25 lakh more than reported. The query is whether the AO can reopen the assessment based on this report. The forum discusses the ITAT's appreciation of the assessee's argument.