Commissioner Of Income Tax v. Abhinav Kumar Mittal

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 ABHINAV KUMAR MITTAL... RespondentAdvocates who appeared in this case:For the Appellant: Mr Sanjeev RajpalFor the Respondent: None CORAM:-HON’BLE MR JUSTICE BADAR DURREZ AHMEDHON’BLE MR JUSTICE R.V.EASWAR JUDGMENT BADAR DURREZ AHMED, J (ORAL) 1.This appeal has been filed by the revenue against the order dated29.06.2012 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 returndeclaring an income of ` 39,90,410/- on 18.07.2006.Subsequently, asearch was conducted under Section 132 of the Income Tax Act, 1961 (hereinafter referred to as ‘the said Act’) on 26.04.2007 as also a surveyoperation under Section 133A in the premises of A. K. Capital ServicesLimited and its group companies as also in the premises of the Directorsof those companies and their relatives. Thereafter, a notice under Section153C 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 alreadyfiled on 18.07.2006 was requested to be treated as the return in responseto the said notice under Section 153C. 3.TheAssessingOfficer,inthecourseoftheassessmentproceedings, considered the valuation of three properties which had beenpurchased by the assessee in the relevant year.The three propertiesincluded two office premises at Ahmedabad and one commercial propertyat Kolkata.The Assessing Officer referred the question of valuation ofthe said properties to the District Valuation Officer (DVO). The DVOsubmitted his report on 14.12.2009 in respect of the Ahmedabadproperties and on 24.12.2009 in respect on the Kolkata property. As perthe said report, the DVO has valued the said properties as under:- 4.The difference in the values, as declared by the assessee and asopined by the DVO, amounted to ` 50,21,900/- in respect of theproperties at Ahmedabad and an amount of ` 9,57,038/- was thedifference in respect of the Kolkata property. These additions were madeby the Assessing Officer under Section 69 of the said Act. 5.Being aggrieved by the said additions, the assessee preferred anappeal before the Commissioner of Income Tax (Appeals), who deletedthe additions.The Income Tax Appellate Tribunal confirmed the saiddeletion. The issue that is sought to be raised here is that the deletion was not in accordance with law.However, we find that the Income TaxAppellate Tribunal as well as the Commissioner of Income Tax (Appeals)had concluded, on facts, that there was no material found during thesearch to justify the reference to the DVO for his valuation of the saidproperties. The Tribunal held that there must be some material to showthat the investment made by the assessee was outside the books. This,according to the Tribunal, was a condition precedent for making areference to the DVO.The Tribunal also held that, in any event, theDVO’s report was based on incomparable sales and, therefore, could notbe relied upon.The Tribunal also held that the burden was on therevenue to show that the real investment in the said properties was greaterthan the apparent investment, as disclosed by the respondent/ assessee.The Tribunal held, on facts, that the said burden had not been dischargedby the revenue. Consequently, the Tribunal held in favour of the assesseeand against the revenue and found that the reference to the DVO itselfwas 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 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 operations, which would justify the Assessing Officer’s action inreferring the matter to the DVO for his opinion on valuation of the saidproperties. If that be the case, then the valuation arrived at by the DVOwould be of no consequence.In any event, the Tribunal has also, onfacts, 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 JANUARY 23, 2013SR R.V.EASWAR, J