9911796707
TMI Blog2017 (3) TMI 393X X X X Extracts X X X X X X X X Extracts X X X X ..... : MR JP SHAH, SENIOR ADVOCATE with MR MANISH J SHAH, ADVOCATE FOR THE RESPONDENT : MR SUDHIR M MEHTA, ADVOCATE ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE M.R. SHAH) [1.0] By way of this petition under Article 226 of the Constitution of India the petitioner has prayed for an appropriate writ, order or direction to quash and set aside the impugned notice issued by the Assessing Officer under Section 148 of the Income Tax Act (hereinafter referred to as "the Act") by which the Assessing Officer has sought to reopen the assessment for the Assessment Year 2005-06 alleging inter alia that the income chargeable to tax has escaped assessment. [2.0] The facts leading to the present Special Civil Application in a nutshell are as under; [2.1] The assessee filed the return of income for the Assessment Year 2005-06. During the year under consideration, the assessee purchased one land at a price of ₹ 78 lakhs. However, stamp authorities valued the same at ₹ 1,85,05,800/- and charged the stamp duty accordingly. In the scrutiny assessment under Section 143(3) of the Act the Assessing Officer added the difference of ₹ 1,07,05,800/- (Rs.1,85,05,800/- - ₹ 78,00,000/-) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e company at ₹ 1,58,17,760/-. The assessee is in appeal before the Hon'ble CIT(A)-I against the said assessment order, which is pending. 2. The assessee company was incorporated on 05/05/2004 and has purchased a piece of land measuring 4406.14 sq meters. In katargam area of Surat. The assessee company disclosed the value of the said land at ₹ 78,00,000/-. During the course of assessment proceedings, it was observed by the Assessing Officer that the Deputy Collector, Stamp Duty Valuation Officer, Vibhag-I, Surat had valued the land at ₹ 1,85,05,800/- and the assessee company had paid stamp duty of the said value of ₹ 1,85,05,800/- and the assessee company had paid stamp duty of the said value of ₹ 1,85,05,800/-. After giving sufficient opportunity and looking at the inability of the assessee company to explain the difference, the Assessing Officer added the differential amount of ₹ 1,07,05,800/- to the total income of the assessee company under Section 69 of the Act. The Assessing Officer has referred the property for valuation to the Valuation Officer. However, the valuation report was not received by the Assessing Officer till the time of comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income-Tax Vs. Dhariya Construction Co. reported in [2010] 328 ITR 515 (SC) the opinion given by the DVO is not per se information for the purpose of reopening an assessment under Section 147 of the Act. It is submitted that therefore solely on the basis of the DVO's report, the Assessing Officer is not justified in reopening the assessment, which was, as such, scrutiny assessment under Section 143(3) of the Act. [3.1] It is further submitted by Shri J.P. Shah, learned Senior Advocate appearing on behalf of the assessee that even otherwise and having failed before the learned CIT(A) to enhance the deemed income, relying upon the DVO's report, thereafter it is not open for the Assessing Officer to reopen the assessment on the very ground, which was not accepted by the learned CIT(A). It is submitted that in the present case, in Appeal against the scrutiny assessment under Section 143(3) of the Act, the Assessing Officer did request to enhance the unexplained /unaccounted income, however, the learned CIT(A) specifically rejected the said request by observing and relying upon its earlier decision in the case of Balkishan Poddar (Supra). It is submitted that the decision in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al available with the Assessing Officer to form an independent opinion that the income chargeable to tax has escaped the assessment for the Assessment Year 2005-06. As held by Hon'ble the Supreme Court in the case of Dhariya Construction Co. (Supra) opinion given by the District Valuation Officer is not per se information for the purpose of reopening an assessment under Section 147 of the Act. Similar view has been taken by the Division Bench of this Court in the case of Dr. Rajivraj Ranbirsingh Choudhary Vs. Assistant Commissioner of Income-Tax rendered in Special Civil Application No.21470/2016. Under the circumstances, solely relying upon and /or on the basis of the information in the form of DVO's report, the Assessing Officer is not justified in reopening the scrutiny assessment under Section 143(3) of the Act. [5.1] It is also required to be noted that as such while framing the original assessment, it was the scrutiny assessment and the Assessing Officer made the addition of ₹ 1,07,05,800/- as deemed income, being unexplained investment under Section 69 of the Act, considering the valuation determined by the stamp authorities and thereafter the Assessing Officer framed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d CIT(A) to enhance the unexplained investment, which was relying upon the DVO's report, thereafter it is not open for the Assessing Officer to reopen the assessment under Section 148 of the Act on the very ground i.e. relying upon the DVO's report. Under the circumstances, the impugned notice under Section 148 of the Act and /or reopening of the assessment for the Assessment Year 2005-06 cannot be sustained and the same deserves to be quashed and set aside. [5.4] Now, so far as the reliance placed upon the decision of the Delhi High Court in the case of ACC Ltd (Supra) is concerned, on going through the decision of the Delhi High Court, we are of the opinion that the said decision shall not be applicable to the facts of the case on hand. In the case before the Delhi High Court the assessee challenged the reference to the DVO and /or DVO's report on the ground that the valuation report was received after completion of the assessment proceedings. In the present case, having found that during pendency of the assessment proceedings Reference was already made to the DVO, however the DVO's report was not received and as the time limit to frame the assessment was likely to be over, the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
