2017 (9) TMI 50

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.... the challenge to the impugned order of the ITAT is essentially on the ground that the ITAT erred in affirming the order of the Commissioner of Income Tax (Appeals) ['CIT (A)'] as regards the additions made to the return of income of the Assessee for the AY in question on re-assessment under Section 147/148 of the Act on the basis of a valuation report submitted by the District Valuation Officer ('DVO') pursuant to a reference made to him under Section 55A of the Act. 4. The background facts are that during the AY in consideration, the Assessee sold a residential property at Plot No. 3, Pocket-5, Block-E, Sector-7, Rohini, Delhi for Rs. 77,50,000/- by a registered deed dated 14th December, 2007. According to the Assessee, the value discl....

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.... had escaped assessment. This was followed by notices being issued to the Assessee under Section 143(2) and 142 (1) of the Act on 21st October, 2013. The Assessee, on 7th February 2014, filed objections to the reopening of the assessment. A careful perusal of these objections shows that the Assessee did not, per se, challenge the valuation report but only that there could be no re-opening of the assessment. No objection was raised about the Assessee not having received a notice from the DVO in the valuation proceedings. It was urged, on the strength of the decision in K.P. Verghese v. ITO (1981) 131 ITR 597 (SC) and other decisions, was that an addition could not be made only on the basis of the valuation report. 8. The above objections ....

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.... order, the AO noted that the re-opening of the assessment order would depend on the valuation report received from the DVO. The reference to the DVO was made by him even during the course of original assessment proceedings. The order passed by the DVO under Section 55A of the Act further reveals that the Assessee had a full opportunity of pointing out to the DVO why the value proposed by him should not be finalized. For the reasons best known to her, the Assessee chose not to participate in the proceedings before the DVO. Consequently, it is too late in the day for the Assessee to question the determination by the DVO of the fair market value of the property in question. In the circumstances of the present case where the Assessee was fully....