TaxTMI 
TaxTMI 
2019 (7) TMI 88
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....IT(SS) A. No.107/Mds/2003, dated 19.10.2006 for the assessment block period from 01.04.1989 to 31.03.2000. 2. The appeal has been admitted on the following substantial questions of law: "1. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal is right in law in confirming the addition sustained by the Commissioner of Income-tax (Appeals) in respect of the cost of construction of the residential building? 2. Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal is right in coming to the conclusion that the investment in the house property represents undisclosed income and is liable to be included in the block assessment?" 3. We have heard Mrs.Shree Lakshmi V....
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....he arguments advanced by learned counsel for the assessee contending that there was no incriminating material found during the search with reference to the valuation of the property, such contention was never raised before the Commissioner of Income Tax (Appeals) or before the Tribunal and the assessee should not be permitted to canvas the said contention. It is the further submission of Mr.T.R.Senthil Kumar, learned Senior Standing Counsel that before the CIT(A), the assessee had produced the cash flow statements and certain reconciliation was done and partial relief was granted to the assessee by the CIT(A). Therefore, it would be too late for the assessee now to contend that there was no incriminating material found during the search wit....
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....decision of the Delhi High Court in Commissioner of Income Tax Vs. Ravi Kant Jain reported in 250 ITR 141. The above ground was canvassed before the Tribunal as could be seen in paragraph 8 of the impugned order, where the Tribunal noted the submission of the learned counsel for the assessee. Nevertheless, the Tribunal proceeds solely on the basis that the cost of construction has been correctly arrived at by the CIT(Appeals). While doing so, the Tribunal in paragraph 11 of the impugned order points out that, when a person is dealing with his personal affairs, it is not expected of him to record all transactions in mercantile system of accounting and there was no need to record the expenditure towards construction of house and reflect the l....
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....99, pursuant to the inspection conducted on 12.08.1999. This valuation report was prepared after the search was conducted in the premises of the fatherin- law of the assessee. Thus, when the assessee's premises was searched on 13.01.2000, the valuation report of the said property was very much available with the department. Thus, the assessee has not been confronted with any incriminating material recovered during the search. But the present exercise done by the Assessing Officer is based on the valuation report furnished by the Departmental Valuer, pursuant to the search conducted in the premises of the assessee's father-in-law on 12.08.1999. This fact would clearly establish that there was no incriminating material was recovered f....
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....r Chapter XIV-B, before an addition of an "undisclosed income" can be made, the Assessing Officer has to bring on record the material to show that on evidence found as a result of search there is an undisclosed income representation by credits appearing in the books of accounts. 18. In the case of Bimla Singh Vs. Commissioner of Income Tax reported in (2009) 308 ITR 0071, the High Court of Patna considered the case pertaining to a difference in the valuation of the property i.e., as stated by the assessee and that of the DVO. In the said decision, the Court had pointed out the determination of value of the house property by a valuer is generally a matter of estimate based to some extent on guess and despite utmost bonafide and the estimate....
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....ogress even at the time of inspection i.e., on 12.08.1999. Therefore, the assessee cannot be found fault that he has not filed his returns, which he had time to file till September, 2001. 22. Mr.T.R.Senthil Kumar, learned Senior Standing Counsel, would strenuously contend that the cash flow statement should have disclosed the expenditure incurred by the assessee and if the same has not been disclosed in the cash flow statements, then the Assessing Officer is fully justified in holding that there was undisclosed expenditure incurred by the assessee. 23. We would have appreciated such contention, had it been a case of regular assessment. However, we are dealing with a case where it is a block assessment pursuant to a search and we are guide....