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TMI Blog2019 (1) TMI 272X X X X Extracts X X X X X X X X Extracts X X X X ..... elhi passed the impugned order as an assessment order which has been mentioned on the front page of the order dated 31.03.2018 passed by the Pr. CIT, therefore, the said order was not a valid order u/s 263 of the Act. Moreover, nowhere the ld. Pr. CIT mentioned in the said order that there was any relevant material before him for the year under consideration to substantiate that the AO had not applied his mind while framing the original assessment u/s 143(3) of the Act rather the ld. Pr. CIT acted only on the basis of the valuation report obtained by the AO for the assessment year 2015-16 on 15.12.2017. It cannot be said that the Pr. CIT came to the conclusion on the basis of the relevant record pertaining to the assessment order under consideration i.e. assessment year 2013-14 that the order passed by the AO was prejudicial to the interest of the revenue or it was erroneous. On the contrary, the AO applied his mind and did not accept the revised claim of the assessee and had taken a possible view. It is well settled that the provisions of Section 55A of the Act provides that the AO may refer the matter to DVO for valuation of the property. The use of the word “may” makes it discre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT. vii) Upholding the action of the successor AO for AY 2015-16 of accepting the valuation report of DVO in which the Land at Vasant Vihar was compared with the land at Safdarjung Enclave while determining the Fair Market Value as at 01.04.1981. viii) Enhancing the assessment by making an addition of ₹ 5021603/- to the valuation of land and building for capital gains by valuing land at ₹ 9994471/- and building at ₹ 2843976/- as on 01.04.1981 as against ₹ 13642650/- and ₹ 4217400/- respectively, valued by the Assessee based on a valuation report by a registered valuer. ix) Applying the Expl. 2 to Section 263 of the Act, 1961 for the relevant Assessment Year, although the same has been effective w.e.f. 01.06.2015. x) Making an "Assessment Order" in the above said case which power vest only with the Assessing Officer under the Income Tax Act. xi) Not referring the matter to the Assessing Officer to complete the proceedings in accordance with law after giving assessee an opportunity to appear before him. (B) Without prejudice above, the order U/s 263 dated 31.03.2018 was passed in haste as no reasonable opportunity of being he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 4,28,18,052/-. Thereafter, the successor AO made a proposal to the ld. Pr. CIT for remedial action u/s 263 of the Act. 6. The ld. Pr. CIT observed that during the assessment proceedings for the assessment year 2015-16, to ascertain the true value of the property, the matter was referred to the District Valuation Officer who submitted the report on 15.12.2017 which provided variance in the valuation of the report submitted by the assessee and on that basis an addition of ₹ 12,73,785/- was made for the assessment year 2015-16. The ld. Pr. CIT also observed that the assessee had sold basement and ground floor for ₹ 3.50 crores and second floor of ₹ 11.90 crores during the period relevant to the assessment year under consideration. He also pointed out that the assessment for the assessment year 2013-14 was completed on 30.11.2015 and the case was not referred to the DVO. Therefore, this fact that the value of property had been taken more than its value, was not available before the AO. Thus, the returned income of the assessee was accepted and in the light of above facts, the AO had referred this case. The ld. Pr. CIT observed that he had considered the mater ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment order and the department cannot take shelter of Section 292B of the Act, since it was not a mere mistake/defect or omission as the assessment order was not inconformity with or not in accordance to the intent and purpose of the Act. It was contended that the ld. Pr. CIT had treated the original order erroneous and made the assessment on the following basis: "This fact that the value of property has been taken more than its value, was not available before the AO". However, the aforesaid finding was first time stated/recorded in the order of Pr. CIT and was completely absent in the showcause notice issued u/s 263 of the Act. Therefore, it was clearly an afterthought which should not be acceptable in the eyes of law and further the ld. Pr. CIT was not aware with the actual facts of the matter neither at the time of issuing notice nor at the time of concluding the proceedings u/s 263 of the Act. 8. The ld. Counsel for the assessee stated that the provisions of Section 263 of the Act as on 01.04.2013 provides that the Commissioner may call for and examine the record of any proceeding under this Act but not the Pr. CIT as the powers to Pr. CIT had been given with retrospec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .1 of the assessment order. It was contended that the assessment order passed by the AO could not have been treated as erroneous order or prejudicial to the interest of the revenue, when the AO had adopted one of two courses permissible in law. It was stated that even if, it is assumed that there was variation in the value adopted by the assessee for the asset and the fair market value of the asset, even then the law provides the discretionary power on the AO whether to refer the matter to valuation officer or not, depending upon his judgment on the given facts/matter. A reference was made to the provisions contended in Section 55A of the Act. It was contended that the ld. Pr. CIT had issued show-cause notice without appreciating the merits/facts as a whole and without looking/commenting anything on the accuracy of the valuation report obtained u/s 55A of the Act during the assessment year 2015-16 and without speaking on the objections filed by the assessee on the said valuation report and passed the impugned order in haste by not giving reasonable/proper opportunity to the assessee to put forward his submission on the same. Therefore, it is a clear case of substituting the views b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 011) 335 ITR 0083} (Del.) * Chroma Business Ltd. vs. DCIT {82 TTJ 0540} [Del] * CIT vs. Fine Jewellery (India) Ltd. {372 ITR 0303} [Mum] * CIT vs. Nirma Chemical Works (P) Ltd. {222 CTR 0593} [Guj] * NARAYAN TATU RANE vs. ITO {(2016) 47 CCH 0309} {ITAT Bombay Tribunal (B)} * CIT vs. Arvind Jewellers {(2003) 259 ITR 0502}( Guj) * Jagjit Industries ltd. vs. ACIT {(1997) 60 ITD 0295} [Del. Trib] * CIT vs. Gabriel India Ltd. {(1993) 203 ITR 0108} (Bom) * Torrent Pharmaceuticals Ltd. vs. DCIT {164/Ahd/2018} dated 08.08.2018 [Ahd ITAT] * CIT vs. DLF Ltd. {350 ITR 0555} [Del] * CIT vs. J.L. Morrison (India) Ltd. {270 CTR 0405} [Kol] * Sree Alankar vs. Pr. CIT {108/CTK/2018 dated 12.09.208} [ITAT Cuttack] * Braham Dev Gupta vs. Pr. CIT {49 CCH 0383} [Del Trib] * Ambuja Cements Ltd. vs. CIT {51 CCH 0325} [Mum Trib] * CIT vs. ASHWANI GUPTA {(2010) 322 ITR 0396} (Del) * CIT vs. OASIS HOSPITALITIES (P) LTD. {(2011 333 ITR 0119} [Del] * Kishinchand Chellaram vs. CIT {(1980) 125 ITR 0713} (SC) * A. Kannan vs. State of Tamil Nadu {201 ITR 0205} [Chen] * Fancy Dyeing & Printing Works vs. ITO {64 CTR 0239} [Kol] * CIT vs. Prem Syndicate {31 C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 322 12. We have considered the submissions of both the parties and perused the material available on the record. In the present case, it is an admitted fact that the ld. Pr. CIT passed the Assessment Order which could have been passed by the Assessing Officer only, since the powers has been given under Sections 143(3), 144, 147, 153A and 153C of the Act to the AO who has been defined u/s 2(7A) of the Act and means the Assistant Commissioner or Deputy Commissioner or Assistant Director or Deputy Director or the Income-tax Officer who is vested with the relevant jurisdiction by virtue of directions or orders issued under sub-Section (1) or (2) of Section 120 or any other provision of this Act and the Additional Commissioner or Additional Director or Joint Commissioner or Joint Director who is directed under clause (b) of Sub-section (4) of the said Section but nowhere it is provided that the Pr. Commissioner can pass an assessment order. In the present case, the ld. Pr. CIT-18, New Delhi passed the impugned order as an assessment order which has been mentioned on the front page of the order dated 31.03.2018 passed by the Pr. CIT, therefore, the said order was not a valid order u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l order, by no stretch of imagination can a higher authority interfere with the independence which is the basic feature of any statutory scheme involving adjudicatory process." 14. It is well settled that the provisions of Section 55A of the Act provides that the AO may refer the matter to DVO for valuation of the property. The use of the word "may" makes it discretionary so it is not mandatory. In this case, it appears that the AO was satisfied from the valuation of the property, he did not refer the matter to the DVO and accepted the valuation report of the Registered Valuer (approved by the Govt.) which was furnished by the assessee. Therefore, it can be said that the AO has taken one of the possible view in this case, therefore, it cannot be said that the assessment order passed was erroneous or prejudicial to the interest of the revenue. We, therefore, by keeping in view the ratio laid down by the Hon'ble Apex court in the aforesaid referred to case of CIT Vs Greenworld Corporation, are of the view that the AO passed the assessment order after application of mind and considered the revised computation of long term capital gain furnished by the assessee was well as the Valuati ..... X X X X Extracts X X X X X X X X Extracts X X X X
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