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TMI Blog2010 (2) TMI 890X X X X Extracts X X X X X X X X Extracts X X X X ..... wrong as there is no basis or method for the reduction. In fact, the defect having been accepted the valuation report itself was no more a reliable document for the purpose of making any addition and the addition itself, which has been made on the basis of such report is liable to be deleted in toto and we do so - appeal of the assessee is allowed. - ITA No. 1162 /Del/2009, I.T.A. No. 1689/Del/2009 - - - Dated:- 5-2-2010 - K.G. Bansal, George Mathan, JJ. Ravi Gupta, Adv., for the Appellant Sambit Tripathi, Sr. DR, for the Respondent ORDER George Mathan: 1. I.T.A. No.1162/Del/2009 is an appeal by the assessee and I.T.A. No.1689/Del/2009 is an appeal by the revenue against the order of Ld. CIT(A) II, New Delhi in appeal No. Del/CIT(A)-II/28/64/560 dated 19.02.2009 for the Assessment Year 2003-04. Shri Sambit Tripathi, Sr. DR represented for the revenue and Shri Ravi Gupta, Advocate represented for the assessee. 2. It was the submission by the Ld. A.R. that the assessee is a company and it had during the relevant Assessment Year purchased the 2nd floor in a property No.G-25, Green Park (Main) New Delhi for a consideration of Rs.11,84,926/-. It w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on information widely available in all print medias such as newspapers etc., about the enhanced property prices in this area, it appeared that the assessee had not truly disclosed its exact quantum of investment in the property. In order to the verify the genuineness of the quantum of investment made by the assessee company in the purchase of the said property, a reference was made to the District Valuation Officer under section u/s 142A of the I. T. Act in the course of assessment proceedings. Since the report of the DVO was not received up to the date of limitation of passing the assessment order, the assessment was passed with the office note that appropriate action be taken on receipt of valuation report from the DVO. In this report, the DVO had determined the value of investment in the said pro9eprty at Rs.60,53,700/-. Since, the difference in the value determined by the DVO was significantly higher in comparison to the value declared by the assessee, the assessee company was provided with a copy of the valuation report submitted by the DVO with the show cause as to why addition should not be made on the report of the valuation officer. In response to this assessee compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ision of Hon'ble High Court of Delhi in the case of Gulshan Kumar reported in 257 ITR 703. He further placed reliance on the decision of Coordinate Bench of this Tribunal in the case of M/s. Rajeshwar Nath Gupta in I.T.A. No.4295/Del/2005 dated 09.05.2008 to support his proposition that without any material or evidence or information on the basis of which it can be said that the consideration shown by the assessee was understated, a reference to the DVO by invoking the provisions of Section 142A could not be made. It was the further submission that against the ad hoc reduction of the addition made by the A.O. by an amount of Rs.10 lacs by the CIT(A) the revenue has filed the appeal and the assessee has challenged the non-deletion of the addition in toto. It was the submission that the comparative case as taken by the DVO was of a much earlier period and of a better located property. It was the further submission that the assessee had also given two comparable cases in the same location and which was also during the period 2002- 03 and 2003-04 whereas the comparable case considered by the DVO was of the period 2000-01 and of a much better location. It was the submission that at the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Here, it is noticed that the assessee has purchased the property and has shown the purchase consideration in his books of accounts. Thus, it is the provisions of Section 69B, which have to be considered in the present case. A reading of the provisions of Section 69B shows that the A.O. should find that the amount incurred on making such investment or in acquiring such bullion, jewellery and other valuable articles exceeded the amount recorded in this behalf if the books of accounts maintained by the assessee. Thus, what is required is a positive act of a finding by the A.O. Thus, the A.O. must first arrive at a finding that there is an excess expenditure incurred by the assessee in acquiring the bullion, jewellery or other valuable articles. It is after such a finding that the next stage of invoking the provisions of Section 142A would come into play to determine as to what is the actual expenditure that has been incurred. It is for the purpose of estimating such expenditure that the valuation is referred o the DVO. A perusal of the reasons recorded clearly shows that there is no finding by the A.O. that the assessee has incurred any expenditure in excess and what has been decl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ference to the DVO by invoking the provisions of Section 142A thus was not satisfied in the present case and neither the said reference nor the addition made on the basis of report obtained form the DVO in response to the said reference, in our opinion, was sustainable in law as rightly held by the Ld. CIT(A). In the case of Subhash Chand Chopra vs ACIT- 92 TTJ 1087, this Bench of the Tribunal has held that no material or evidence having been recovered during the course of search showing investment in construction, the A.O. was not competent to make a reference to the DVO u/s 142A and to make addition on that basis. In the case of K.P. Verghese (supra) cited by the Ld. counsel for the assessee, Hon'ble Supreme Court had an occasion to consider a similar aspect in the context of computation of capital gains and it was held by their Lordships that the burden to prove that the consideration for the transfer of a capital asset has been understated by the assessee or in other words the full value of consideration in respect of the transfer is shown at a lesser figure tan that actually received by the assessee as alleged, is on the Revenue. Following the said decision of Hon'ble Supr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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