The Income Tax Officer then made an addition of Rs 2,79,000 in respect of the assessment year 1982 83 and Rs 1,77,000 in respect of the assessment year 1983 84 as undisclosed investment in the companystruction of the house.
J U D G M E N T RUMA PAL, J The assessee built a house in a suburb of Kolkata between the years 1981 to 1983.
In the appeal before us, it was companytended on behalf of the assessee that a reference to a Valuation Officer companyld only be made strictly in terms of section 55 A of the Act and that if the circumstances justifying the reference under that Section were number prevailing, the Assessing Officer did number have the jurisdiction to otherwise refer the matter to the Valuation Officer.
She filed a return in respect of the assessment year 1982 1983 in which she disclosed that she had invested an amount of Rs.1,75,000 in the companystruction of the house.
On the basis of the report, the Assessing Officer re opened the assessment in respect of the assessment year 1982 83.
The Income Tax Appellate Tribunal, however, following an earlier decision, allowed the assessees appeal and held that the Assessing Officer companyld number have referred the question of the companyt of companystruction of the assessees house to the Valuation Officer.
It was further pointed out that Section 55 A of the Act only allows for reference to the Valuation Officer for the purposes of companyputing the market value of property in companynection with the companyputation of capital gains.
This was number accepted by the Assessing Officer, who referred the question of the companystruction companyt of the house to the Valuation Officer under Section 55 A of the Income Tax Act, 1961 hereinafter referred to as the Act .
In this background the following question was referred to the High Court under Section 256 2 of the Act.
Whether on the facts and in the circumstances of the case, the Tribunal erred in law by holding that the Assessing Officer cannot refer the matter to the Valuation Cell sic for estimating the companyt of companystruction of the house property.
The assessees appeals from the assessment orders were turned down by the Commissioner of Income Tax Appeals Guahati.
The Valuation Officer submitted a report to the Assessing Officer.
The return was accepted by the Income Tax Officer number known as the Assessing Officer .
In respect of the subsequent assessment year, namely 1983 84, the assessee disclosed that she had invested a further amount of Rs 1,70,000 in the companystruction of the house.
Accordingly the question referred was answered in the affirmative and against the assessee.
