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TMI Blog2021 (2) TMI 132X X X X Extracts X X X X X X X X Extracts X X X X ..... t valuation report and completed the assessment. As seen from the assessment order that the AO had made enquiries in respect of the cost of construction and it cannot be said that no query was raised by the AO in respect of the cost of construction. In our considered opinion it is not open to enquire in case of inadequate enquiry. Infact in the case in hand the facts clearly show that adequate enquiries were made by the AO which were duly replied by the assessee. We find that the AO has taken one of the plausible view and the Pr. CIT cannot substitute his view with that of the AO - Decided in favour of assessee. - ITA No. 2040/DEL/2015 - - - Dated:- 3-2-2021 - SH. N. K. BILLAIYA, ACCOUNTANT MEMBER AND MS SUCHITRA KAMBLE, JUDICIAL MEMBER Appellant by : Sh. Ashok Malik , Advocate Respondent by : Sh. Satpal Gulati , CIT DR ORDER PER N. K. BILLAIYA , AM : With this appeal the appellant has challenged the assumption of jurisdiction u/s. 263 of the Act, 1961 by the Pr. CIT-10, New Delhi. 2. The assessee contends that the assessment order dated 31.03.2010 framed u/s. 143 (3) of the Act, is neither erroneous nor prejudicial to the interest of the Reve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 110065 Sir/Madam, Sub: Your assessment for A.Y. 2010-11 -Initiation of Revision Proceedings u/s 263 of the Income Tax Act, 1961- Notice of hearingreg. (PAN:AAAHY3243D) Please refer to the above. 2. The assessment in your case for the A.Y. 2010-11 was completed u/s 143(3) of the Income-tax Act, 1961 on 26.03.2013. On examination of the records, it is prima-facie seen that the assessment order passed by the AO is erroneous in so far as it is prejudicial to the interest of the revenue for the reason mentioned below: On going through the case records, it has been noted that during the assessment proceedings, you have submitted different values in respect of cost of construction of the property B-493, New Friends Colony, New Delhi-110065 on various dates. On 18.12.2012, the valuation report of a Registered Valuer dated 15.12.2012 was filed in respect of building cost of immovable property at ₹ 1,82,43,000/- which was exclusive of additional expenses i.e. Architect Fee MOD Sanction Plan Fee amounting to ₹ 21,11,458/-. On 11.02.2013, another valuation report of a registered valuer dated 15.12.2013 was filed and in this report the fair market val ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ort in which the fair market value of the building cost of the property is shown at ₹ 1,02,61,710/-. Thus, the order of Assessing Officer as he has not recorded reasons for accepting the claims of the assessee is erroneous and prejudicial to the interest of revenue. 11. The Assessing Officer has completed the assessment without making requisite enquiry and also without due application of mind. Thus the impugned assessment order is erroneous in so far it is prejudicial to the interest of revenue and is liable to be set-aside. Accordingly, in the exercise of revisionary powers u/s 263 of Income Tax Act, 1961, the assessment of A. Y. 2010-11 completed u/s 143(3) on 26.03.2013 is hereby set-aside to the Assessing Officer to make assessment de-novo after examining the correctness of various claims made and income shown by the assessee, after affording reasonable opportunity of being heard to the assessee. 12. Before us the counsel for the assessee reiterated what was stated before the AO. It is the say of the counsel that the AO has accepted the second valuation report as the same valued the property correctly and, therefore, the order is neither erroneous nor prejudic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on of law:- Whether the Tribunal is right in law and on facts in upholding the order passed by the CIT under section 263 of the Act on merits and still storing the issue of allowability of deduction under section 54 of the Act to the file of Assessing Officer even though the working of allowability of deduction under section 54F is available in the order under section 263 which is not disputed by the assessee before ITAT. 16. And the Hon'ble High Court, after considering the facts, held as under:- 6. It can thus be seen that though final order of assessment was silent on this aspect, the Assessing Officer had carried out inquiries about the nature of sale of land and about the validity of the assessee's claim of deduction under section 54F of the Act. Learned counsel for the Revenue however submitted that these inquiries were confined to the claim of deduction under section 54F of the Act in the context of fulfilling conditions contained therein and may possibly have no relevance to the question whether the sale of land gave rise to a long term capital gain. Looking to the tenor of queries by the Assessing Office and details . A.Y. 2009-10 supplied by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may pass revisional orders. If, on the other hand, the CIT is satisfied, after hearing the assessee, that the orders are not erroneous and prejudicial to the interest of the Revenue, he may choose not to exercise his power of revision. This is for the reason that if a query is raised during the course of scrutiny by the AO, which was answered to the satisfaction of the AO, but neither the query nor the answer were reflected in the assessment order, this would not by itself lead to the conclusion that the order of the AO called for interference and revision. In the instant case, for example, the CIT has observed in the order passed by him that the assessee has not filed certain documents on the record at the time of assessment. Assuming it to be so, in our opinion, this does not justify the conclusion arrived at by the CIT that the AO had shirked his responsibility of examining and investigating the case. More so, in view of the fact that the assessee explained that the capital investment made by the partners, which had been called into question by the CIT was duly reflected in the respective assessments of the partners who were I.T. assessees and the unsecured loan taken from M/s S ..... 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