ACIT Vs Adish Estates Pvt. Ltd. (ITAT Delhi)
The Income Tax Appellate Tribunal (ITAT), Delhi Bench, has affirmed that a reference to the District Valuation Officer (DVO) for estimating the fair market value of property can only be made when income tax assessment or reassessment proceedings are already pending. This ruling came in the appeal filed by the Assistant Commissioner of Income Tax (ACIT) against Adish Estates Pvt. Ltd. for Assessment Year 2011-12. The ITAT upheld the decision of the Commissioner of Income Tax (Appeals) [CIT(A)] to delete an addition of Rs. 2,28,41,677/- made by the Assessing Officer (AO).
The case stemmed from a search conducted under Section 132 of the Income Tax Act, 1961, on the Aerens Group. The AO received information from the Investigation Wing indicating that Adish Estates Pvt. Ltd. had transacted in immovable property. To ascertain the fair market value of this property, the AO, invoking powers under Section 142A of the Act, made a reference to the DVO on March 5, 2015. Subsequently, a notice under Section 148 of the Act, for reassessment, was issued to the assessee on April 1, 2015. Based on the DVO’s report, the AO completed the assessment by making the aforementioned addition.
