ACIT, Ludhiana V. M/s Kanya Enterprises (P) Ltd., Ludhiana

ITA 1281/CHANDI/2010

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86200 (ITAT-CHANDIGARH)
• Duration Of Justice: 4 year(s) 4 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-02-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 11-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Keywords: Depreciation; Fair market value; Valuation report

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL CHANDIGARH BENCH B CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 1281/CHD/2010 ASSESSMENT YEAR: 2006-07 THE ACIT, V M/S KANYA ENTERPRISES (P) LTD. CIRCLE II, SAMRALA CHOWK, LUDHIANA. LUDHIANA. PAN: AACCS4795B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANJIT SINGH RESPONDENT BY : SHRI SUDHIR SEHGAL DATE OF HEARING : 02.02.2015 DATE OF PRONOUNCEMENT : 13.03.2015 O R D E R PER T.R.SOOD, ACCOUNTANT MEMBER IN THIS APPEAL, REVENUE HAS RAISED THE FOLLOWING G ROUNDS : 1. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN . HOLDING THAT THE AO HAD WRONGLY APPLIED THE CIRCLE RA TE OF COMMERCIAL LAND WITHOUT EVIDENCE IN VALUING THE VALUE OF LAND AT RS. 20,82,712/-AND THAT THE CIRCLE RATE FOR AGRICUL TURE LAND WAS TO BE TAKEN, IGNORING THE FACT THAT THE LAND WAS BE ING USED FOR COMMERCIAL PURPOSES AND THAT CIRCLE RATE OF RS. 9 00/- PER SQ.YD. WHICH IS APPLICABLE TO COMMERCIAL BUILDING WAS TO BE TAKEN FOR VALUATION OF LAND. 2. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS I N HOLDING THAT WHEN THE VALUE OF LAND AND BUILDING HAS B EEN REGISTERED BY THE REGISTRAR AT RS. 25,00,000/- IN T HE MONTH OF SEPT., 2008 THE VALUE OF LAND CANNOT BE TAKEN AT RS. 2 0,82,712/- IN THE MONTH OF APRIL, 2005 IGNORING THE FACT THAT T HE AO HAS CLEARLY BROUGHT OUT THAT IN THE REGISTRATION DEED T HERE IS NO MENTION OF BUILDING ON THE LAND. 3. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE VALUE OF LAND TAKEN AT RS. 30,00,0 00/- BY 2 AO IS HIGHLY EXCESSIVE WITHOUT GIVING ANY REASONS FOR THE SAME. 4. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE VALUATION REPORT DATED 14.12.2005 SUBMITTED TO THE BANK WAS ONLY FOR THE PURPOSES OF THE BANK AN D THAT VALUE WAS INFLATED, IGNORING THE FACT THAT IN BOTH V ALUATION REPORTS DATED 14.12.2005 AND 30.12.2008, SUBMITTED BY SAME VALUER, HE HAD ARRIVED AT THE VALUE OF BUILDING BY ADOPTING THE RATES AS PER PUNJAB PWD COMMON SCHEDULE AND HENCE VALUATION REPORT DATED 14.12.2005 WAS TO BE R ELIED UPON BY THE AO. 5. THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN HOLDING THAT THE VALUE OF MACHINERY SHOULD BE ADOPTED A T RS. 55 LAKH AS AGAINST RS. 66 LAKH ADOPTED BY THE AO WITHO UT GIVING ANY REASONS. 2. AFTER HEARING BOTH THE PARTIES, WE FIND THAT DURING ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTICE D THAT THERE WAS A FIRM KNOWN AS M/S BALAJI SPINNING MILLS AND THE FIRM WAS DISSOLVED ON 31.03.2005. THE BUSINESS WAS TAKEN OVER BY THE ASSESSEE COMPANY ON 01.04.2005. ACCORD ING TO THE ASSESSING OFFICER, SINCE THE PARTNERS OF THE FIRM A RE DIFFERENT FROM THE SHAREHOLDERS OF THE NEWLY INCORPORATED COM PANY, THEREFORE, TRANSFER OF ASSETS BY THE FIRM TO THE NE W COMPANY WAS TO BE CONSTRUED AS TRANSFER OF ASSET AS PER SEC TION 47(VIII). THIS FINDING HAS BEEN CONFIRMED BY THE LD. CIT(APP EALS) ALSO AGAINST THE ASSESSEE AND SINCE ASSESSEE HAS NOT FIL ED ANY APPEAL OR CROSS-OBJECTION, THEREFORE, WE ARE NOT DE ALING WITH THIS ISSUE IN DETAIL. 3. IT WAS FURTHER NOTICED THAT LAND, BUILDING AND MACH INERY WERE TRANSFERRED AT THE BOOK VALUE AND NOT AT THE M ARKET VALUE. ASSESSEE HAS ITSELF SHOWN THE MARKET VALUE WHIC H BECOMES 3 CLEAR FROM THE FOLLOWING CHART : BOOK VALUE AS APPRECIATION APPRECIATED VALUE ON 01.04.2005 AS ON 31.03.07 -------------------- ------------------ --- ------------------------- I) LAND RS. 5,80,480/- RS. 28,90,520/- RS. 34,70,480/- II) BUILDING RS.11,79,520/- RS. 62,74,480/- RS. 74,54,000/- III)MACHINERY RS.44,93,873/- RS. 91,91,676/- RS.1,32,19,550/- 4. IT WAS FURTHER NOTICED THAT LAND WAS REGISTERED IN THE NAME OF THE COMPANY ON 26.09.2008 AT A COST OF RS. 25,00,000/- BUT THE SALE DEED DID NOT MENTION THAT THERE WAS A BUILDING ALSO. THEREFORE, THE FACTS THAT THERE WAS A BUILDING EXISTING ON SUCH LAND WAS CONCEALED. FURTHER THE L AND WAS REGISTERED AT THE CIRCLE RATE FIXED BY THE STATE RE VENUE DEPARTMENT FOR AGRICULTURAL LAND WHEREAS THE LAND O F THE ASSESSEE COULD NOT BE CALLED AGRICULTURAL LAND AND IT WAS A COMMERCIAL LAND SITUATED ON THE MAIN ROAD TO V-LAKH EWAL. IT WAS FURTHER NOTICED THAT VALUE OF THE ASSETS WAS SH OWN AT A MUCH HIGHER VALUE TO THE BANK. THEREFORE, ASSESSEE WAS ASKED TO JUSTIFY THE VALUATION ON THE TRANSFER OF THE ASS ETS. IN REPLY, IT WAS MAINLY STATED THAT VALUATION WAS SUBMITTED T O THE BANK ON HIGHER RATES TO SHOW HIGHER NET WORTH OF THE COM PANY FOR OBTAINING BANK LIMITS AND THEREFORE, THE REPORT SUB MITTED TO THE BANKERS COULD NOT BE RELIED. FURTHER, THERE WAS LO T OF INCREASE IN THE VALUE OF THESE ASSETS IN ASSESSMENT YEAR 200 7-08 WHEREAS THE TRANSFER RELATED TO ASSESSMENT YEAR 200 6-07. IT WAS POINTED OUT THAT MERELY SHOWING HIGHER VALUE TO THE BANKERS WOULD NOT MAKE THE ACTUAL VALUE HIGHER AND IN THIS REGARD, RELIANCE WAS PLACED ON THE DECISION OF HON' BLE PUNJAB & 4 HARYANA HIGH COURT IN THE CASE OF CIT VS SIDHU RICE & GENERAL MILLS 281 ITR 428. 5. THE ASSESSEE ALSO FURNISHED VALUATION REPORT ON THE BASIS OF THE CIRCLE RATE BY THE SAME VALUER AND IT WAS PO INTED OUT THAT ACCORDING TO THIS METHOD, THE VALUATION COMES TO RS . 41,33,766/- ON 30.12.2008 WHICH WAS MUCH LESS THAN THE EARLIER VALUATION REPORT. VALUATION REPORT FOR THE MACHINERY WAS ALSO FILED. 6. THE ASSESSING OFFICER, AFTER CONSIDERING THE SUB MISSIONS OBSERVED THAT DIFFERENT ASSETS WERE VALUED AT VARIO US POINTS OF TIME AS UNDER : 7. FROM THE ABOVE, HE CONCLUDED THAT REGISTERED VAL UER REDUCED THE VALUE TO MUCH LOWER FIGURE IN THE REPOR T FILED WITH THE DEPARTMENT AND THEREFORE, ACCORDING TO THE ASSE SSING OFFICER, SAME COULD NOT BE RELIED. THE ASSESSING O FFICER ADOPTED THE VALUE OF LAND AT RS. 20,82,712/-, VALUE OF BUILDING AT RS. 30,00,000/-, VALUE OF MACHINERY AT RS. 66,00 ,602/- AND THE TOTAL VALUE OF THE ASSETS, ACCORDING TO HIM WAS RS.1,16,83,314/-. SINCE ASSESSEE HAS SHOWN THE VA LUE FOR THE PURPOSE OF TRANSFER AT RS. 53,89,833/-, THE BALANCE SUM OF ASSETS BOOK VALUE AT VALUE AS PER VALUATION VALUE AS PER WHICH THE ASSETS REPORTS SUBMITTED TO THE VALUATION REPORT ARE TRANSFERRED ON BANK AND TAKEN IN THE NOW FILED BEFORE 01.04.05 BALANCE SHEET AS ON INCOME TAX 31.03.07 DEPARTMENT. LAND 5,08,480/- 34,70,480/- 9,56,250/- BUILDING 10,61,560/- 7336,048/- 31,77,516/- MACHINERY 38,19,793/- 1,30,1 1,469/- 58,50,000/- 5 RS. 62,93,481/- WAS HELD TO BE AMOUNT PAID OUTSIDE THE BOOKS OF ACCOUNT AND WAS ADDED TO THE INCOME OF THE ASSES SEE. 8. ON APPEAL BEFORE LD. CIT(APPEALS), IT WAS MAI NLY SUBMITTED THAT ASSESSING OFFICER HAS REFERRED TO THE VALUATIO N REPORT GIVEN TO THE BANK BUT HE HAS IGNORED THE FACTS THAT SUCH REPORT WAS GIVEN IN ASSESSMENT YEAR 2007-08 WHEREAS TRANSFER T OOK PLACE IN ASSESSMENT YEAR 2006-07. FURTHER, IT WAS STATED THAT SINCE ASSESSEE WANTED HIGHER LIMITS FROM THE BANK, THEREF ORE, NET WORTH WAS SHOWN ON HIGHER SIDE. IT WAS SUBMITTED T HAT SUCH VALUATION GIVEN TO THE BANK COULD NOT CONSTITUTE TH E REAL VALUE OF THE ASSET FOR THE PURPOSE OF TRANSFER OF THE ASS ETS. THE LD. CIT(APPEALS), AFTER EXAMINING THE SUBMISSIONS FOUND FORCE IN THE SAME AND DELETED THE ADDITION. 9. BEFORE US, LD. DR STRONGLY SUPPORTED THE ORDER O F ASSESSING OFFICER AND CARRIED US THROUGH VARIOUS OB SERVATIONS MADE BY THE ASSESSING OFFICER AND POINTED OUT THAT VALUATION OF THE ASSETS I.E. LAND, BUILDING AND MACHINERY WAS VA LUED AT A HIGHER RATE FOR THE BANK, THEN THE SAME VALUE SHOUL D HAVE BEEN ADOPTED FOR THE PURPOSE OF TRANSFERRING THE ASSETS TO THE COMPANY. IN ANY CASE, ASSESSEE ITSELF RECORDED APP RECIATION IN THE NEXT YEAR BY CREATING APPRECIATION RESERVE. HE FURTHER RELIED ON THE DECISION OF HON'BLE PUNJAB & HARYANA HIGH COURT IN CASE OF B.T. STEELS LTD. VS CIT 328 ITR 471. 10. ON THE OTHER HAND, LD. DR STRONGLY SUPPORTED TH E IMPUGNED ORDER. HE FURTHER SUBMITTED THAT ASSESSIN G OFFICER HAS ARRIVED AT VARIOUS VALUATIONS MERELY ON THE BAS IS OF HIS OPINIONS WITHOUT BRINGING ANY MATERIAL ON RECORD TO SHOW THAT 6 HIGHER CONSIDERATION WAS PAID. HE POINTED OUT THAT DECISION IN CASE OF B.T. STEELS (SUPRA) IS NOT APPLICABLE BECAU SE IN THAT CASE, BANK AUTHORITIES HAVE VERIFIED THE STOCK AS S HOWN IN THE STATEMENT GIVEN TO THE BANK AND SAME WAS FOUND TO B E CORRECT WHEREAS IN THE PRESENT CASE, BANKERS HAVE NOT VERIF IED THE VALUATION. HE STRONGLY RELIED ON THE FOLLOWING DEC ISIONS : 1. CIT VS SIDHU RICE & GENERAL MILLS 281 ITR 428(P& H) 2. CIT VS SMT. RAJ KUMARI VIMLA DEVI 279 ITR 360 ( ALL) 3. ORDER OF ITAT CHANDIGARH BENCH IN ITA NO. 526/CHD/2009 IN THE CASE OF ITO, JAGRAON VS M/S NEW P. GRAND RESORTS, JAGRAON 4. ORDER OF ITAT CHANDIGARH BENCH IN ITA NO. 866/CHD/2007 IN THE CASE OF ACIT, LUDHIANA VS SHRI RUPESH KAUSHAL 11. HE POINTED OUT THAT IN CASE OF CIT VS RUPESH KA USHAL (SUPRA), HON'BLE PUNJAB & HARYANA HIGH COURT HAS CO NFIRMED THE ORDER OF TRIBUNAL BY REFERRING TO THE DECISION OF HON'BLE SUPREME COURT IN CASE OF K.P.VERGESE VS ITO 131 ITR 597. IN THE PRESENT CASE ALSO, THERE IS NO EVIDENCE WITH TH E DEPARTMENT THAT HIGHER CONSIDERATION HAS BEEN PAID. THEREFORE , LD. CIT(APPEALS) HAS CORRECTLY DELETED THE ADDITION. 12. WE HAVE CONSIDERED RIVAL SUBMISSIONS CAREFULLY. THE LD. CIT(APPEALS) HAS ADJUDICATED THIS ISSUE VIDE PARAS 4.11 TO 4.16, WHICH ARE AS UNDER : 4.11. REGARDING VALUE OF ASSETS IT IS SEEN FROM T HE ASSESSMENT ORDER THAT THE AO HAS ADOPTED THE VALUE OF LAND AT RS. 20,82,712/- ADOPTING THE CIRCLE RATE OF RS.900/- PER SQ. YD. WHICH IS APPLICABLE TO COMMERCIAL LAND IN VILLAGE LAKHEWAL WHERE THE FACTORY BUILDING IS SITUATED. IN THIS REGARD THE AR HAS SUBMITTED THAT AF ORESAID VALUE 7 ADOPTED BY THE ASSESSING OFFICER IS ERRONEOUS IN AS MUCH AS LAND IN QUESTION IS AGRICULTURAL AND NOT COMMERCIAL. AR HAS DRAWN MY ATTENTION TO PAGE 53 OF THE PAPER BOOK WHICH IS A PURCHASE DE ED DATED 17.12.2002 OF THE AFORESAID FACTORY COMPRISING LAND AND BUILDING FOR RS. 17,60,000/- ON WHICH STAMP DUTY OF RS. 1,05 ,600/- IS STATED TO HAVE BEEN PAID @ 6%. THE AR HAS STATED THAT 6% S TAMP DUTY IS APPLICABLE TO AGRICULTURAL LAND AND NOT TO THE COMMERC IAL LAND. ACCORDING TO THE AR CIRCLE RATE OF AGRICULTURAL LAND IN TH E AFORESAID AREA WAS RS. 12 LACS PER ACRE WHICH COMES TO RS. 244/- ON THE BASIS OF WHICH THE VALUE OF LAND COMES TO RS. 5,64,616/- WHICH I S LESS THAN BOOK VALUE AS ON 01.04.2005. IN VIEW OF THE ABOVE, I AM OF THE OPINION THAT THE ASSESSING OFFICER HAS WRONGLY APPLI ED THE CIRCLE RATE OF COMMERCIAL LAND WITHOUT ANY EVIDENCE AND APPEARS T O HAVE IGNORED THE PURCHASE DEED DATED 17.12.2002. IN FACT AFORESA ID PROPERTY HAS BEEN TRANSFERRED TO THE ABOVE COMPANY IN THE MO NTH OF SEPTEMBER 2008 AT RS. 25 LACS INCLUDING STAMP DUTY WHICH ACCORD ING TO THE AR INCLUDES LAND AND BUILDING. WHEN THE VALUE OF LAND A ND BUILDING HAS BEEN REGISTERED BY THE REGISTRAR AT RS. 25 LACS IN THE MONTH OF SEPTEMBER 2008, I FIND FORCE IN AR'S CONTENTION THAT THE VALUE OF THE LAND CANNOT BE TAKEN AT RS. 20,82,712/- IN THE MONTH OF APRIL 2005. 4.12 AS REGARDS BUILDING, THE ASSESSING OFFICER HAS ADOPTED THE VALUE OF BUILDING AT RS. 30 LACS AS AGAINST RS. 11,79,52 0/- BOOK VALUE SHOWN BY THE APPELLANT. ASSESSING OFFICER HAS ADOPTED THE ABOVE VALUE AT RS. 30 LACS LOOKING TO THE TWO REPORT S OF THE REGISTER VALUER. HERE ALSO APPELLANT HAS STATED THAT LAND AND BUILDING WAS PURCHASED TOGETHER BY THE SALE DEED DATED 17.12.200 2 FOR RS. 17,60,000/- AND THE SAME HAS BEEN TRANSFERRED TOGETH ER TO THE COMPANY ON THE VALUE OF RS. 25,00,200/- IN THE MONTH OF SEPTEMBER, 2008. THEREFORE, THE VALUE OF THE BUILDING CANNOT B E TAKEN AT RS. 30 LACS IN THE MONTH OF APRIL, 2005 WHICH HAS BEEN ADOP TED BY THE ASSESSING OFFICER. 4.13 AR HAS STATED THAT THE VALUER HAS VALUED THE BUILDING AT RS. 1,77,516/- AS ON 30.12.2008 WHICH INCLUDES ADDI TION OF RS. 24,68,276/- BETWEEN THE PERIOD FROM 1.4.2007 TO 27.12 .2008. IF THE SAME IS REDUCED FROM THE VALUATION OF RS. 31,77,516/- ADOP TED BY THE APPROVED 8 VALUER ON 30.12.2008, THE VALUE OF THE BUILDING IN THE MONTH OF APRIL 2005 REMAINS 7,09,240/- WHICH IS LESS THAN W.D.V. 4.14 TAKING INTO CONSIDERATION THE ENTIRETY OF THE FACTS DISCUSSED ABOVE, I AM OF THE OPINION THAT VALUE OF THE BUILDING AT RS . 30 LACS ADOPTED BY THE ASSESSING OFFICER, IS HIGHLY EXCESSIVE WITHO UT ANY SUBSTANCE. IN FACT THE BUILDING WAS CONSTRUCTED LONG AGO AND HAS DEPRECIATED OVER THE YEARS. REGARDING THE VALUATION MADE BY THE VALUER SH OWING HIGH VALUE OF LAND BUILDING AND MACHINERY SAME IS FOR THE PURPOSE S OF BANK WHICH HAS BEEN CERTIFIED BY THE VALUER. THEREFORE, NO REL IANCE CAN BE PLACED ON THE SAME IN VIEW OF THE VARIOUS DECISIONS RELIED UP ON BY THE AR IN HIS SUBMISSIONS. 4.15 REGARDING VALUATION OF MACHINERY, SAME HAS BEE N ADOPTED BY THE ASSESSING OFFICER AT RS. 66,00,602/- BY REDUCIN G THE DEPREDATION @ 10% FROM THE VALUE OF MACHINERY OF RS. 90,54,324/- I N THE YEAR 2002. THE VALUER HAS VALUED THE MACHINERY AT RS. 1,30,11,469/ - AS ON 31.3.2007 FOR THE PURPOSE OF BANK WHICH IN MY OPINION CANNOT FORM VALID BASIS FOR MAKING ADDITION, FOR THE REASONS DISCUSSED ABOVE. I N FACT IN THE SECOND VALUATION'S REPORT, VALUER HAS VALUED THE MACHINERY AT RS. 58,50,000/- ON THE BASIS OF RATES OF OLD MACHINERY AS ON 30.12. 2008 AS NOTED BY THE ASSESSING OFFICER AT PAGE 10 OF THE ASSESSMENT ORDE R. IN THIS REGARD AR HAS REFERRED TO THE APPROVED VALUER'S REPORT DATED 30.12.2008 IN WHICH HE HAS VALUED THE TOTAL MACHINERY AT RS. 1,73,50,00 0/- WHICH INCLUDES MACHINERIES PURCHASE FOR RS. 76,00,000/- IN THE YEA R 2006. AFTER EXCLUDING RS. 76,00,000/- THE VALUE OF THE MACHINER IES PURCHASE IN THE YEAR 2006 I.E. AFTER THE COMPANY SUCCEEDED THE FIRM I N APRIL 2005 VALUE OF THE OLD MACHINERY SHOWN COMES TO RS. 97,50 ,000/- AS ON 30.12.2008. AR HAS SUBMITTED THAT BY REDUCING DEPRECIATI ON @ 25% FOR THREE YEARS THE FAIR MARKET VALUE OF THE MACHIN ERY COMES TO RS. 41,13,281/- AS ON 1.4.2005 WHICH IS LESS THAN W.D.V. OF RS. 44,93,874/-. HOWEVER, THIS CONTENTION OF THE AR IS NOT FULLY ACCEPTABLE. 4.16 NO REALISTIC MEASURE HAS BEEN MADE EITHE R BY THE ASSESSING OFFICER/APPELLANT TO ARRIVE AT THE FAIR MAR KET VALUE OF THE MACHINERY AS ON 1.4.2005. WHILE THE ASSESSING OFFICE R HAS ADOPTED DEPRECIATION @ 10%, APPELLANT HAS ADOPTED DEPRECIATI ON @ 25% TO 9 ARRIVE AT THE VALUE OF MACHINERY AS ON 1.4.2005. TAKI NG INTO ACCOUNT THE ENTIRETY OF THE FACTS, I AM OF THE OPINION THAT IT WOULD BE REASONABLE IF THE VALUE OF MACHINERY IS ADOPTED AT RS. 55 LACS. ACCORDINGLY ASSESSING OFFICER IS DIRECTED TO COMPUTE THE EXCESS AMOUNT PAID BY THE APPELLANT COMPANY ON THE BASIS O F ABOVE VALUATION OF MACHINERY. 13. IN OUR OPINION, LD. CIT(APPEALS) HAS CORRECTLY DECIDED THE ISSUE BECAUSE HE HAS CORRECTLY NOTED THAT 6% STAMP DUTY WAS APPLICABLE TO AGRICULTURAL LAND AND COMMERCIAL LAND AND HE HAS ALSO NOTED THE FACTS THAT CIRCLE RATE WAS RS. 12 LA CS PER ACRE WHICH WOULD COME TO RS. 244/- PER SQ.YD. AND THEREF ORE, VALUE OF THE LAND WOULD HAVE BEEN RS. 5,64,616/- WHICH IS LESS THAN THE BOOK VALUE WHEREAS LAND AND BUILDING HAS BEEN T RANSFERRED AT A CONSIDERATION OF RS. 25 LACS IN SEPTEMBER,2008 . THE LD. CIT(APPEALS) HAS GIVEN LOGIC WHY THE VALUATION ADOP TED BY ASSESSING OFFICER FOR VALUING THE BUILDING AT RS. 3 0 LACS IS NOT CORRECT BECAUSE BUILDINGS WOULD GENERALLY DEPRECIAT E OVER A PERIOD OF TIME. HE HAS ALSO RIGHTLY OBSERVED THAT IF DEPRECIATION @ 25% WAS GRANTED, THEN THE VALUE OF MACHINERY WOUL D BE RS. 41,13,281/- WHICH IS LESS THAN THE VALUE FOR WHICH MACHINERY HAS BEEN TRANSFERRED. FURTHER PERUSAL OF THE ASSES SMENT ORDER CLEARLY SHOWS THAT ASSESSING OFFICER HAS SUBSTITUTE D HIS VALUATION WITHOUT REFERRING THE MATTER TO VALUATION OFFICER OR BRINGING ANY MATERIAL ON RECORD TO SHOW THAT ASSESS EE HAS RECEIVED ANY CONSIDERATION IN EXCESS OF THE AMOUNT SHOWN IN THE SALE DEED WHICH IS NOT PERMISSIBLE UND ER THE LAW. 10 THEREFORE, WE FIND NOTHING WRONG WITH THE ORDER OF LD. CIT(APPEALS) AND CONFIRM THE SAME. 14. IN THE RESULT, APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13 TH MARCH,2015. SD/- SD/- (BHAVNESH SAINI) (T.R. SOOD) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 13 TH MARCH,2015. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT CHANDIGARH