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TMI Blog2011 (2) TMI 1626X X X X Extracts X X X X X X X X Extracts X X X X ..... f the property. 2. We have heard the learned DR and perused the findings of the authorities below. None appeared on behalf of the assessee despite service of notice through registered post. A/D card duly served upon the assessee is on record. The assessee is, therefore, proceeded ex parte . 3. Briefly, the facts of the case are that the AO made addition of Rs.36,71,532/- on the basis of difference in the valuation of cost of construction determined by the DVO and the cost disclosed by the assessee in its books of account. In the assessment order the AO has stated that during the course of original assessment proceedings, the matter of determining of fair valuation of the multiplex constructed by the assessee was referred to the DV ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against the assessee to establish that any of the expenditure has not been recorded by the assessee in the books of account. It was further contended that there was no fault on the part of the assessee for filing the submission. It was further submitted that the difference worked out by the DVO in his report is not considerable as it was worked out to 5.46% of the total cost incurred. Therefore, the addition should not have been made on mere estimate. The assessee relied upon the following decisions: (1) ACIT Vs Radheshyam Poddar 86 TTJ (Asr) 558 (2) ACIT Vs Bandana Roy 77 TTJ (Gau) 66 (3) CIT Vs Kushal Chand Nirmal Kumar 183 CTR 503 (MP) (4) CIT Vs S. K. Construction 167 Taxman 171 (Del) (5) CIT Vs Merrut Cement Co. Pvt. Lt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t of the DVO which itself bears several defects. These defects have been mentioned on page seven of this order as much as certain values have been taken twice like in respect of kitchen equipment, acoustics and glow signs etc. Similarly factual errors resulting in difference on account of figures taken by the DVO and amounts of fee paid to architect have remained to be considered for working of difference. Any reasonable reconciliation with above inclusions would take away the justification for the addition so made by the AO. In the circumstances, merely on the basis of the difference in the value as per the valuation report and the actual cost incurred, the addition cannot be made. It should be logical and proper. The addition is therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orded by the Tribunal that the books of account were never rejected. Decision of the Uttaranchal High Court reversed. We may further note here that the AO has noted that cost of the construction worked out by the DVO for assessment year under appeal comes to Rs.7,08,02,769/- against the cost of construction declared by the assessee in a sum of Rs.6,71,31,237/-. The assessee pleaded before the learned CIT(A) that the said difference is negligible because it is hardly 5.46% of the total cost incurred. Since no defects have been pointed out in the maintenance of the books of accounts before making reference to the DVO and the difference is negligible as against the cost of construction declared by the assessee, we are of the vie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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