Gauhati High Court
Income-Tax Officer vs Gita Rani Banik on 21 December, 2000
Equivalent citations: [2001]251ITR712(GAUHATI)
Author: A.H. Saikia
Bench: A.H. Saikia
JUDGMENT J.N. Sarma, J.
1. This appeal has been filed under Section 260A of the Income-tax Act, 1961, against the order passed by the Income-tax Appellate Tribunal, Guwahati Bench, in I. T. A. Nos. 283 and 284/Gauhati of 1995, dated January 20, 1999, for the assessment years 1989-90 and 1990-91.
2. The brief facts are as follows :
The assessee and her husband constructed a four storeyed building at Hospital Road, Silchar, making equal contribution by way of investment. The building was completed in the month of June, 1990. The cost of the construction was shown at Rs. 8,42,000 up to June, 1990, in support of which the assessee filed a valuation report from a registered valuer. The Assessing Officer made a reference to the Valuation Officer, the Income-tax Department under Section 55A of the Income-tax Act, 1961, for ascertaining the cost of construction made by the assessee in the building. The Departmental Valuation Officer determined the cost of construction of the building at Rs. 17,49,884 out of which Rs. 2,56,164 was ascertained as investment made in the financial year 1988-89. On the other hand, the assessee had shown the total cost of construction at Rs. 8,41,977. The registered valuer had shown investment in the building during the financial year 1988-89 at Rs. 1,01,920. The Assessing Officer examined and considered the investment made by the assessee in the construction of the building in the light of the valuation reports of both the Departmental Valuation Officer and the registered valuer. The Assessing Officer for the reasons stated in his assessment order took the view that the assessee could not offer a satisfactory explanation for investment made in the construction of the building to the extent of Rs. 1,21,584 in the financial year 1988-89. As the assessee had a 50 per cent, share in the construction of the building, the Assessing Officer added Rs. 60,792 to the income of the assessee as unexplained income.
3. An appeal was filed by the assessee before the Commissioner of Income-tax (Appeals) who took the view that the Assessing Officer referred the matter to the Departmental Valuation Officer for determining the cost of construction of the building and this was justified as a part of the general enquiry under Section 142 of the Act.
4. Against the order of the Commissioner, an appeal was filed before the Income-tax Appellate Tribunal wherein the impugned order was passed. The Tribunal reversed the order of the Assessing Officer holding that there was no power to refer the matter to the Valuation Officer of the Department under Section 55A of the Income-tax Act and in that view of the matter the order was quashed.
5. Two questions of law arose and they are as follows :
"(1) Whether, on the facts and in the circumstances of the case, the Tribunal was correct in law in holding that the Assessing Officer cannot refer the case to the Valuation Officer under Section 55A of the Income-tax Act, 1961, for the purpose of determining the cost of construction of the building ?
(2) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in deleting the addition on account of unexplained investment in the construction of the building merely on the ground that the reference to the Valuation Officer was made under Section 55A of the Income-tax Act, 1961, for the purpose of determining the cost of construction of the building ?"
6. This matter is covered by a judgment of this court in CIT v. Amiya Bala Paul [1999] 240 ITR 378, wherein the same questions arose. The question is at page 380. A Division Bench of this court discussed the contention regarding Section 55A and held as follows (page 386):
In view of the decisions referred to in this judgment and in the discussion held above, we are of the view that the assessing authority would be quite competent to call for the report on the valuation of the cost of construction from the Valuation Officer in view of the provisions under Sections 131, 133(6) and 142(2) of the Income-tax Act. These are the enabling machinery provisions which vest ample powers in the assessing authority, any wrong mention of provision on the requisition memo will not be material."
7. That being the position, this appeal is allowed the judgment of the Appellate Tribunal shall stand quashed and the order of the Assessing Officer as well as the first appellate court shall stand restored. Heard Mr. G. K. Joshi, learned advocate for the appellant assisted by Mr. U. Bhuyan. None appears for the respondent.