THE HIGH COURT OF DELHI AT NEW DELHI
% Judgment delivered on: 23.01.2013
+ ITA 42/2013
COMMISSIONER OF INCOME TAX ... Appellant
versus
ABHINAV KUMAR MITTAL ... Respondent
Advocates who appeared in this case:
For the Appellant : Mr Sanjeev Rajpal
For the Respondent : None
CORAM:-
HON'BLE MR JUSTICE BADAR DURREZ AHMED
HON'BLE MR JUSTICE R.V.EASWAR
JUDGMENT
BADAR DURREZ AHMED, J (ORAL)
1. This appeal has been filed by the revenue against the order dated
29.06.2012 passed by the Income Tax Appellate Tribunal in ITA
4460/Del/2010 pertaining to the assessment year 2006-07.
2. The facts are that the respondent/ assessee had filed a return
declaring an income of ` 39,90,410/- on 18.07.2006. Subsequently, a
search was conducted under Section 132 of the Income Tax Act, 1961
ITA 42/2013 Page 1 of 5
(hereinafter referred to as `the said Act') on 26.04.2007 as also a survey
operation under Section 133A in the premises of A. K. Capital Services
Limited and its group companies as also in the premises of the Directors
of those companies and their relatives. Thereafter, a notice under Section
153C of the said Act was issued on 07.10.2009. A response was issued
by the assessee by their letter dated 13.10.2009 and the return already
filed on 18.07.2006 was requested to be treated as the return in response
to the said notice under Section 153C.
3. The Assessing Officer, in the course of the assessment
proceedings, considered the valuation of three properties which had been
purchased by the assessee in the relevant year. The three properties
included two office premises at Ahmedabad and one commercial property
at Kolkata. The Assessing Officer referred the question of valuation of
the said properties to the District Valuation Officer (DVO). The DVO
submitted his report on 14.12.2009 in respect of the Ahmedabad
properties and on 24.12.2009 in respect on the Kolkata property. As per
the said report, the DVO has valued the said properties as under:-
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Sl. Address of the Value Value Difference
No. property determined declared by [in ` ]
by DVO the assessee
[in ` ] [in ` ]
(i) 101, Kaivana 44,00,600/- 18,00,000/- 26,00,600/-
Building Malkans,
Near Polytechnic
Ahmedabad
(ii) 102, Kaivana 41,57,300/- 17,36,000/- 24,21,300/-
Building Malkans,
Near Polytechnic
Ahmedabad
(iii) Commercial 43,19,800/- 32,11,680/- 11,08,120/-
Property
Chowranghee,
Kolkata
4. The difference in the values, as declared by the assessee and as
opined by the DVO, amounted to ` 50,21,900/- in respect of the
properties at Ahmedabad and an amount of ` 9,57,038/- was the
difference in respect of the Kolkata property. These additions were made
by the Assessing Officer under Section 69 of the said Act.
5. Being aggrieved by the said additions, the assessee preferred an
appeal before the Commissioner of Income Tax (Appeals), who deleted
the additions. The Income Tax Appellate Tribunal confirmed the said
deletion. The issue that is sought to be raised here is that the deletion was
ITA 42/2013 Page 3 of 5
not in accordance with law. However, we find that the Income Tax
Appellate Tribunal as well as the Commissioner of Income Tax (Appeals)
had concluded, on facts, that there was no material found during the
search to justify the reference to the DVO for his valuation of the said
properties. The Tribunal held that there must be some material to show
that the investment made by the assessee was outside the books. This,
according to the Tribunal, was a condition precedent for making a
reference to the DVO. The Tribunal also held that, in any event, the
DVO's report was based on incomparable sales and, therefore, could not
be relied upon. The Tribunal also held that the burden was on the
revenue to show that the real investment in the said properties was greater
than the apparent investment, as disclosed by the respondent/ assessee.
The Tribunal held, on facts, that the said burden had not been discharged
by the revenue. Consequently, the Tribunal held in favour of the assessee
and against the revenue and found that the reference to the DVO itself
was not in accordance with law.
6. We have no reason to differ from the view taken by the Tribunal,
particularly, as no material was found in the search and seizure
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operations, which would justify the Assessing Officer's action in
referring the matter to the DVO for his opinion on valuation of the said
properties. If that be the case, then the valuation arrived at by the DVO
would be of no consequence. In any event, the Tribunal has also, on
facts, held that the DVO's valuation was based on incomparable sales,
which is not permissible in law.
7. For these reasons, no question of law arises for our consideration.
The appeal is dismissed. There shall be no order as to costs.
BADAR DURREZ AHMED, J
R.V.EASWAR, J
JANUARY 23, 2013
SR
ITA 42/2013 Page 5 of 5
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