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TMI Blog2019 (4) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... ld not be filed in time as we were advised by our authorised representative that we have received the relief by learned CIT(A) and therefore no further appeal before the Hon'ble ITAT was required. However, now, it has been noticed that only part relief was granted by the learned CIT(A) and therefore, the appellate order passed by CIT(A) needs to be challenged further before the Hon'ble ITAT. Therefore, the appeal could be filed on 21/11/2017 with the delay of 1274 days as the appeal was due for filing on 27.05.2014 and instead of that the same has been filed on 21/11/2017 The delay in filing of the appeal may please be condoned and the appeal may please be considered." 2.1 Further, the AR of the assessee submitted that the department initiated recovery proceedings to recover the tax due from the assessee and accordingly collected. Meanwhile, assessee approached the present AR to represent the cases. Ld. AR after study advised the assessee that the whole assessment was not maintainable and the earlier AR has misguided and mis-represented the case and not approached the case technically. With the advise of the present AR, assessee enlightened and filed the present appeal wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompany. The assessee requested for further adjournment to the TRO vide letter dated: 22.02.2017 signed by its Director. Further summons under Rule 83 of the Second Schedule was issued to the assessee by the TRO-1/ Hyderabod, on 25.05.2017. The assessee responded to the summons vide letter dated: 08.6.2017 and submitted details requisitioned. The assessee cannot claim ignorance of the effect of the appellate order of the Ld. CIT (Appeals) as the reason for delay in filing appeal before the Hon'ble ITAT. The facts discussed show that, that the reason adduced by the assessee for delay in filing appeal by 1274 days (appeal filed on 27.11.2017) is not credible and acceptable. 2.3 It is inconceivable that an assessee company, would rely on the version of its alleged Authorised Representative that it has got relief from the Ld. CIT (A) on its appeal and remain oblivious to the fact that, only partial relief has been granted to it by the Ld. CIT (Appeals), evident from the appellate order, consequential order passed to the appellate order received by the assessee on 12.11.2015 and the various notices issued by the TRO to the assessee as discussed above and to which the assessee has r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e legislature has conferred the power to condone delay by enacting s. 5 of the Limitation Act of 1963 in order to enable the Courts to do substantial justice to parties by disposing of matters on "merits". The expression "sufficient cause" employed by the legislature is adequately elastic to enable the Courts to apply the law in a meaningful manner which subserves the ends of justice-that being the life-purpose of the existence of the institution of Courts. It is common knowledge that this Court has been making a justifiably liberal approach in matters instituted in this Court. But the message does not appear to have percolated down to all the other Courts in the hierarchy. 4. And such a liberal approach is adopted on principle as it is realized that: 1. Ordinarily, a litigant does not stand to benefit by lodging an appeal late. 2. Refusing to condone delay can result in a meritorious matter being thrown out at the very threshold and cause of justice being defeated. As against this, when delay is condoned, the highest that can happen is that a cause would be decided on merits after hearing the parties. 3. "Every day's delay must be explained" does not mean that a pedant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13/12/2011. The reassessment completed u/s.143(3) r.w.s. 147, the AO added the difference between the value determined in valuation report and the value accounted for in books of account. It is pertinent to mention with reference to property at Roorkee the addition was made in all the three years - A.Ys. 2006-07, 2007-08 a 2008-09. With reference to property at Hyathnagar, Hyderabad, the addition was made only in A.Y.2006-07. 5. When the assessee preferred an appeal before the CIT(A), the CIT(A) partly allowed the appeal of the assessee and granted relief on valuation of property at Hyderabad. 6. Aggrieved by the order of the CIT(A), the assessee as well as revenue are in appeal before us. The assessee as well as revenue raised grounds against the order of CIT(A). Let us first deal with the assessee's appeal. 7. Before us, ld. AR submitted by way of three alternate submissions on validity of the reassessment, which are: a) AO cannot refer to DVO without rejecting the books, he submitted that a copy of the order sheet of original assessment which was completed u/s 143(3) as per which there is no trace of proposal to reject the books or any doubt expressed on the expenditure in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the Hon'ble Uttarkhand High Court in the case of Smt. Kiran Latha vs. ITAT (2009) 318 ITR 44 wherein it has been held that in a case where the Assessing Officer referred for the cost of construction u/s 142A to the DVO, and made addition u/s 69, rejection of books of accounts is implied. The Ld. CIT (A) has further held at Para 5.5 that, there is no pre-requisite that the Assessing Officer should reject the books of accounts before making the reference to the Departmental Valuation Officer. Even otherwise, the very fact that reference to the DVO has been made implies that AO had rejected the books of accounts. 4.4 During the course of appellate proceedings all the details submitted by the appellant during appeal proceedings were remanded to the Assessing Officer for fresh consideration. The AO also sent her remand report dated: 11.3.2014 and such remand report were sent to appellant for his comments by the Ld. CIT(Appeals). However, no reply was received from the assessee by the Ld. CIT (Appeals) on the same (Para 6.1 on Page 5 of the appellate order) 5. Roorkee Building: 5.1 Before the Ld. CIT(A) the assessee raised objections to the value determined of factory bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Valuation Officer was incorrect is not supported by facts of the case. Further, the Ld. CIT(A) also erred in disregarding the findings of the Valuation Officer in respect of second floor of the Building, holding that, Rs. 13,82,826/- does not pertain to the AY: 2006-07 to 2008-09 and the same shall not be considered by the AO for the purpose of section 69. It has already been submitted above that, the departmental valuation officer had estimated the cost of construction of the building which includes the second floor on the basis of the investment details submitted by the assessee. The Departmental Valuation Officer estimated the cost of construction of the property during the stated financial years, after carrying in out an inspection of the property which was carried out in the presence of the MD of the company. 5.4 In the light of the discussion made above, it is respectfully submitted that the appeal filed by the assessee on this ground is devoid of merits. 6. Hyathnagar Property: 6.1 Regarding the building at Hyathnagar, Hyderabad, the DVO determined the cost of building at Rs. 177.42 lakhs. According to the AO the amount reflected in books of accounts was Rs. 16.03 lak ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onstructed during the above period. He has only estimated the cost of construction in the buildings during the period mentioned in the Valuation Report. 7. In the light of the submissions made above it is humbly and respectfully submitted that the appeals filed by the assessee be dismissed and the order of the Assessing Officer restored." 9. Considered the rival submissions and perused the material on record. We notice that the original assessment was completed on 31/12/2008 and the order sheet for the assessment u/s 143(3) filed by the assessee, has no reference to valuation officer nor there is any reference to the non-satisfaction of the valuation or books submitted before the AO. The AO had referred the valuation to DVO on 17/11/2008. The DVO has issued notice for submission of requisite information to assessee on 21/08/2009, when the assessment was already completed by the AO on 31/12/2008. Even though, the matter was referred to DVO on 17/11/2008, the DVO has issued notice to AO only on 21/08/2009 calling for information. At the time of completion of assessment, there was no recording to such reference to DVO nor any indication of unsatisfaction on the records submitted by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Cements Corporation Pvt. Ltd. (supra) and Smt. Kiran Latha (supra) to submit that in a case where the AO referred for the cost of construction u/s 142A to the DVO, and made addition u/s 69, objection of books of account is implied. We do agree with the proposition but in the above cases, the facts were, the AO referred to the DVO during the assessment proceedings and assessee was confronted with the report during the assessment proceedings. But, in the given case, the books of account were accepted during assessment proceedings and assessments were also completed without even hint of any doubt on the figures submitted by the assessee. The assessee was never confronted with the valuation submitted and adopted by them in the books. Assessee came to know about the reference only after completion of the assessment u/s 143(3) i.e. when the assessee receives a letter from DVO office only 21/08/2009 (refer page 35 of the paper book). In the case of Bharati Cement, the AO did not accept the valuation shown by the assessee in the balance sheet, the observations in the said case are reproduced for the sake of clarity: "18. Even otherwise it may be noted here that in the course of previous ..... 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