TaxTMI 
TaxTMI 
2017 (12) TMI 792
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....TAT, Agra in the case Shri Amol Chand Varshney Sewa Sansthan vs. Additional Commissioner of Income-Tax, Aligarh in ITA No. 198 & 199/Agra 2012 vide dated 22-03-2013. 5. Because the Id. CIT (Appeals) has failed to appreciate that the appellant has provided approved drawing, actual plan and structural drawings to the DVO as required and hence valuation of property by plinth area method is wrong and contrary to the facts. 6. Because the Id. CIT (Appeals) was not justified in confirming the addition of Rs. 78,56,381/- in valuation of property on estimated basis. 7. Because the Id. CIT (A) has failed to appreciate that the appellant had started construction of building w.e.f. 6- 01-2009 to 31-10-2010 and hence cost of construction should be bifurcated in respective assessment years." 2. The following additional grounds have also been taken: (i) Because the reference made by the Assessing Officer u/s 142A of the I. T. Act to the Valuation Officer without rejecting the books of accounts maintained is wrong, arbitrary and bad in law. (ii) Because the reference made to the Valuation Officer is wholly arbitrary and bad in law as there was no ma....
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....alue of any investment referred to in section 69 or section 69B or the value of any bullion, jewellery or other valuable article referred to in section 69A or section 69B is required to be made, the Assessing Officer may require the Valuation Officer to make an estimate of such value and report the same to him. (2) The Valuation Officer to whom a reference is made under sub-section (1) shall, for the purposes of dealing with such reference, have all the powers that he has under section 38A of the Wealth-tax Act, 1957 (27 of 1957)." 9. The extant section 142A was substituted for the erstwhile section, w.e.f. 1.10.2014. It nowhere states that it will be active respectively. 10. Moreover, this very provision, i.e., the un-amended / un-substituted section 142A has been considered in 'Goodluck Automobile (P) Ltd. vs. ACIT', 359 ITR 306 (Guj). It has been held therein as under: "From the language employed in the heading of the section as well as the opening part of the said section, it can be seen that the expression used by the Legislature is "estimate". Thus, resort can be made to the said provision by the Assessing Officer for the purpose of estimating the valu....
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....fficer may make an assessment in the manner provided under section 144 of the Act. Therefore, when the Assessing Officer records that he is not satisfied about the correctness or completeness of the accounts of the assessee, etc., the Assessing Officer can make a best judgment assessment. In other words, before proceeding to estimate the value of any investment the Assessing Officer has to record that he is not satisfied about the correctness or completeness of the accounts of the assessee. 11. At this juncture, reference may be made to the decision of the Uttara-khand High Court in CTT v. Bhawani Shankar Vyas [2009] 311 ITR 8 (Uttarakhand), wherein the court was dealing with the question as to whether the Income-tax Appellate Tribunal was justified in holding that without rejecting the books of account, the Assessing Officer was not justified in making reference to the Departmental Valuation Officer, ignoring the retrospective effect of the provisions of section 142A of the Income-tax Act ? The court held that where the Income-tax Officer while making his assessment had doubts on the correctness of the accounts submitted by the assessee, the Income-tax Officer was perfect....
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....see in returns of income. Moreover, it is apparent that the only reason for making the addition under section 69 of the Act is that there is a difference the cost of construction as determined by the Valuation Officer and as shown by the assessee. At no stage of the assessment proceedings does the Assessing Officer appear to have mentioned that the books of account are defective or that the cost of construction as shown in the books of account is not the true cost of construction. Thus, while making the reference to the Valuation Officer, the Assessing Officer has not recorded any defect in the books of account nor has he rejected the same. Except for the difference in the estimated cost determined by the Valuation Officer and the actual cost as shown by the assessee, the Assessing Officer has not brought any material on record to establish that the assessee had made any unaccounted investment in the construction of the building in question and that the books of account do not reflect the correct cost of construction. Under the circumstances, there was no occasion for the Assessing Officer to make a reference to the Valuation Officer. As held by the Supreme Court in the case of Sar....