2010 (3) TMI 896

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..... an for the Applicant. D. Anand for the Respondent. ORDER Vijay Pal Rao, Judicial Member. - This appeal by the revenue is directed against the order dated 7-9-2009 of the Commissioner of Income-tax (Appeals), Tiruchirapalli for the assessment year 2006-07. 2. The only issue that arises for consideration and adjudication is whether the Commissioner of Income-tax (Appeals) is justified in allowing a relief of Rs. 15,41,684 towards cost of construction of kalyanamandapam by holding that the State PWD rates are to be adopted for valuation in place of CPWD rates adopted by the Assessing Officer. 3. The assessee, a civil contractor, had constructed a kalyanamandapam and shopping complex called Kailash Complex and Santhosh .....

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..... hand, learned counsel for the assessee has submitted that it is well settled law that PWD rates are applicable when the property is located in a mofussil area. The Departmental Valuation Officer adopted the CPWD rates while estimating the value of construction. Therefore, the learned Commissioner of Income-tax (Appeals) has rightly allowed 15 per cent deduction on the valuation based on the CPWD rates by following the decision of the hon ble jurisdictional High Court in the case of K.K. Seshaiyer v. CIT [2000] 246 ITR 351 (Mad.) as well as decision of the hon ble Rajasthan High Court in the case of CIT v. Hotel Joshi [2000] 242 ITR 478. He has also relied upon the decision of the hon ble jurisdictional High Court in the case of A. .....

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..... er quality of construction or fixtures than that which the assessee has recorded in his books, the opinion of the valuer cannot be straightaway substituted for the actual cost that was recorded in the assessee s books. The Tribunal has not found that the books maintained by the assessee are not credible. In fact the Tribunal has not expressed opinion on the correctness of the entries in the assessee s books. Though in the order initially made, the Tribunal found fault with the assessee for not having produced the agreement with the contractor, after the assessee pointed out that the agreement that had been entered into with the contractor had been produced before the Assessing Officer, the Tribunal made a further order refusing to reconside .....

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