Chitta Prasad Ghosh, Bhubaneswar V. ACIT, Bhubaneswar

ITA 114/CTK/2012

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 65087 (ITAT-CUTTACK)
• Duration Of Justice: 6 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-08-2012
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 06-08-2012
• Assessment Year: 1982-1983
• Appeal Filed On: 09-02-2012
• Court: TRIBUNAL
• Department Lawyers: S C MOHANTY
• Assessee Lawyers: B PANDAB K PANDAARS
• Keywords: Unexplained investment; Principle of natural justice; Valuation report

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK ( ) BEFORE . . , , HONBLE SHRI K.K.GUPTA, ACCOUNTANT MEMBER. /AND . . . , HONBLE SHRI K.S.S.PRASAD RAO, JUDICIAL MEMBER / I.T.A.NO. 114,115,116,117 AND 118/CTK/2012 ( / ASSESSMENT YEAR S 1982 - 83, 86,1986 - 87, 1987 - 88 AND 1989 - 90) SRI CHITTA PRASAD GHOSH, 269/1465, CUTTACK ROAD, BHUBANESWAR. PAN: AAU PG 8636 L - - - VERSUS - ASST.COMMISSIONER OF INCOME - TAX, CIRCLE 1(1), BHUBANESWAR. ( /APPELLANT ) ( / RESPONDENT ) / FOR THE APPELLANT : / SHRI B.PANDA/B.K.PANDA,ARS / FOR THE RESPONDENT: / SHRI . S.C.MOHANTY , DR / DATE OF HEARING: 06.08.2012 / DATE OF PRONOUNCEMENT: 14.08.2012 / ORDER . . , , SHRI K.K.GUPTA, ACCOUNTANT MEMBER . THESE APPEALS FOR THE AYS 1982 - 83, 86,1986 - 87, 1987 - 88 AND 198 9 - 90 ARE AGAINST THE ORDERS OF THE LEARNED CIT(A) WHEN THE ISSUES DEALT WITH IN HAVE SUFFERED RESTORATION BY THE TRIBUNAL TWICE AND ONCE TO THE ASSESSING OFFICER BY THE LEARNED CIT(A) AND ONCE BY THE TRIBUNAL ON CIT(A)S ORDER ARE BEING TAKEN UP FOR HEARIN G TOGETHER CONDONING THE DELAY FOR FILING THE APPEAL AS PER THE CONDONATION PETITION FILED ALONG WITH MEDICAL CERTIFICATE IN VIEW OF THE AYS INVOLVED AND ISSUES HAVING BEEN CONSIDERED BY THE APPELLATE AUTHORITIES EARLIER. 2. THE LEARNED COUNSEL FOR THE AS SESSEE INITIATING HIS ARGUMENTS CLARIFIED THE BROUGHT FACTS ON RECORD AS FOLLOWS : THE ABOVE NAMED ASSESSEE SRI C. P. GHOSH WAS IN INDIAN NAVY AND ASSESSED TO INCOME TAX FROM THE ASSESSMENT YEAR, 1969 - 70 I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 2 VIDE HIS GIR NO.723(C). DURING THE ASSESSMENT YEARS , 1973 - 74 HE JOINED IN THE FIRM M/S. GHOSH &CO. AS ITS MANAGING PARTNER AND SUBSEQUENTLY JOINED IN TWO OTHER PARTNERSHIPS FIRM WHICH ARE ALSO CONTRACT FIRMS SUCH AS M/S. GHOSH CONSTRUCTION AND M/S. NATIONAL CONSTRUCTION WHICH ARE ASSESSED UNDER INCOME TAX OFFICER, PURL. 2. THAT OVER AND ABOVE, THE ASSESSEE SRI C.P. GHOSH ALONG WITH HIS PARTNERS OF GHOSH & CO. WHO ARE ALSO THE FAMILY MEMBERS OF THE ASSESSEE HAD DISCLOSED BULK AMOUNT UNDER VOLUNTARY DISCLOSURE SCHEME, 1975 THAT IS A SUM OF RS.25,000/ - EACH T OTALING TO RS.1,50,000/ - WHICH WERE UTILIZED BY THE ASSESSEE IN INVESTING THOUGH HOUSE BUILDING AND PURCHASE OF NSC AND UTI ETC. THEREFORE THE DETAILS OF INVESTMENT ETC. ARE EXPLAINED AS UNDER. ASSESSMENT YEAR 198 2 - 83 (A) THAT FOR THE ASSESSMENT YEAR 1982 - 83 INCOME SHOWN AT RS.13,608/ - AGAINST WHICH THE ASSESSMENT WAS MADE AND A SUM OF RS.43,500/ - AND RS.7,000/ - WERE ADDED TO THE INCOME AS ALLEGED CONCEALED AMOUNT U/S. 69 FOR CONSTRUCTION OF HOUSE PROPERTY AND TOWARDS HOUSEHOLD EXPENSES. (B) THAT THE VALUAT ION OF CONSTRUCTION OF THE HOUSE PROPERTY MADE BY THE DEL3ARTMENTAL VALUATION OFFICER ON 04.2.1992 FOR RS.43,500/ - BUT FOR THE ASSESSMENT YEAR 1982 - 83 THE INVESTMENT WAS ONLY 30,000 WHICH WAS INCURRED DURING THE FINANCIAL YEARS 1980 - 81 TO 1981 - 82 OUT OF THE PREVIOUS SAVINGS OF THE ASSESSEE WHO WAS ASSESSED FROM 1969 - 70 AND ALSO HAD DISCLOSED VDIS FOR 25,000 ON 6.5.1976 WITH HIS RELATIVES AT 1,50,000. (C) THAT THE VALUATION R EPORT MADE BY THE DEPARTMENTAL VALUATION OFFICER ON 4.2.92 HAD NOT CORRECT REFLECTED THE FACTS ON CONSTRUCTION WORKS. IT IS HIGHLY EXCESSIVE DETERMINING AT RS.2,02,000/ - ON 4.2.92 AGAINST THE VALUATION MADE BY THE REGISTERED VALUER AT RS.1,28,100/ - ON 17.3 .92. MOREOVER, THE WORKS WHICH WERE NOT COMPLETED AS FOUND ON 17.3.92 IN RESPECT OF STAIR CASE, HAND RAIL, OUTSIDE PLASTER AND TERRACING ETC. HAVE I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 3 NOT BEEN REFLECTED IN THE DEPARTMENTAL VALUERS REPORT AND NO DEDUCTIONS HAVE BEEN CONSIDERED FOR THAT INCOMP LETED WORK BY THE DEPARTMENTAL VALUATION OFFICER. THE COPY OF THE VALUATION MADE BY THE D.V.O. AND REGISTERED VALUER ARE ALREADY AVAILABLE IN THE FILE MAY PLEASE BE REFERRED TO. (D) THAT THE VALUATION REPORT OF THE REGISTERED VALUER ON 17. 3.92 CLEARLY IND ICATED THAT TILL 17.3.92 SOME INCOMPLETE WORKS WERE THERE AS BECAUSE CONSTRUCTION OF BUILDING WORK WAS DONE IN A CONTINUOUS AND GRADUAL PROCESS DURING THE YEARS TOGETHER BUT NOT COMPLETED UP TO ASSESSMENT YEAR 1985 - 86 AND 1986 - 87. HAD IT BEEN A CASE THAT T HE BALANCE INCOMPLETE WORK WAS COMPLETED DURING THE PERIOD AND THERE WOULD HAVE BEEN NOTHING LEFT OUT AS ON THE DATE OF REPORT. AS SUCH, THE VALUATION REPORT MADE BY THE D.V.O. FOR THE ASSESSMENT YEAR 1982 - 83, 1985 - 86 AND 1986 - 87 IS NOT BASED ON REAL FACT S THUS IS EXCESSIVE AND THE ADDITIONS MADE ON THIS ACCOUNT ARE LIABLE TO BE DELETED. MOREOVER, THE REPORT THE DVO AS WELL AS REGD. VALUER WERE ONLY ON GUESS WORK AND THE APPELLANT BEING THE WORKS CONTRACTOR HAD USED HIS SKILLED MAN AND MACHINERY AND EXECUT ED THE WORK IN MOST ECONOMICAL AND SIMPLE WAY AT LESSER PRICE. THE OBJECTION OF THE ASSESSEE ON THE VALUERS REPORT WHICH HE VEHEMENTLY OBJECTED ON THE GROUND THAT DELHI RATE AS ADOPTED CAN NOT BE APPLIED IN THE ASSESSEES CASE AT BHUBANESWAR WHICH IS HIGH LY EXCESSIVE EVEN THROUGH REFLECTED IN THE ASSESSMENT ORDER DTD.15.02.1992 HAS NOT BEEN ACCEPTED BY THE ID. AO ARBITRARILY AND SUCH THE ADDITION MADE IS LIABLE TO BE DELETED. (E) AS SUCH THE ADDITIONS MADE TOWARDS CONSTRUCTION OF BUILDING FOR THE ASSESSMEN T YEAR 1982 - 83 FOR RS.43,500/ - BASED ON THE DEPARTMENT VALUATION ON 04.02.1992 WAS EXCESSIVE AND LIABLE TO BE DELETED WITH REFERENCE TO 200 ITR PAGE 785 HOTEL AMAR VR.CIT, ORISSA. (F) THAT THE WIFE OF THE ASSESSEE SMT. MUKTIRANI GHOSH IS AN INCOME HAVING P AN 16 - 006 - PN - 0683 SINCE ASSESSMENT YEAR 1986 - 87 AND WAS IN SERVICE IN NATIONAL TEXTILE CORPORATION, A I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 4 GOVERNMENT OF INDIA UNDERTAKING DURING THE ASSESSMENT YEAR 1982 - 83 AND AS SUCH THE HOUSE HOLD EXPENSES BEYOND 5,000 WAS INCURRED FROM HER SALARY. AS SUCH, THE ADDITIONS MADE FOR 7,000 (12,000 5,000) TOWARDS HOUSEHOLD EXPENSES IS LIABLE TO BE DELETED SINCE THE FAMILY SIZE WAS SMALL AND LEAD SIMPLE LIVING. ASSESSMENT YEAR 1985 - 86 AND 1986 - 87. (A) THAT THE ADDITI ONS MADE ON CONSTRUCTION OF HOUSE BUILDING FOR RS.43,484/ - AND RS.43,495/ - FOR THE ASSESSMENT YEAR 1985 - 86 AND 1986 - 87 RESPECTIVELY BY DEPARTMENTAL VALUATION OFFICER ON 04.02.1992 IS EXCESSIVE AND NOT BASED ON PROPER FACTS. ACTUALLY, THE EXPENDITURE MADE O N CONSTRUCTION OF HOUSE BUILDING DURING THE FINANCIAL YEAR 1984 - 85 AND 1985 - 86 IS ABOUT RS.30,000/ - WHICH HAS BEEN SPENT OUT OF WITHDRAWALS FROM THE FIRM FOR RS.27,000/ - AND BALANCE FROM THE PREVIOUS SAVINGS SUBMITTED. THE VALUATION MADE BY THE DEPARTMENTA L VALUATION OFFICER ON 04.02.92 HAD NOT CORRECTLY REFLECTED THE FACTS ON CONSTRUCTION WORKS AFTER FINANCIAL YEAR 1986 - 87 TO 1991 - 92 WHICH HAS BEEN MADE OUT OF THE EARNINGS FOR THE ASSESSMENT YEAR 1987 - 88 TO 1992 - 93 AND SURPLUS AMOUNT OUT OF N.S.C. INVESTME NT AND REALIZATION AND WITHDRAWAL OF CAPITAL FROM THE FIRM M/S. GHOSH &CO. DURING FEBRUARY, 1988. THE CONSTRUCTION WORK WAS A CONTINUOUS PROCESS AND THE REPORT OF THE REGISTERED VALUER ON 17.3.92 REVEALED THE FACTS WHICH WERE NOT COMPLETED IN RESPECT OF ST AIR CASE, HAND RAIL, OUTSIDE PLASTER AND TERRACING ETC. FOR WHICH THE HE HAS DEDUCTED RS.9,060/ - FROM THE TOTAL VALUATION MADE BY HIM. (B) THAT THE VALUATION REPORT OF THE REGISTERED VALUER ON 17.3.92 CLEARLY INDICATED THAT TILL 17.3.92 SOME INCOMPLETE WOR KS WERE THERE AS BECAUSE CONSTRUCTION OF BUILDING WORK WAS DONE IN A CONTINUOUS AND GRADUAL PROCESS DURING THE YEARS TOGETHER BUT NOT COMPLETED DURING THE ASSESSMENT YEAR 1985 - 86 AND 1986 - 87. HAD IT BEEN A CASE THAT THE BALANCE INCOMPLETE WORK WAS COMPLETE D DURING THE PERIOD AND THERE WOULD HAVE BEEN NOTHING LEFT OUT AS ON THE DATE OF REPORT. AS SUCH, THE I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 5 VALUATION REPORT MADE BY THE D.V.O. FOR THE ASSESSMENT YEAR 1985 - 86 AND 1986 - 87 IS NOT BASED ON REAL FACTS THU S IS EXCESSIVE DETERMINING THE FACT OF CONST RUCTION AT RS.2,02,000/ - ON 4.2.92 AGAINST THE VALUATION MADE BY THE REGISTERED VALUER AT RS.1,28,100/ - ON 17.3.92 AND THE ADDITIONS MADE ON THIS ACCOUNT ARE LIABLE TO BE DELETED. MOREOVER, THE REPORT THE DVO AS WELL AS REGD. VALUER WERE ONLY ON GUESS WORK AND THE APPELLANT BEING THE WORKS CONTRACTOR HAD USED HIS SKILLED MAN AND MACHINERY AND EXECUTED THE WORK IN MOST ECONOMICAL AND SIMPLE WAY AT LESSER PRICE. THE OBJECTION OF THE ASSESSEE ON THE VALUERS REPORT WHICH HE VEHEMENTLY OBJECTED ON THE GROUND TH AT DELHI RATE AS ADOPTED CAN NOT BE APPLIED IN THE ASSESSEES CASE AT BHUBANESWAR WHICH IS HIGHLY EXCESSIVE EVEN THROUGH REFLECTED IN THE ASSESSMENT ORDER DTD.15.02.1992 HAS NOT BEEN ACCEPTED BY THE ID. AC ARBITRARILY AND SUCH THE ADDITION MADE IS LIABLE T O BE DELETED. (C) THAT AS SUBMITTED ABOVE, THE COST OF CONSTRUCTION OF THE BUILDING SHOWN BY THE ASSESSEE AT RS.1,28,100/ - AS AGAINST D.O.VS REPORT ESTIMATED AT RS.2,02,000/ - BUT IN THIS CASE THE ASSESSEE HAS BORROWED A SUM OF RS.80,000/ - (RUPEES EIGHTY THOUSAND) RS.40,000/ - EACH FROM ONE SHAKTI PRASAD GHOSH AND SRI RAM PRASAD GHOSH BEING THE BROTHERS AND THE AMOUNT WAS PAID TO THE ASSESSEE ON PIECEMEAL BASIS WITH THE UNDERSTANDING THAT SINCE THE HOUSE IS CENTRALLY LOCATED AT BHUBANESWAR BUT FOR THE PUR POSE OF PILGRIMAGE TO BHUBANESWAR, PUN AND KONARK IT WOULD BE AN IDEAL FOR THEM TO STAY IN THE HOUSE FOR A SHORT PERIOD TO PERFORM HOLY, RELIGIOUS AND SPIRITUAL ACTIVITIES. ACCORDINGLY THEIR INVESTMENT IN THE HOUSE PROPERTY AT RS.80,000/ - BEING THE BORROWE D INVESTMENT MADE MAY KINDLY BE CONSIDERED ON THE BASIS OF THEIR COPIES OF AGREEMENT FILED. THE TOTAL INVESTMENT IN THE BUILDING BEING AT RS.1,28,100/ - INCLUDING THE BORROWED AMOUNT MAY PLEASE BE ACCEPTED AND FURTHER THE ASSESSEE BEING A CONTRACTOR THE INV ESTMENT IN THE CONSTRUCTION OF THE HOUSE WAS VERY MINIMUM AND ECONOMICAL ALSO MADE WITH PLAIN MANNER. I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 6 (D) THAT AS STATED EARLIER , THE WIFE OF THE ASSESSEE IS AN INCOME TAX ASSESSEE AND SERVICE HOLDER AND SHE MANAGES THE HOUSE HOLD EXPENSES FROM HER SALARY . AS SUCH, THE ADDITIONS MADE TOWARDS HOUSEHOLD EXPENSES FOR THE CORRESPONDING FINANCIAL YEARS ARE LIABLE TO BE DELETED. ASSESSMENT YEAR 1987 - 88 (A) THAT THE ASSESSEE HAD PURCHASED TWELVE NUMBER OF N.S.CS FOR RS.16,000/ - DURING NOVEMBER, 1980 TO DECEMBER, 1980 WHICH WERE ENCASHED ON MATURITY AFTER SIX YEARS FOR RS.32,000/ - AND OUT.OF THAT RS.30,000/ - WAS REINVESTED ON NSC DURING ASSESSMENT YEAR - 1987 - 88. AS SUCH, THE ADDITIONS MADE TOWARDS UNEXPLAINED INVESTMENT IN PURCHASE OF NSC FOR RS.30,000/ - ARE LIABLE TO BE DELETED. THE DETAILS OF N.S.CS ARE GIVEN BELOW. ASSESSMENT YEAR 1989 - 90. (A) THAT THE INVESTMENT MADE IN U.T.I. FOR RS.41,000/ - DURING THE ASSESSMENT YEAR 1989 - 90 WAS OUT OF FUND WITHDRAWN FROM ANDHRA BANK DURING OCTOBER, 1998 FOR RS.15,000/ - , RS.13,000/ - PAYING DIRECTLY TO THE U.T.I. AND RS.13,000/ - CASH AFTER I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 7 WITHDRAWN OF CASH FROM THE SAID BANK. IT IS PERTINENT TO POINT OUT HERE THAT MR. GHOSH HAD WITHDRAWN A SUM OF RS.1,90,000/ - FROM THE FIRM M/S. GHOSH &CO. SINCE THE ARBITRATION AWARD OF R S.7,31,500/ - HAS BEEN CONSIDERED IN THE HANDS OF M/S. GHOSH CONSTRUCTION ASSESSED BY THE LEARNED I.T.O.PURI IN THE ASSESSMENT YEAR 1987 - 88 VIDE GIR NO.334 G. AS SUCH THE ALLEGED ADDITION MADE ARE LIABLE TO BE DELETED. THE BANK STATEMENT OF ANDHRA BANK IS ALREADY SUBMITTED AT THE TIME OF ASSESSMENT AND AVAILABLE IN THE FILE. BEFORE THIS HONBLE FORUM THE MAIN ISSUE INVOLVED THAT THE LEARNED A.O. IN THE RELEVANT YEAR HAD NOT CONFRONTED THE ISSUE AND EXAMINED THE DETAILS FURNISHED TO HAVE AVAILABILITY OF SOUR CES FOR INVESTMENT EITHER IN THE CONSTRUCTION OF HOUSE PROPERTY OR PURCHASE OF NSC(S) AND UTI CERTIFICATES ETC. THEREFORE, SUCH ADDITION HAD NO BASIS AND HAS TO BE QUASHED AND DELETED. THE AMOUNTS WERE ROUTED IN THE INVESTMENT IN THE PROPERTY WERE FROM THE SOURCES WHICH WERE TAXABLE ENTITIES AND THEREFORE IT WAS A MATTER OF RECORD WITH THE DEPARTMENT TO HOLD THAT A LAND PURCHASED WAY BACK IN 1978 WAS USED FOR ERECTING A STRUCTURE SPREAD OVER A PERIOD OF TEN YEARS. THERE IS NO HARD AND FAST RULE THAT ON A PA RTICULAR DATE IT WOULD REQUIRE CONSIDERATION FOR ITS VALUATION TO BE SPREAD OVER A PERIOD OF YEARS TOGETHER IN A PROPORTION THE ASSESSING OFFICER DEEMS IT FIT AND ALSO THE ASSESSING OFFICER OUGHT TO HAVE CARRIED OUT THE VERIFICATION OF INCOME GENERATED FO R RESPECTIVE YEARS AS PER THE RECORDS AVAILABLE TO IT WHICH THE ASSESSEE HAS BEEN REPEATEDLY CLAIMING HAD SUFFERED TAX IN ACCORDANCE WITH THE PROVISIONS OF THE I.T.ACT. SECTION 69 OF THE IT ACT HAS BEEN INITIATED BASING ON PRESUMPTION WHICH HAS NO POSITIVE CHARACTER BUT IT HAS ONLY LAID EMPHASIS ON MAY GIVING DISCRETION TO THE A.O. TO APPRECIATE AND ACCEPT THE INVESTMENT UNLESS THE DEPARTMENT HAS EVIDENCED TO REVERT THE SAME. THEREFORE, THE ADDITIONS MADE WITHOUT EXAMINING THE DETAILS AND CONFRONTING THE ISSUES MADE I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 8 VIOLATION OF NATURAL JUSTICE AND ARBITRARILY SUCH ADDITIONS WERE MADE WHICH ARE TO BE QUASHED AND DELETED . 3. THE LEARNED DR SUPPORTED THE ORDERS OF THE AUTHORITIES BELOW. 4. WE HAVE CONSIDERED THE CASE OF THE ASSESSEE AND PERUSED THE MATERIA L AVAILABLE ON RECORD. WE FIND THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE APPROPRIATE THAT FOR THE ASSESSMENT YEAR 1982 - 83, 1985 - 86, 1986 - 87,1987 - 88 AND 1989 - 90 THERE WERE ADDITIONS IN THE CONSTRUCTION OF HOUSE PROPERTY UNDER SECTION 69 OF THE IT ACT AT RS.50,500/ - , RS.48,554/ - , RS.43,495/ - AND SIMILARLY FOR THE ASSESSMENT YEAR 1987 - 88 ADDITION OF RS.30,000/ - MADE AGAINST UNEXPLAIN ED INVESTMENT OF NSC AND RS.41,000/ - AGAINST UTI. REGARDING THE SOURCE OF INVESTMENT THE PETITIONER HAS SUBMITTED T HE INV ESTMENT OF RS.30,000/ - FOR THE A SSESSMENT YEA 1980 - 81 AND 1981 - 82 A ND ANOTHER RS.30,000/ - FOR THE A SSESSMENT YEAR 1984 - 85. OUT OF THE SOURCES, FROM EXECUTION OF C ONTRACT WORK CARRIED ON FROM THE ASSESSMENT YEAR 1969 - 70 ASSESSED TO INCOME TAX VIDE GIR NO.723(C). THE ASSESSEE WAS ALSO A PARTNER IN M/S.GHOSH CONSTRUCTION, M/S. NATIONAL CONSTRUCTION AND M/S. CHOSH & CO. CARRIED ON CONTRACT WORKS UNDER THE RAILWAY AND OTHER DIFFERENT ORGANIZATIONS. THE A SSESSEE HAD MADE DISCLOSURE UNDER THE VDIS SCHEME ALO NG WITH THE FAMILY MEMBERS AT 1 ,50,000/ - WHICH WAS SUBSEQUENTLY DRAWN AND INVESTED IN THE CONSTRUCTION OF HOUSE AND PURCHASE OF NSC. THE ASSESSEES BROTHERS WHO HAD FILED AGREEMENTS BEFORE THE CIT(A) STATING TO HAVE INVESTED RS.8 0,000/ - BY SRI RAM PRASAD GHOSH AND SRI SHAKTI PRASAD GH OSH OUT OF THEIR PAST SAVINGS WHO WERE ENGAGED IN THE BUSINESS AND SERVICE TAKEN UP. THE TOTAL INVESTMENT BY THE ASSESSEE MADE FROM VDIS ETC. VALUATION OF THE HOUSE WAS MADE BY THE REGISTERED VALUE AT RS.1,28,100/ - AND DEPARTMENTAL VALUER AT RS.2,02,000/ - AND THE ENTIRE I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 9 CONSTRUCTION OF THE HOUSE MADE FROM THE YEAR 1980 - 81 TO 1991 - 92 AND PURCHASE MEASURING AC.170 DECIMAL MADE ON 10.2.1978 AT RS.10,000/ - . THE BUILT UP AREA WAS ONLY 1.610 SQUARE FT. THE INVESTMENT IN THE NSC MADE AT RS.30,000/ - THE DETAILS OF THE INVESTMENT ARE SEPARATELY FURNISHED. SIMILARLY UTI RS.41,000/ - IN THE ASSESSMENT YEAR 1989 - 90 OUT OF THE FUNDS WITHDRAWN FROM ANDHRA BANK ON OCTOBER 1988 RS.15,000/ - AND RS.13,000/ - WAS WITHDRAWN FROM THE SAID BANK SO THE TOTAL INVESTMENT MADE RS.41,00 0/ - SHOULD HAVE BEEN ALLOWED ENTIRELY. HERE ALSO THE WIFE OF THE ASSESSEE INVESTED RS.7000/ - FROM HER SALA RY. IT WAS THE CASE OF THE ASSESSING OFFICER TO BRIG TO TAX THE AMOUNT OF COST OF CONSTRUCTION OF BUILDING AS ESTIMATED BY THE DVO AT 202,9800 WHICH HAD BEEN RENDERED TO TAX BY THE ASSESSEE ON THE COST AS CERTIFIED BY THE REGISTERED VALUER AT 1,28,100. IT WAS NOBODYS CASE THAT THE COST OF CONSTRUCTION TO BE SPREAD OVER FOR FOUR YEARS BEGINNING ASSESSMENT YEAR 1981 - 82, 1982 - 83, 1985 - 86 AND 1986 - 87. IN OTHER WORDS, THE ASSESSING OFFICER HAS NOT BEEN ABLE TO CORRELATE THE SPECIFIC FINDING OF THE DVO WHICH DO NOT FALL IN LINE WITH THE REGISTERED VALUERS COST OF CONSTRUCTION SPREAD OVER 10 YEARS. THE LEARNED COUNSEL FOR THE ASSESSEE HAS SU PPORTED HIS SUBMISSIONS ON THE BASIS OF GUIDELINES FOR VALUATION OF IMMOVABLE PROPERTIES ALONG WITH THE APPELLATE DECISION BY THE AUTHORITIES ON THE ISSUE WHETHER SECTION 69 COULD BE INVOKED FOR HOLDING THAT THE ASSESSEE HAS TO EXPLAIN WHICH EXPENDITURE IS ON ESTIMATION ONLY. IT WAS NOT THE CASE OF THE ASSESSEE TO EXPLAIN THE DIFFERENCE BETWEEN THE DVOS VALUATION VIS - A - VIS THE REGISTERED VALUERS VALUATION WHICH WAS IN ACCORDANCE WITH THE BOOKS OF ACCOUNT. THE FINDING OF THE LEARNED CIT(A) THEREFORE WAS RE SORTED TO BALANCE THE SOURCE OF INVESTMENT RETURNED BY THE ASSESSEE VIS - - VIS THE VALUE ADOPTED BY THE ASSESSING OFFICER ON THE ESTIMATED VALUATION SUBMITTED BY I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 10 THE DVO. THE LEARNED COUNSEL FOR THE ASSESSEE HAS BEEN ABLE TO EXPLAIN THAT THE COST OF CONSTRU CTION COULD NOT BE DISTURBED WHEN THE SOURCE OF INVESTMENT AS PER ACTUAL VALUATION DURING THE COURSE OF CONSTRUCTION PERIOD HAS BEEN THOROUGHLY EXPLAINED AND IS ACCEPTABLE TO THE ASSESSING AUTHORITIES. BY NO STRETCH OF IMAGINATION CAN THE DIFFERENCE IN EST IMATION BE REQUIRED BY THE ASSESSEE TO EXPLAIN WHEN THE ONUS IS ON THE AO TO FIND OUT THE DIFFERENCE BETWEEN THE TWO VALUATION REPORTS. IN OTHER WORDS, THE VERY SOURCE OF INVESTMENT AS RENDERED AS INVESTED HAS BEEN CHALLENGED BY THE ASSESSING AUTHORITIES A ND CONFIRMED BY THE LEARNED CIT(A), IN OUR CONSIDERED VIEW WAS UNJUSTIFIABLE. THEREFORE, INSOFAR AS THE ADDITION ON ACCOUNT OF DIFFERENCE IN VALUATION IS CONCERNED, WE ARE UNABLE TO SATISFY OURSELVES TO THE ADDITIONS MADE BY THE ASSESSING OFFICER DISCARDIN G THE VERY SOURCE ACCEPTABLE TO THEM WHICH ACCORDING TO THE ASSESSEE WAS THE ACTUAL COST OF CONSTRUCTION IN THE IMPUGNED ASSESSMENT YEAR. THE LEARNED DR OPPOSED THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE EXPLAINING THE SOURCE OF INVESTMENT IN N SC IN THE ASSESSMENT YEAR 1987 - 88 AND THE RESIDUAL AMOUNT INVESTED IN PURCHASE OF UTI BONDS IN THE ASSESSMENT YEAR 1989 - 90 WHICH WE HAVE PERUSED IN THE ORDERS OF THE AUTHORITIES BELOW AND FOUND THAT THE ASSESSEE REINVESTED IN THE NSC (NATIONAL SAVINGS CERT IFICATE) AMOUNTING TO 30,000/ - WHICH WAS INITIALLY PURCHASED IN NOVEMBER AND DECEMBER, 1980 AT RS.16,000/ - AND AFTER MATURITY IN THE YEAR 1986 - 87 THE AMOUNT AT RS.32,000/ - REINVESTED WHICH SHOULD HAVE BEEN CONSIDERED AND ACCEPTED . THE DETAILS OF THE AMOUNT MATURED AND REINVES TED HAVING BEEN EXPLAINED SHOULD HAVE BEEN CONSIDERED AND ACCEPTED. BUT THE LEARNED CIT (A) ONCE VERIFIED THE NUMBER AND DATE OF PURCHASES AND AMOUNT SHOULD NOT HAVE DISPUTED FURTHER HENCE THE ORDERS PASSED ARE LIABLE TO BE DELETED AND I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 11 QUASHED. IN RESPECT OF UTI BONDS, WE FIND THAT THE AMOUNT INVESTED AT RS.41,000/ - AGAINST PURCHASE OF UTI BONDS OUT OF WHICH RS.28,000/ - ACCEPTED BEING WITHDRAWN FROM ANDHRA BANK DURING OCTOBER 1988 RS.15,000/ - AND RS.13,000/ - DRAWN CASH FROM THE SAID BANK. BUT THE SUBSEQUEN T WITHDRAWAL OF MONEY AMOUNTING TO RS.93,000/ - OUT OF WHICH PURCHASE OF UTI BONDS AMOUNTING TO RS. 13,000/ - MADE SHOULD HAVE BEEN CONSIDERED AND ALLOWED . THEREFORE, THE ORDER PASSED ALLOWING PART AMOUNT OF RS.28,000/ - OUT OF RS.41,000/ - INVESTED CAUSED IL LEGALITY AND BALANCE AMOUNT OF RS.13,000/ - WAS TO BE ALLOWED . 5. IN THIS VIEW OF THE MATTER, WE DO NOT FIND ANY INFIRMITY IN THE SUBMISSIONS OF THE LEARNED COUNSEL FOR THE ASSESSEE AS ABOVE AND THEREFORE, ALLOW THE APPEALS OF THE ASSESSEE. 6. IN THE RESULT , ALL THE APPEALS OF THE ASSESSEE ARE ALLOWED. S D/ - S D/ - ( . . . ) , (K.S.S.PRASAD RAO), JUDICIAL MEMBER ( . . ) , , (K.K.GUPTA), ACCOUNTANT MEMBER. ( ) DATE: 14.08.2012 - COPY OF THE ORDER FORWARDED TO: 1 . / THE APPELLANT : SRI CHITTA PRASAD GHOSH, 269/1465, CUTTACK ROAD, BHUBANESWAR. 2 / THE RESP ONDENT: ASST.COMMISSIONER OF INCOME - TAX, CIRCLE 1(1), BHUBANESWAR 3 . / THE CIT, 4 . ( )/ THE CIT(A), 5 . / DR, CUTTACK BENCH 6 . GUARD FILE . / TRUE COPY, / BY ORDER, APPENDIX XVII ( ), (H.K.PADHEE), SENIOR.PRIVATE SECRETARY. I.T.A.NO. 1 14,115,116,117 AND 118/CTK/2012 12 SEAL TO BE AFFIXED ON THE ORDER SHEET BY THE SR. P.S./P.S. AFTER DICTATION IS GIVEN 1. DATE OF DICTATIO N 10.08.,2012 . 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 13.08.2012 OTHER MEMBER . 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4. DATE ON WHICH THE FAIR ORDER I S PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT.... 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S 14.08.2012 . 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 14.08.2012 7. DATE ON WHICH THE FILE G OES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER ................ 9. DATE OF DESPATCH OF THE ORDER ..