TaxTMI 
TaxTMI 
2014 (2) TMI 176
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....)/2011 (arising out of I. T. A. Nos. 339(ASR)/2010 and 339(ASR)/2010) for the assessment year 2007-08, claiming the following substantial question of law : "Whether, on the facts and circumstances of the case, the hon'ble Income-tax Appellate Tribunal is justified in holding 'that the Assessing Officer was not justified in referring the matter to the DVO without books of account being rejected and, therefore, reliance placed on the report of the DVO was misconceived and the order of the lower authorities are liable to be set aside', without appreciating that even when the books of the assessee may be not so incomplete, incorrect, concocted, inaccurate and/or untrue as to be rejected outrig....
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....ons of section 69 or section 69B of the Act ?" 3. Put shortly, the facts for adjudication of the present appeal are that the assessee filed its return of income on August 6, 2007, for the assessment year 2007-08 declaring a total income of Rs. 2,010. Its case was taken up for scrutiny. The Assessing Officer found that in the balance-sheet filed along with the return, the assessee had shown investment of Rs. 5,73,000 in the land account and Rs. 47,43,576 in the building account. The Assessing Officer issued notice under section 142(1) of the Act asking the assessee to furnish the details of sources of investments but the assessee failed to furnish the requisite information. The income-tax inspector was asked to make the enquiries to ascer....
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....ing dissatisfied, the assessee filed an appeal against the order of the Commissioner of Income-tax (Appeals) before the Tribunal who, vide order dated June 13, 2011 (annexure A-3), deleted the addition made by the Assessing Officer and upheld by the Commissioner of Income-tax (Appeals) and directed the Assessing Officer to accept the returned income of the assessee. Hence, the present appeal by the Revenue. 4. We have heard the learned counsel for the appellant. 5. The point for consideration in the present appeal is whether the Revenue was justified in referring the matter to the DVO for assessing the value of land and the cost of construction of building of Chohan Resorts. The Tribunal relying upon the decision of the hon'ble apex c....
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.... of the DVO was misconceived". 9.3 From the above judgment, it is clear that the hon'ble Supreme Court has ruled that without the books of account being rejected, reference made to the DVO was not tenable. Respectfully following the judgment of the hon'ble Supreme Court in the case of Sargam Cinema v. CIT (supra), we hold that no addition can be made on the basis of report of the DVO without the books of account being rejected, wherein every expenditure relating to the construction is recorded and those books of account have not been rejected by the Assessing Officer under section 145 of the Act. Consequently, we delete the impugned addition and direct the Assessing Officer to accept the r....