2009 (10) TMI 979 - AT - Income Tax

Summary

Issues involved: Appeal against order of CIT(A) regarding estimated addition u/s 69B of the IT Act for assessment year 2004-05.

Summary:

Issue 1: Valuation of commercial complex by District Valuation Officer (DVO)
The assessee declared income including deposit given to Karnataka Power Transmission Co., Ltd. DVO valued construction higher than declared amount. Assessee objected to valuation method and rates used by DVO, highlighting discrepancies in estimation. CIT(A) restricted addition to &8377; 1.00 Lakh from &8377; 16,75,771 made by Assessing Officer. Revenue opposed, citing DVO's rates as unreasonable. AR supported CIT(A)'s decision.

Issue 2: Discrepancies in valuation report by DVO
AR pointed out defects in DVO's valuation report, including incorrect rates, overestimation of water supply and staircase, and inadequate consideration of self-supervision by assessee's husband, a civil contractor. CIT(A) found DVO's rates exaggerated and unreasonable, granting relief to assessee. Discrepancies in valuation amounts were detailed, showing significant differences between DVO's and Regd. Valuer's assessments. Previous tribunal decisions supported the use of local rates for valuation in Karnataka.

Conclusion:
The Tribunal upheld CIT(A)'s decision, dismissing the revenue's appeal. It was found that DVO's valuation was exaggerated and not based on actual rates, supporting the relief granted to the assessee. The judgment was pronounced on 16-10-2009.