In the present case, there was no basis for the AO to determine that the true value of the property was Rs. 1.25 crores, by adopting the return on capital method. The AO was under a duty first to ascertain what was according to him the true cost of the property. Not having done so, that error could not have been compounded by adopting a completely different methodology without any positive finding as to the cost of acquisition. The following conclusions of the CIT (A) extracted below, therefore, could not be faulted with:Online GST Certification Course by TaxGuru & MSME- Click here to Join
“On a consideration of the above facts and the legal position as emerging from the decisions relied upon by the appellant it is seen that the addition made for Rs. 74 lacs is purely based on estimate and conjecture and there is no substance in the estimate made by the AO, who in any case is not authorized to make any estimate under the provisions of section 142(2A) of the Income-tax Act. Moreover, section 69/69B are deeming provisions and it is trite law that deeming provisions are to be strictly interpreted. AS there is no invoke section 69/69B therefore for this reason too the addition made for Rs. 74 lacs is not sustainable in law. Accordingly, the Assessing Officer is directed to delete the addition made for Rs. 74 lacs on account of unaccounted investment made by the assessee out of undisclosed sources of income.”
For the forgoing reasons, this Court finds that there is no substantial question of law requiring determination in the present appeal. The same is consequently dismissed.