Commissioner of Income Tax vs Sheikhar Chand and Sons

We are not satisfied that any question of law arises in this case which should be directed to be stated by the Tribunal u/s 256(2) of the Income Tax Act, 1961.

The question was whether there was any unexplained investment by the assessee in constructing a building complex. In that connection a question arose as to the cost of construction. The assessee filed two reports of two valuers in support of his contention. The Income Tax Officer called for a report from the Government valuer. There was a marked divergence between both the sets of valuation reports. The Tribunal preferred to accept the valuation reports filed on behalf of the assessee and, accordingly, held that there was no unexplained investment in the said construction. This is purely a finding of fact. However, learned standing counsel for the Revenue brings to our notice a particular observation made by the Income Tax Tribunal in para 11 of his judgment to the following effect:

"Therefore, when there is a registered valuer''s report, the Valuation Officer''s job is not merely to report the value as assessed by him but also to clarify where the registered valuer has erred. We have already stated that in this case the registered valuer''s report had been made available to the Valuation Officer and yet he chose not to comment on its accuracy. We, therefore, find no justification for the plea that the case should be sent back to the Inspecting Assistant Commissioner (Assessment) for examination of the accounts. If he chose not to do so he must have his own reason for the same and a second innings would be thoroughly unjustified."

We agree with learned standing counsel that this part of the reasoning of the Tribunal may not be strictly correct in law, but the said observation, in our opinion, has not vitiated the finding of the Tribunal which has been arrived at independently on the basis of the material on record.

The petition is, accordingly, dismissed. No costs.