ORDER SHEET GA No.1617 of 2016 I.T.A.T. No.211 of 2016 IN HIGH COURT AT CALCUTTA Special Jurisdiction (Income Tax) ORIGINAL SIDE IN MATTER OF: PRINCIPAL COMMISSIONER OF INCOME TAX, KOLKATA-17, KOLKATA. Versus SMT. KABITA DAS(SAHA) BEFORE: Hon'ble JUSTICE ANIRUDDHA BOSE Hon'ble JUSTICE ARINDAM SINHA Date : 6th December, 2017. Appearance: Mr.P. Dudheria, Advocate. ..for Revenue. Mr.Ananda Sen, Advocate Mr. Arnab Chakraborty, Advocate. Mr. Prasenjit Saha, Advocate. Mr. S. Mondal, Advocate. for Respondent. Arindam Sinha, J. :-Revenue seeks to appeal against order dated 30th November, 2015 passed by Income Tax Appellate Tribunal, Bench, Kolkata in ITA no.2175/Kol./2010 pertaining to assessment year 2005-06. Mr. Dudheria, learned Advocate appearing for Revenue, urged question (a) of suggested questions for admission of appeal. said suggested question is reproduced below: 2 (a) Whether on facts and in circumstances of case Learned Income Tax Appellate Tribunal, Bench, Kolkata erred in law in holding that no addition U/s.69B of Income Tax Act, 1961 can be made for unaccounted investment made in purchase of property solely on basis of DVO s report without considering fact that no defect was found in valuation report and circle rate value of property mentioned in Registered Sale Deed has also been found to substantially higher than payment of consideration declared in sale deed ? Mr. Dudheria submitted that assessee purchased commercial immovable property of carpet area 3405 sq. ft. in building known as Ready Money Terrace at 167, Dr. Annie Besant Road, Worli, Mumbai-400018 by deed of transfer dated 24th December, 2004 for apparent consideration of Rs.1.5 crores and expenses of Rs.12.3 lakhs having been incurred thereon. registering authority took value of property at Rs.2,40,14,500/- for purpose of registration and realised stamp duty accordingly. assessee did not agitate against increased valuation which was Rs.77,84,500/- higher than apparent consideration of Rs.1.5 crores. He submitted that this prompted Assessing Officer to get valuation of property from Departmental Valuation Officer (VO). departmental 3 valuation cell reported value of property at Rs.2,99,04,888/-. difference in value attributed by Departmental Valuation Cell and apparent consideration paid being Rs.1,49,04,888/-, same was added back as unexplained investment by applying provisions of section 69B of Income Tax Act, 1961. He submitted, assessment thus made was erroneously set aside by CIT(A) as confirmed by Tribunal. It is his further submission that Assessing Officer proceeded correctly since it is common knowledge that commercial property in Worli, Mumbai is prime real estate and price paid at Rs.4,767/- per sq.ft. was rightly disbelieved by Assessing Officer. Mr. Sen, learned Advocate appearing on behalf of assessee, submitted with reference to order of CIT(A) that his client, to buy peace of mind and avoid confrontation with State Government authorities, had not challenged value attributed to property by registering authority and accepted by appellate authority. According to him, CIT(A) had correctly relied upon several decisions to set aside addition. facts were that in instant case Assessing Officer had not brought anything on record to show that some consideration over and above consideration recorded in deed of sale in respect of flat purchased by her at Mumbai was actually paid by her. He submitted that there were several decisions of different High Courts in support of assessee s case, of which he relied on case of CIT vs- Bajranglal Bansal, 4 decided by Delhi High Court, reported in (2011) 335 ITR 572(Delhi). Paragraphs 7 and 8 of that judgment are reproduced below: 7. In any event, opinion of DVO, per se, is not information and cannot be relied upon without books of account being rejected which has not been done in present case. Supreme Court in its order dated October 19, 2009, in Civil Appeal No.6973 of 2009 has held as under (See Sargam Cinema v. CIT [2010] 328 ITR 513(SC): Delay condoned. Leave granted. By consent, matter is taken up for final hearing. In present case, we find that Tribunal decided matter rightly in favour of assessee inasmuch as Tribunal came to conclusion that assessing authority (AO) could not have referred matter to Departmental Valuation Officer (DVO) without books of account being rejected. In present case, categorical finding is recorded by Tribunal that books were never rejected. This aspect has not been considered by High Court. In circumstances, reliance placed on report of DVO was misconceived. 5 For above reasons, impugned judgment of High Court is set aside and order passed by Tribunal stands restored to file. Accordingly, assessee succeeds. Civil appeal is allowed. No order as to costs. 8. Further, Supreme Court in its order dated February 16, 2010, in Civil Appeal No.9468 of 2003 [See Asst. CIT v. Dhariya Construction Co. [2010] 328 ITR 515 (SC)] has held: Having examined record, we find that in this case, Department sought reopening of assessment based on opinion given by District Valuation Officer (DVO). opinion of DVO per se is not information for purposes of reopening assessment under section 147 of Income-tax Act, 1961. Assessing Officer has to apply his mind to information, if any, collected and must form belief thereon. In circumstances, there is no merit in civil appeal. Department was not entitled to reopen assessment. civil appeal is, accordingly, dismissed. No order as to costs. Moreover, in present case, no evidence much less incriminating evidence was found as result of search to 6 suggest that respondent-assessee had made any payment over and above consideration mentioned in return of respondent-assessee. He then handed up copy of order dated 21st April, 2011 made by Supreme Court of India rejecting petition for special leave to appeal preferred by Revenue, registered as Petition(s) for Special Leave to Appeal (Civil) ./2011 (CC 6666/2011) (C.I.T-II, Petitioner (s) VERSUS BAJRANG LAL BANSAL, Respondent(s). He submitted, Tribunal found no infirmity in order of CIT(A) and dismissed appeal taken before it by Revenue. According to him there is no substantial question of law involved in case. provisions in sections 69 and 69B relate to unexplained investments. Both sections proceed on basis that assessee had made investments which were not recorded in books of account, if any, maintained by him for any source of income and no explanation is offered or explanation offered is found to be unsatisfactory by Assessing Officer. Revenue was unable to bring to our notice discovery of any amount, over and above consideration disclosed, as invested by assessee for purpose of purchasing property. There is thus no evidence on record to show that any amount in excess of amounts recorded in books of account was spent by assessee with regard to purchase of property. From materials on record, we find that Assessing Officer has not undertaken any independent decision making process for analysing DVO s report but depended on DVO s information gathering process only. In such 7 circumstances, condition precedent for applicability of section 69B was not fulfilled. For reasons aforesaid, we do not find any question of law, let alone substantial question of law, is involved in this case. appeal and application are accordingly dismissed. (ANIRUDDHA BOSE, J.) (ARINDAM SINHA, J.) nm/tk Principal Commissioner of Income-tax, Kolkata-17, Kolkata v. Kabita Das (Saha)