1983 (11) TMI 149 - AT - Wealth-tax

Summary

Issues Involved:
1. Validity of the revised valuation report on the cinema building.
2. Duties and powers of the Valuation Officer (V.O.) under Section 16A of the Wealth Tax (W.T.) Act.
3. Powers of the V.O. to amend his valuation report under Section 35 of the W.T. Act.
4. Legality of the directions issued by superior authorities to the V.O.

Detailed Analysis:

1. Validity of the Revised Valuation Report on the Cinema Building:
The revenue contested the AAC's decision to invalidate the revised valuation report on the cinema building known as Alka Talkies and to adopt the initial valuation report. The initial valuation report was prepared by the departmental valuer and considered the property in the hands of the partners of M/s. Jaimal Singh & Sons. The initial valuation report allowed deductions for joint ownership, video piracy, and reproduction method. However, subsequent reports by the Valuation Officer (V.O.) revised these deductions, leading to higher valuations. The AAC found no mistakes in the initial report and held that the first report should be adopted by the WTO for assessment purposes. The tribunal upheld this decision, stating that the subsequent revisions were not legally valid.

2. Duties and Powers of the Valuation Officer (V.O.) under Section 16A of the Wealth Tax (W.T.) Act:
Section 16A outlines the duties and powers of the V.O. from the time he receives advice from the W.T.O. to determine the fair market value of the property. The V.O. can serve notices to the assessee to produce necessary documents, pass an order if the declared value is correct, and provide an opportunity for the assessee to object to the proposed valuation. After considering the objections, the V.O. must estimate the value of the property and send the order to the W.T.O., who will then complete the assessment based on this report. The tribunal emphasized that once the V.O. submits his report, he becomes functus officio and cannot cancel or recall his estimation.

3. Powers of the V.O. to Amend His Valuation Report under Section 35 of the W.T. Act:
Section 35 allows for the rectification of any mistake apparent from the record. The V.O. can amend his valuation report if it contains an obvious, glaring, and patent error. The tribunal noted that any amendment must be based on mistakes that are apparent from the record and not on long-drawn processes or opinions. The V.O. can only rectify his own orders and not those directed by superior authorities. The tribunal found that the subsequent revisions of the valuation report were not based on apparent mistakes but were influenced by directions from superior authorities, making them invalid.

4. Legality of the Directions Issued by Superior Authorities to the V.O.:
The tribunal examined the directions issued by the Superintending Engineer and the Chief Engineer, which led to the revised valuation reports. The tribunal held that the Act does not provide for rectification at the instance of administratively superior authorities. The directions from the Superintending Engineer and the Chief Engineer were outside their jurisdiction and invalid. The tribunal concluded that the V.O.'s initial report dated 28.6.1985 was the only legally valid report, and the subsequent reports dated 3.2.1986 and 22.12.1986 were not legally binding.

Conclusion:
The tribunal dismissed the appeals, upholding the AAC's decision to adopt the initial valuation report for the assessment purposes. The tribunal found that the subsequent revisions were not legally valid as they were influenced by directions from superior authorities, which were outside their jurisdiction. The initial report dated 28.6.1985 was deemed the only legally valid report, and the WTO should have adopted this report for completing the assessment.