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TMI Blog2011 (2) TMI 1392X X X X Extracts X X X X X X X X Extracts X X X X ..... al in nature and no specific adjudication is called for. Hence, the same are dismissed. 3. The 7th ground raised relate to the levy of interest u/s 234B of the Act. 3.1 The levy of interest u/s 234B of the Act is mandatory and consequential in nature and hence, this ground is dismissed. 4. The other grounds, namely, ground no.2 to 6, relate to the issue, whether the CIT(A) is justified in sustaining the addition to the extent of 25% made by the Assessing Officer. The Assessing Officer made the addition on account of difference in the cost of construction as disclosed by the assessee and the value fixed by the DVO. 4.1 The brief facts in relation to the issue are as follows:- The assessee is a firm. It is running a hospital providing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the cost of construction of hospital building, the assessee preferred an appeal before the first appellate authority. 4.3 It was contended before the CIT(A) that the District Valuation Officer's report was for the year 2002, whereas the construction work had commenced in the year 1996-97. It was submitted that the increase in the cost of materials would have necessarily increased the cost of construction. It was further submitted that the actual cost incurred for the construction of building and the equipment installed therein was debited in the regular books of account and the auditor's report u/s 44AB, it was submitted, did not contain any adverse remarks in the financial results of the firm. Therefore, it was contended that the income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... addition of ₹ 95,884/-, has filed this appeal before us. 4.6 The learned AR submitted that the first appellate authority having found that there is no case in making a substantial addition with the cost adopted by the assessee, has erred in sustaining the addition to the extent of 25% of the addition made by the Assessing Officer. It was submitted that the assessee had maintained regular books of account and the entire cost of construction is accounted in the books. It was argued that since these books of account have not been rejected, the addition made by the Assessing Officer and sustained by the CIT(A) to the extent of 25%, is unwarranted and not justified on the facts and circumstances of the case. 4.7 The ld. AR further reli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are made available, represent the structure completely". 4.10 The assessee's contention is that the actual cost incurred in the construction of the building and the equipment installed therein is correctly recorded in the regular books of account and there are no adverse remarks on the financial results of the assessee firm. It is the further contention of the assessee that the Assessing Officer, having not rejected the books of account, ought to have accepted the cost of construction recorded in the books of account maintained by the assessee firm. However in the instant case we are of the view that, though the Assessing Officer has not rejected the entire books of accounts and not specifically observed that the books of account are not r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the construction of the hospital building and further perusing the valuation report furnished by the assessee, ld. AO came to the conclusion that the matter needs to be further examined by the DVO since the technical evaluation of civil construction of hospital building was not within his wisdom. The valuation report dated 23.4.2003 furnished by the assessee (page 26 of the paperbook filed by the assessee) before the ld. AO was too vague and not based on sound principles. Ld. DR clarified before us that the Assessing Officer after examining the books of accounts, in particular the building construction account in the general ledger and perusing the half-baked valuation report furnished by the assessee, was left with no other option but ..... X X X X Extracts X X X X X X X X Extracts X X X X
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