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TMI Blog1977 (3) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... 9,600 in the return. The plot was of the area of 4,800 sq. yards. A number of single - storey structures stood on the land. There were seven such structures and the plinth area came to in all 11,489 sq. ft. as on31st March, 1968; and 13,424 sq.ft. as on31st March, 1973. The gross rental income from the property was Rs. 21,240 per annum. After the return was filed the Wealth-tax Officer took up the case for examination and on29th Jan, 1973, the Wealth-tax Officer asked the assessee to file a valuation report for theGhaziabadproperty. (According to the I.A.C. this was because the value of Rs. 59,600 shown by the assessee for this property was "obviously very low") The assessee then filed a revised return on31st October, 1973. In this return, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... creasing and secondly, there had been some increase in the built up area viz : by about 2,000 sq.ft. the assessee was aware of both the circumstances and he ought to have, therefore, disclosed the correct value of the property. (iv) There was also no merit in the submission that the assessee having disclosed the higher value in his revised return, no penalty was leviable. The said revised return was not made on the assessee s own volition. Concealment was detected in the course of the assessment proceedings and only when the Wealth-tax Officer asked the assessee to get the property revalued the assessee camp up with the revised return. In fact, even this valuation of Rs. 1,61,700 was not accepted by the Wealth-tax Officer. It was estimate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rty at Rs. 59,600 as per valuer s report for the assessment year 1968-69." It is submitted for the assessee that what the assessee stated before the I.A.C. was this : the value of the property was shown at Rs. 59,600 for this assessment year on the basis of a valuer s report on the value of property. It is pointed out that the assessee had made it clear in his letters of17th September, 1975and22nd October, 1975to the I.A.C. that this report was by Shri J.C. Puri (dated19th April, 1972.) The assessee s case really was that the same value of Rs. 59,600 had been returned for the assessment years 1968-69 to 1972-73. (The valuation date for the last of these years was 31st March, 1972). This value of Rs. 59,600 was accepted by the Department a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... voluntarily showing a higher value of an asset than shown in the original return; and that such revised return was not promoted by any prior detection of concealment or undervaluation. Attention was invited to the endorsement on the order-sheet by the Wealth-tax Officer on21st September, 1973. All that happened was, the Wealth-tax Officer noticed that there was no valuation report accompanying the return for this year and one was asked for. The assessee readily complied with this request and when he found that the valuation report obtained by him in this regard (Report dated 29th October, 1973) placed the value of the property at a higher figure, he forthwith filed a revised return showing a higher net wealth accordingly on31st October, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med a valid basis for the assessee s belief that the same valuation could be shown this year. The second circumstance, we notice in favour of the assessee is from the nature of the endorsement of the Wealth-tax Officer in the order-sheet on21st September, 1973. At our instance, the Departmental Representative read out the endorsement. There is no mention in this of any inquiry having been made into the valuation of the property so as to bring out or even suspect any under-valuation. The Wealth-tax Officer simply asked for a valuation report for this year (None seems to have accompanied the return). Hence we do not find the I.A.C. s assertion that the Wealth-tax Officer found the valuation of 59,600 to be "obviously very low" and that the We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the penalty proceedings that the explanation for the cash credits given by him in the assessment proceedings was correct. This is, of course, not a case of cash credits but we see force in the submission for the assessee that in the instant case the assessee is entitled to show the circumstances under which he filed the revised return showing a higher valuation and that the original return filed did not show any deliberate under-valuation but was based on a bonafide belief of the assessee, and that this bonafide belief could be established from the facts on record. Hence, in our view, the ruling in Mahabir Metals Works case is not helpful here to the Revenue. 9. In the result, the penalty is cancelled and the appeal is allowed. - - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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