DR GURMEET SINGH Vs. ITO

JUDGEMENT

(1.) This is an appeal by assessee for assessment year 1989-90 directed against the order of Commissioner (Appeals), Jodhpur dated 24-1-1997.

(2.) I have heard the arguments of both the sides and also perused the records including the written statements of the learned authorised representative of assessee furnished on record before me.

(3.) The assessee-appellant has raised as many as four grounds of appeal but they all constitute single issue disputing the learned Commissioner (Appeals)'s impugned order in not cancelling the assessment order and not deleting the addition of Rs. 50,650 made by the assessing officer in the cost of construction on the basis of valuation report of AVO. The learned authorised representative of assessee has contended that the assessee has maintained regular books of accounts in respect of the cost of construction of clinic building for the assessment year under appeal and the said accounts are in details and are duly supported by vouchers. He has contended that he had produced the aforesaid accounts together with the copies of the vouchers before assessing officer also. He has contended that the assessing officer has not considered the accounts and supportive vouchers furnished by assessee and has neither rejected the accounts nor has he found any defects in the accounts of assessee but has straightaway made reference to AVO for estimating the valuation/cost of construction of assessee's clinic building. He has contended that the assessing officer has made the addition on the basis of AVO's valuation report estimating the cost of construction. He has contended that this action of assessing officer is contrary to law and against the judicial pronouncement of Honble, Jurisdictional High Court in the case of CIT v. Pratap Singh Amrao Singh, etc. and CIT v. Hotel Joshi 22 TW 807 (Raj). He has contended that even otherwise there are a number of defects in the AVO's valuation report to which the assessee has objection and the same were also duly raised before assessing officer vide assessee's letter dated 21-8-1990 (pages 6 to 9 of paper book) and dated 5-10-1990 (pages 4 to 5 paper book), which has also been referred to by assessing officer in his order on page 2 of his assessment order. He has contended that before the learned Commissioner (Appeals) also the assessee raised the above contentions but the learned Commissioner (Appeals) has not decided the assessee's above contentions on merits and has simply disposed off the appeal by observing that the assessee may file rectification petition before assessing officer and if not satisfied by order rendered by assessing officer on assessee's rectification petition, the assessee may file appeal thereagainst or may take steps for revival of appeal before Commissioner (Appeals). He has contended that the learned Commissioner (Appeals) ought to have decided the appeal on merits and should have deleted the addition of Rs. 50,650 made by assessing officer in the cost of construction inasmuch as the addition made by assessing officer was uncalled for and not justified for the reason that the assessee had maintained regular and detailed accounts which were duly supported by vouchers. He has contended that the Honble Jurisdictional High Court has laid down the legal position, in the above mentioned cases, to the effect that when the assessee has maintained regular accounts of the cost of construction, which are supported by vouchers/evidence, and the assessing officer does not find defect therein, the action of the assessing officer in making reference to DVO/AVO for valuation of construction/building is not justified, nor is the action of assessing officer in making addition on the basis of such estimate made in the valuation report of DVO/AVO. He has contended that it has also been held by the Honble Jurisdictional High Court as also by various decisions of Tribunal that the cost of construction should be determined on the basis of local PWD rates and not on the basis of CPWD rates. He has contended that in the instant case the AVO has made valuation of the cost of construction/building in his valuation report on the basis of CPWD rates and not on the basis of State/PWD rates. He has also contended that the AVO has also not given any credit/benefit for self supervision and has also considered the expenditure on account of architect/engineer though the assessee had not availed the services of any such persons. He has accordingly contended that the AVO's action in making reference for valuation to AVO is legally not valid, and in turn, the addition made by assessing officer in the cost of construction is also legally not justified and so the addition should be deleted.