PRINCIPAL COMMISSIONER OF INCOME TAX-5 vs. HARESHBHAI RAVJIBHAI VASANI

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TAXAP/441/2018HC GujaratGJHC24024934201805 May 2018Bench: HONOURABLE MR. JUSTICE AKIL KURESHI,HONOURABLE MR. JUSTICE B.N. KARIA2 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the issue was purely factual in nature and no question of law arose from the Tribunal's order. The Tribunal had confirmed the deletion of additions made by the AO, which were based on the DVO's valuation report. The Tribunal's reasoning, upheld by the High Court, was that the DVO had relied on non-agricultural lands for valuing the subject agricultural land, and that the land in question was undeveloped, rendering the comparison inappropriate. The CIT(A)'s order, which was more elaborate, also noted the comparison of un-comparables. Therefore, the High Court found no merit in the Revenue's appeal.

What were the facts?

The Revenue is in appeal against an order of the Income Tax Appellate Tribunal (Tribunal) dated November 23, 2017. The appeal pertains to Assessment Year 2007-2008 for the respondent-assessee, Hareshbhai Ravjibhai Vasani. The Assessing Officer (AO) had made additions of Rs. 86,52,224 based on a valuation report obtained from the Department's Valuation Officer (DVO) under Section 142A of the Income Tax Act. Both the Commissioner of Income Tax (Appeals) [CIT(A)] and the Tribunal deleted these additions. The deletion was primarily based on the unreliability of the DVO's report. The CIT(A) noted that the DVO compared the subject agricultural land with non-agricultural lands in the region, and that the land in question was undeveloped, making the comparison inappropriate.

What were the issues?

1. Whether the Appellate Tribunal was right in law and on facts in deleting the addition of Rs. 86,52,224/= made by the Assessing Officer on the basis of the valuation report of the DVO referred under Section 142A of the Act? Assessee's Contention: The judgment does not record any specific contentions made by the assessee before the High Court. However, the reasoning of the Tribunal, which was upheld, indicates that the assessee likely argued that the DVO's report was unreliable because it compared the subject agricultural land with non-agricultural lands, and that the land was undeveloped, making the comparison inappropriate. Revenue's Contention: The Revenue's appeal is based on the question of law and fact as stated above, implying they contended that the Tribunal erred in deleting the addition made by the AO based on the DVO's report.

Which sections of the Income-tax Act were involved?

Section 142A

AI-generated summary — verify with the full judgment below

C/TAXAP/441/2018 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL No. 441 of 2018 ============================================================= PRINCIPAL COMMISSIONER OF INCOME TAX-5 Versus HARESHBHAI RAVJIBHAI VASANI ============================================================= Appearance : Mrs MAUNA M BHATT, Advocate for the PETITIONER for the RESPONDENT(s) No. 1 ============================================================= CORAM: HONOURABLE Mr. JUSTICE AKIL KURESHI and HONOURABLE Mr. JUSTICE B.N. KARIA 5th May 2018

ORAL ORDER (PER : HONOURABLE Mr. JUSTICE AKIL KURESHI) Revenue is in appeal against the judgment of the Income Tax Appellate Tribunal, Ahmedabad [“Tribunal” for short] dated 23rd November 2017, raising following question for our consideration : “Whether the Appellate Tribunal was right in law and on facts in deleting the addition of Rs. 86,52,224/= made by the Assessing Officer on the basis of valuation report of the DVO referred under Section 142A of the Act ?” Page 1 of 2

C/TAXAP/441/2018 ORDER Brief facts are that in the case of the respondent-assessee for AY 2007-2008, pursuant to search and submission of the report by the DVO, the AO made certain additions. CIT [A] and the Tribunal both deleted such additions primarily on the record that the report of DVO was not reliable. The Tribunal, while confirming the view of CIT [A] noted that for adopting the value of the land in question, the DVO had relied on non- agricultural lands of the region. Whereas, the land in question was an agricultural land. Except guess work, there was no concrete material on record. The order of CIT [A] being more elaborate. He noted that the land was undeveloped and the DVO had compared the un-comparables. Issue is purely factual in nature. No question of law arises. Tax Appeal is dismissed. [Akil Kureshi, J.] [B.N Karia, J.] Prakash Page 2 of 2

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