TaxTMI 
TaxTMI 
2010 (9) TMI 713
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....will be applicable in the case of all these appeals. The learned Departmental representative has placed strong reliance on the order of the Assessing Officer in respect to both the issues. It has been further stated that the DVO has given a categorical note in his valuation report that the assessee has not submitted vouchers except reimbursement, grit and GI pipes, etc. Hence self supervision is not considered. Therefore, the benefit allowed by the learned Commissioner of Income-tax (Appeals) at 12 per cent, on account of self supervision is without any basis. Regarding the benefit of CPWD rates, it was submitted that the DVO has prepared its report which is based on plinth area rate approved by CPWD as per Instruction No.1671 and the addition has been made on the basis of the decision of the hon'ble Rajasthan High Court in the case of CIT v. Elegant Homes P. Ltd. [2003] 259 ITR 232. On the other hand, counsel for the assessee first placed reliance on the order of the learned Commissioner of Income-tax (Appeals). It was further submitted that even no addition can be made as in the present case complete books of account have been maintained by the assessee in respect....
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.... of account and the same had been accepted in the past and no defects were pointed out in the books. The expenses were fully supported by vouchers. Full details were also mentioned in respect to each item in the books. Simply because of valuation report was of a higher amount, the books could not be said to be unreliable. The Tribunal was, therefore, justified in deleting the addition." In the case before the hon'ble High Court, the facts were that the asses-see constructed a building for which books of account were maintained. The Assessing Officer did not accept the valuation. Therefore, the matter was referred to the valuation cell who estimated the constructed value on higher value. The Tribunal deleted the addition by accepting that the asses-see has maintained complete books of account. The orders of the Tribunal have been affirmed by the hon'ble High Court as stated above. In the case of CIT v. Hotel Joshi [2000] 242 ITR 478 again the hon'ble Rajasthan High Court has held that (headnote) "in a case where the value of the asset was claimed by the assessee on the basis of regular books of account maintained for the purpose of construction of the asset and not o....
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....as not been shown in the books of account. Therefore neither the provisions of section 69 nor 69B are applicable on the facts of present case. Therefore, the provision of section 142A is not applicable. We have seen that the Assessing Officer enquired about the investment in the property and full details were filed by the assessee. A copy of letter dated May 22, 2009 is placed in the paper book where a copy of statement of housing loan financed by ICICI Bank was filed books and vouchers were also produced along with this letter. The ledger account showing house construction filed before the Assessing Officer, copy of the same is placed at pages 6 and 7 of the paper book. Copies of vouchers of expenses are also placed in the paper book. Therefore, it is amply proved that the assessee has maintained books of account for constructing the house and they were not found defective. The Assessing Officer has not commented upon in respect of maintaining books of account for the house. In view of these facts and circumstances, we hold that without rejecting books of account or without pointing out any defects in the books of account, the reference made to the DVO was not justified. A....
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.... The learned Departmental representative simply placed reliance on the order of the Assessing Officer, whereas learned counsel for the assessee placed reliance on the order of the learned Commissioner of Income-tax (Appeals). After considering the submissions and perusing the material on record, we find no infirmity in the finding of the learned Commissioner of Income-tax (Appeals). The Assessing Officer has not given any reasoning why the gross profit rate of 13 per cent. agreed by the assessee is not correct and why the gross profit rate of 14 per cent. applied by him is justified. Therefore, we hold that the learned Commissioner of Income-tax (Appeals) was justified in directing the Assessing Officer to apply 13 per cent. gross profit rate for deducing the trading income. Accordingly we confirm the order of the learned Commissioner of Income-tax (Appeals). There is no other ground in the appeal for the assessment year 2006-07. In the case of Shri Manish Maheswari in appeal for the assessment year 2005-06 there are certain other grounds which are disposed of in the following manner. Ground Nos. 1 and 2 relate to application of CPWD rate and directing to al....