2012 (5) TMI 634 - HC - Income Tax

Reopening of assessment - Held that - In view of the judgment of the Supreme Court in Assistant Commissioner of Income Tax versus Dhariya Construction Company, (2010 (2) TMI 612 - Supreme Court of India) reopening cannot be sustained. Further, in Commissioner of Income Tax versus Puneet Sabharwal, (2010 (12) TMI 846 - Delhi High Court) it has been held that addition cannot be solely made on the basis of the valuation report. We also notice that before the CIT(Appeals), the assessee had pointed out that the Assistant Valuation Officer had relied upon one transaction relating to sale in DDA auction of a property located in a different location. It was also stated that the property in question is located in category B and the circle rates notified by the Government of NCT of Delhi on 18th July, 2007 for category B colony was ₹ 34,100/- per square meter. The Assistant Valuation Officer has taken the land rate for the sale transaction in question, which relates to September, 2005, at ₹ 92,975/- per square meter.

Summary

The Delhi High Court dismissed the appeal citing the Supreme Court judgment in Assistant Commissioner of Income Tax versus Dhariya Construction Company. Addition cannot be solely made based on a valuation report, as held in Commissioner of Income Tax versus Puneet Sabharwal. The Assistant Valuation Officer's reliance on a transaction from a different location was also noted.