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TMI Blog2014 (1) TMI 1438X X X X Extracts X X X X X X X X Extracts X X X X ..... ing rejected, wherein expenditure relating to the construction is recorded and such books of account have not been rejected by the Assessing Officer under Section 145 of the Act - Decided in favour of assessee. - ITA Nos. 1583 to 1585/PN/2013 - - - Dated:- 28-10-2013 - Shri G. S. Pannu And Shri R. S. Padvekar,JJ. ORDER Per G. S. Pannu, AM The captioned three appeals relate to single assessee and are directed against a consolidated order of the Commissioner of Income Tax (Appeals)-III, Pune dated 24.07.2013 which, in turn, has arisen from the orders dated 29.11.2002, 27.01.2005 17.03.2006 passed by the Assessing Officer, under Section 143(3) of the Income Tax Act, 1961 (in short "the Act"), pertaining to the assessment years 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lues as per the cost of construction depicted in the account books : - (i) A.Y. 2001-02 - Rs.28,70,117/- (ii) A.Y. 2002-03 - Rs. 25,68,405/- (iii) A.Y. 2003-04 - Rs.90,358/- The aforesaid additions are challenged in appeal before us. 3. Before proceeding further it may be noticed that initially for assessment year 2001-02, the CIT(A) vide order dated 12.01.2004 had set-aside the addition on the ground that the Assessing Officer was not competent to make reference to the DVO in the light of the judgement of the Hon'ble Supreme Court in the case of Smt. Amiya Bala Paul vs. CIT, 262 ITR 407 (SC). The said decision of the CIT(A) has since been set-aside by the Tribunal vide order in ITA No.442/PN/2004 dated 20.04.2007 in view of the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... condition necessary for making a reference to the DVO in terms of the amended provisions of Section 142A of the Act were fulfilled. 6. We have carefully considered the rival submissions on this aspect. In the present case, the Assessing Officer has invoked Section 69B of the Act to tax the difference in the value of cost of construction as estimated by the DVO and that declared by the assessee in his books of account. Section 69B of the Act empowers the Assessing Officer to tax an amount invested by the assessee which is found to be over and above the amount recorded in the books of account maintained. However, a crucial expression in Section 69B of the Act is that the Assessing Officer ought to find "......that the amount expended on ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment order and find that the Assessing Officer has not rejected the books of account under Section 145 of the Act. In-fact, in para 3 of the assessment order, the Assessing Officer has observed that the assessee explained the return of income filed by producing books of account such as Cash-Book, Ledger, etc. Even after his examination of the cost of construction of the Hospital Building, the Assessing Officer has not pointed out any discrepancy in the cost of construction declared in the books of account. In para 4 of the assessment order the only basis for making of reference to the DVO appears to be "local enquiries". As per the Assessing Officer, "local enquiries" revealed that expenses shown by the assessee on construction of the Hos ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduced the books of account such as Cash-Book, Ledger, etc. and no infirmity or defects in the same have been pointed out. Further in the subsequent paragraphs where the Assessing Officer has discussed the addition on account of cost of construction of the Hospital Building, no adverse comments have been made with regard to any defects or discrepancy in the account of cost of construction maintained in the books of account. Merely disagreeing with the cost of construction declared in the books of account and that too on the basis of unspecified "local enquiries", does not reflect that the Assessing Officer implied to invoke his powers of Section 145 of the Act to reject the books of account. 9. Furthermore, in the computation of finally ..... X X X X Extracts X X X X X X X X Extracts X X X X
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