High Court Of Madras
CIT Vs. Smt. V. Gajalakshmi
Assessment Year : 2002-03
Section : 145, 69
F.M. Ibrahim Kalifulla And B. Rajendran, JJ.
T.C. (Appeal) No. 281 Of 2009
June 9, 2009
JUDGMENT
F.M. Ibrahim Kalifulla, J. – The above tax case appeal is filed by the Revenue under section 260A of the Income-tax Act, 1961 against the order of the Income-tax Appellate Tribunal, “C”, Bench, Chennai dated July 25, 2008 passed in I.T.A. No. 2324/Mds./2006.
2. The substantial question of law sought to be raised is as to whether in the facts and circumstances of the case, the Tribunal was right in sustaining the order of the Commissioner of Income-tax (Appeals), while examining the cost of constructions claimed by the assessee in respect of the properties situated at 132, Bells Road and 76, V.R. Pillai Street, Triplicane, Chennai and also on the ground that the assessee has failed to produce any evidence in support of her claim for the construction of the above said properties.
3. Having heard Mr. J. Naresh Kumar, learned standing counsel appearing for the appellant, we are not inclined to entertain this appeal as we do not find any question of law much less substantial question of law.
4. The value of construction made with reference to the abovementioned two properties, as claimed by the assessee, the assessee has shown the total cost of construction in respect of both the properties in a sum of Rs. 24.6 lakhs (Rs. 6.6 lakhs in respect of the property at 132, Bells Road and Rs. 18 lakhs in respect of the property at 76, V.R. Pillai Street, Triplicane, Chennai. The Assessing Authority in the order of assessment, however, took the view that the difference in cost of construction of both the properties would be Rs. 25,44,000 and assessed the income as Rs.35,99,050. The assessing authority also disallowed the receipt of certain gifts to the extent of Rs. 6,23,000 as well as advance receipts for letting out the property at 76, V.R. Pillai Street, Triplicane in a sum of Rs. 3,10,000.
5. As far as the receipt of advance of Rs. 10,65,000 as well as the gift of Rs.6,23,000 are concerned, the Commissioner (Appeals) while confirming the order of assessing authority insofar as it related to the receipt of gift of Rs. 6,23,000 held that the disallowance insofar as the advance amount will have to be restricted to a sum of Rs. 1,70,000. It is as against the order of the Commissioner (Appeals), the Revenue as well as the assessee went before the Tribunal in I.T.A. Nos. 2324 and 2121 of 2006 respectively. In the appeal preferred by the Revenue, the issue related to the question as to whether the valuation made by the Departmental Valuer is to be preferred as against the valuation made by the Assessing Officer based on the State PWD rates. The other question related to disallowance of advance receipts to the extent of Rs. 1,70,000 as against Rs. 3,10,000 as made by the assessing authority.
6. The Tribunal in its reasoned order has found that the adoption of the Assessing Officer, based on the State PWD rates at the rate of Rs. 3,079 per sq. mt. was justified and also held that the disallowance of advance receipts to an extent of Rs. 1,70,000 as held by the Commissioner (Appeals) was also in order. Having perused the order of the Tribunal, we find that the Tribunal has taken note of the fact that the Departmental Valuation Officer himself has accepted the position that the construction made by the assessee was between the assessment years 1996-97 and 2001-02 insofar as it related to the property at 132, Bells Road, and the ratio as ascertained by the Assessing Officer, viz., towards the value based on State PWD rates in the ratio of 5/6th and 1/6th for the assessment years 1997-98 to 2002-03 respectively was in order. Inasmuch as the Departmental Valuation Officer himself in his report has accepted the said factual matrix of the claim made by the assessee as regards the respective years of construction and the extent of construction made in the properties, we do not find any good reason to dislodge the finding of the Tribunal for the purpose of accepting the valuation, as made by the approved assessor whose report was submitted by the assessee which report was based on the State PWD rates which was in a sum of Rs. 3,079 per sq. mt. as against the sum of Rs. 5,802 per sq. mt. as reported by the Departmental Valuation Officer. It is relevant to note that the Departmental Valuation Officer though accepted the position that construction were made between 1997-98 to 2002-03, while estimating the cost of constructions, made the assessment based on the cost of construction for the assessment year 2002-03 for the entirety of the construction.
7. In such circumstances, we do not find any infirmity in the conclusion of the Tribunal in having accepted the valuation of the approved valuer in a sum of Rs. 3,079 per sq. mt. while passing order impugned in this appeal.
8. Similarly, in respect of receipt of disallowance of Rs. 1,70,000 here again we find that the Tribunal was satisfied that the materials placed before the Commissioner (Appeals) for receipt of advance amount to an extent excluding the sum of Rs. 1,70,000 and inasmuch as the said calculation was based on the relevant factors placed before the lower authorities, we are of the view that the same would not form part of any legal issue in order to entertain this appeal on any question of law much less substantial question of law.
9. In this context, it would be worthwhile to refer a decision of this Court in A. Abdul Rahim v. ITO [2002] 258 ITR 714/155 Taxman 33 wherein this Court held as under (headnote) :
“. . . the Tribunal had arrived at the cost of construction of the building on a reasonable basis and it could not be stated that the valuation of the building as a whole determined by the Tribunal was in any way arbitrary, unreasonable or perverse . . . “
10. Applying the above principle laid down by this Court and by relying on the same, we hold that we do not find any such arbitrary or unreasonable conclusion in the order of the Tribunal, while accepting the valuation of the approved valuer as against the valuation made by the Departmental Valuation Officer.
11. In view of the above conclusion, we do not find any scope to entertain this appeal. Therefore, the above tax case appeal stands dismissed.
[Citation : 331 ITR 216]
