9911796707
TMI Blog1990 (1) TMI 155X X X X Extracts X X X X X X X X Extracts X X X X ..... 6-12-1986. This valuation was obtained at the time of search at the assessee's premises. 2. The first group of appeals : For the asst. years 1980-81 to 1984-85, the assessee declared the value of these jewelleries, in her return, on estimate basis. The learned counsel for the assessee, Sri A.K. Rastogi, clarifies that the valuation adopted in these returns are by adding certain percentages with the estimate made by the approved valuer as on 31-3-1976. The value declared for the asst. years 1980-81, 1981-82, 1982-83, 1983-84 1984-85 were Rs. 40,777, Rs. 40,777, Rs. 40,777, Rs. 73,440 and Rs. 61,200 respectively. The WTO in the original assessments had estimated the value at Rs. 51,000, Rs. 61,200 and Rs. 61,200 for the asst. years 1980-81, 1981-82 and 1982-83 and accepted the value declared by the assessee for the asst. years 1983-84 1984-85 at Rs. 73,440 and Rs. 61,200 respectively. In the reassessments, he has estimated the value for all the relevant asst. years at Rs. 1,95,650. A search was conducted in the premises of the appellant on 26-9-1986. These jewelleries were valued by the Govt. valuer at Rs. 1,95,650 as per his valuation report dated 6-12-1986. The WTO issue ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3. In the opinion of the DCWT(A), as the appellant had failed to disclose fully truly all the correct value of the jewellery, proceedings u/s. 17 were proper and the decisions relied by the learned counsel are well placed. The learned DCWT(A) distinguished the decision of the Hon'ble Rajasthan High Court relied by the learned counsel adverting the fact that in that case reopening was made after the audit objections were raised. Whereas in the instant case proceedings for reopening were not initiated on the basis of audit objection. 4. The learned counsel for the assessee, Sri A.K. Rastogi, appeared on behalf of the assessee before us. He submitted that there were full disclosure of primary facts before the WTO at the time of original assessment, therefore, proceedings u/s. 17 have been wrongly initiated. He pointed out that weight and descriptions of the jewelleries were made available to the WTO at the time of making original assessments. In three of the asst. years, i.e., in the asst. years 1980-81, 1981-82 1982-83 the WTO estimated the value which in his opinion the jewellery could fetch if sold in the open market on the valuation date. For the asst. years 1983-84 and 198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot giving true value of the jewelleries had concealed the true and full facts before the WTO. In reply to the submission of the learned counsel that the assessee had given full particulars of the jewelleries which should be treated as full and true disclosures. He diatribe that it is a frail attempt of ablution. He argued that in case of valuation of property only true disclosure of the value can be treated as a full disclosure and in this case the assessee failed to do so. 6. In the asst. years 1985-86 to 1987-88, the assessee declared the value of the impugned jewelleries at Rs. 61,200 in each of the asst. years. As these assessments were completed after search and receipt of the valuation report of the Valuation Officer, the WTO valued the jewelleries as per valuation report at Rs. 1,95,650. These were reduced to Rs. 1,34,450 by the learned DCWT(A). The learned counsel submitted that the valuation made by the Valuation Officer is excessive and the learned DCWT(A) also sustained the estimate at a very high amount. He further contended that the valuation report of the Valuation Officer was on 5-12-1986 which should not have been applied in the relevant asst. years. In the opinio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts necessary for the assessment. Sub-section (b) applies even there is omission or failure of the assessee, the WTO has reasoned to believe in consequence of an information that the net wealth has escaped assessment or under assessed. In respect of first clause, action should be initiated within 8 years of the relevant assessment year and for clause (b) within four years of the relevant assessment years. There is no definition of 'material facts' in the Act. But the nature of the same has been described in various cases which depends upon the facts of each case. According to the learned D.R. material which was not disclosed was the true value of the jewellery. In the case of Smt. Tarawati Devi Agarwal v. ITO [1986] 162 ITR 606, the Hon'ble Calcutta High Court had held, valuation is always a question of opinion and unless there was a clear finding on the basis of material that the assessee had invested in the construction more than what had been shown by her in the course of assessment proceedings, the ITO could not proceed merely on the basis of the valuation report of the departmental valuer. He has to reject the assessee's valuation assigning reasons therefor. The reassessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Union of India [1970] 77 ITR 802 (Delhi), in that case, the Supreme Court held that material fact not known at the time of assessment cannot be used for reopening of assessment u/s. 34(1)(a) of the I.I.T. Act, 1922 pari materia of section 17(1)(a) of the W.T. Act. The same view was taken by the Hon'ble Calcutta High Court in the case of P.R. Mukherjee. Here, in this case, the department did not bring any material to show that the assessee had knowledge of correct value of the impugned jewelleries in the relevant valuation dates. In our opinion, therefore, proceedings u/s. 17(1)(a) does not lie. 8. It cannot be disputed that the departmental valuer's report at the time of search is an information in respect of proper valuation of the jewellery. The case of Smt. Gulnar Marfatia cited by the learned counsel is not applicable in this case. The Hon'ble High Court in that case followed its own decision in Brig. B. Lall's case where reference was made to the Valuation Officer for the purposes of the reopening of the assessments. The Hon'ble High Court was of the view, section 16A of the Act does not permit it. This section can only be applied only when assessments are pending. Referen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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