9911796707
TMI Blog1995 (2) TMI 62X X X X Extracts X X X X X X X X Extracts X X X X ..... sue are as follows: The assessee filed a return for the assessment year 1976-77 under the Act, supported by a valuation given by a registered valuer. Holding that the value so returned is less than the fair market value of the property the Wealth-tax Officer referred the matter to the Valuation Officer under section 16A of the Act. Before the Valuation Officer had sent a copy of his order, the Wealth-tax Officer completed the assessment on the value returned by the assessee. It was thereafter that the Wealth-tax Officer received the order from the Valuation Officer. The Wealth-tax Officer issued notice under section 17(1)(b) for reassessment on the basis of the aforesaid report. After hearing the assessee, reassessment was completed. The as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h or the net wealth of such other person for that year, the net wealth chargeable to tax has escaped assessment for that year, whether by reason of underassessment or assessment at too low a rate or otherwise, he may, at any time within eight years serve on such person a notice containing all or any of the requirements which may be included in a notice under section 14(2), and may proceed to assess or reassess such net wealth. Section 17(1)(b) provides that in a case where the Wealth-tax Officer has, in consequence of any information in his possession, reason to believe, notwithstanding that there has been no such omission or failure as is referred to in clause (a), that the net wealth chargeable to tax has escaped assessment for any year, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e by a registered valuer, if the Wealth-tax Officer is of the opinion that the value so returned is less than its fair market value, he can refer it to the Valuation Officer. Section 16A(1)(b) states that in any other case, if the Wealth-tax Officer is of the opinion that the fair market value of the asset exceeds the value of the asset as returned by more than such percentage of the value of the asset as returned or by more than such amount as may be prescribed in this behalf, he can refer the valuation of any asset to the Valuation Officer. Equally it is open to the Wealth-tax Officer to refer to the Valuation Officer the valuation of any asset having regard to the nature of the asset and other relevant circumstances, if it is necessary s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Valuation Officer determined the market value of the assets on the income capitalisation method and on the basis of the order of the Valuation Officer, the Wealth-tax Officer reopened the assessments for the two years under section 17(1)(b) and completed the assessments by adopting the value as determined by the Valuation Officer and rejecting the contention of the assessee. This court held that pendency of assessment proceedings is a condition precedent for making a reference to the Valuation Officer under section 16A and as the assessments were completed, there cannot be any reassessment on the basis of the Valuation Officer's order subsequently sought for. In Brig B. Lall v. WTO [1981] 127 ITR 308, the Rajasthan High Court held in a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... caped assessment for any year, whether by reason of underassessment or assessment at too low a rate or otherwise, he is empowered to initiate action for reassessment. Of course, in a case where the assessment proceedings were completed, the Wealth-tax Officer cannot call for the order of the Valuation Officer. That is clearly unwarranted. As the order of the Valuation Officer was called for during the pendency of the assessment proceedings, it cannot be equated to a case where the order was sought for after the completion of the assessment as in the case in CWT v. Ravi Cheloor [1989] 178 ITR 640 (Ker) and Brig B. Lall v. WTO [1981] 127 ITR 308 (Raj). In the case on hand though assessment was completed even before the Valuation Officer's ord ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aluation Officer as provided under section 16A(1)(b) will not be there as the order reached the Wealth-tax Officer not before the assessment proceedings were completed. The resultant position is that the order of the Valuation Officer received subsequent to the completion of the assessment proceedings can only be used as a piece of information which certainly would enable the Wealth-tax Officer to commence reassessment proceedings. Accordingly, we dispose of the reference by answering the question against the assessee and in favour of the Revenue. Communicate a copy of this judgment under the seal of this court and the signature of the Registrar to the Income-tax Appellate Tribunal, Cochin Bench, for information. - - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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