2005 (3) TMI 97 - HC - Income Tax

Summary

Issues involved: Appeal by Revenue against ITAT judgment on additions as income from undisclosed sources for assessment year 1995-96 based on cost differences determined by DVO on CPWD rates.

The High Court upheld the ITAT decision, which allowed a deduction of 20% from the cost of construction estimated by the Department Valuation Officer to arrive at a reasonable estimate of construction cost for the relevant assessment year. The Court noted that the determination of the cost of construction is a question of fact, not law, and is governed by a Division Bench decision. No substantial question of law arose for consideration in the appeal, leading to its dismissal.

The Court also criticized the Assessing Officer for adopting a strange procedure of making a joint assessment order for three assessment years, emphasizing that each assessment year is a separate unit and assessments cannot overlap. While appeals with identical questions can be decided together, passing a common order for multiple assessment years is not permissible.