2026 (9) TMI 376

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..... Assessing Officer [AO] u/s 143(3) r.w.s. 263 of the Act on 24.03.2023. The sole grievance of the assessee is confirmation of valuation addition of Rs. 212.09 Lacs. Having heard rival submissions and upon perusal of case records, the appeal is disposed off as under. 2. It emerges that the assessee did not file its Income Tax Return. During regular proceedings u/s 143(3), Ld. AO had made reference on 21.03.2016 to Departmental Valuation Officer (DVO) to determine the cost of investment as made by the assessee in construction of building / structure. The Ld. DVO valued the same at Rs. 12.78 Crores as against investment of Rs. 10.66 Crores as reflected by the assessee. To tax the differential amount, the case was reopened and an assessment....

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.... & Haryana High Court in the case of Shri Rajesh Mahajan (50 Taxmann.com 206) to contend that CPWD rates were higher than 30% and the benefit of personal supervision was to be allowed to the extent of 15% as against 7.5% as granted by Ld. DVO. The differential in valuation was merely 19.89%. If the benefit of 25% for CPWD rates and additional benefit of personal supervision for 7.5% was granted, there would remain no difference. However, Ld. CIT(A) endorsed the findings of Ld. AO against which the assessee is in further appeal before us. Our findings and Adjudication 5. Upon careful consideration of material facts, we find that the short issue that fall for our consideration is with regard to the addition of Rs. 212.09 Lacs as made by....

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.... estimated difference in valuation cannot automatically be sustained. 7. In the present case, the assessee had specifically relied upon the judgment of the Hon'ble Punjab & Haryana High Court in the case of Shri Rajesh Mahajan (50 Taxmann.com 206), wherein the issue regarding the difference between CPWD and PWD rates and the allowance towards personal supervision was considered. The assessee had also contended that the CPWD rates adopted by the DVO were substantially higher than the Haryana PWD rates and that a deduction of 15% towards personal supervision was justified, whereas the DVO had allowed only 7.5%. We find that in the cited case law, jurisdictional High Court, deleted similar addition as made by the revenue by allowing 15%....