TaxTMI 
TaxTMI 
2008 (10) TMI 62
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....132(1) of the Income-tax Act was conducted on August 31, 1996 in the residential premises of Bimla Singh, appellant in M. A. No. 46 of 2002 and the late Bindeshwari Prasad Singh. On his death, M. A. No. 51 of 2002 is being pursued by his son Nawal Kishore Singh. During the search, it was found that the assessee had made huge investment in a house property at Alka Colony in the town of Patna. According to the assessees Bimla Singh and Bindeshwari Prasad Singh, they had invested a sum of Rs. 11,15,000 in construction of the house but according to the report of the valuer, cost of construction is Rs.12,99,700. 3. The Assistant Commissioner of Income-tax (hereinafter referred to as "the Assessing Officer"), gave notice to both of them and asse....
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....ovision for the margin of 15 per cent." 5. It was further contended before the Tribunal that no incriminating paper having been found during the search, on the basis of the valuer report obtained later on, no concealed income is assessable under section 158BB of the Act. This submission of the assessee also did not find favour with the Tribunal. It observed as follows. "4.2 Section 158BB dealing with the methodology of computation of undisclosed income also adds that the Assessing Officer can base the undisclosed income on such further material or information as are available with him. We had decided that such other materials will not mean any other material or all other materials. That it means any other materials which may be relevant, ....
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....stion of law formulated above at the first instance. 9. We concede to their request. 10. Mr. Rastogi submits that there is a difference of less than 15 per cent. between the amount disclosed by the assessee in construction of the house and the report of the valuer and in that view of the matter, the same was fit to be ignored. In support of the submission, he has placed reliance on the judgment of the Supreme Court in the case of K. P. Varghese [1981] 131 ITR 597 and our attention has been drawn to the following passage from the said judgment (page 615): "It is obvious that if the restrictive condition of a difference of 15 per cent. or more between the fair market value of the capital asset as on the date of the transfer and the conside....
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.... Varghese [1981] 131 ITR 597 is in relation to capital asset in the light of section 52 of the Act and that provision is deleted. However, we are of the opinion that in valuation of the house property, bona fide difference is bound to occur. In the absence of any statutory provision, no hard and fast rule can be laid down in regard to the percentage of difference, which can be ignored. It is well known fact borne out of practical experience that 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 bona fide the estimate of the value of the house is bound to vary. In the present case, we are concerned with the house property and the difference between ....