Sohani, J. - This is an application u/s 256(2) of the IT Act, 1961 (hereinafter referred to as the Act).
2. The material facts giving rise to this application, briefly, are as follows :
The assessee is assesses in the status of an association of person and the assessment year in question is 1974-75. In the asst. yr. 1973-74, the assessee had purchased a plot of land for Rs. 10,523 and constructed a house thereon. According to the assessee, the cost of construction was Rs. 1,09,700. The ITO got the house valued by the Departmental Valuer, who estimated its value at Rs. 1,71,310. The ITO accepted the cost of the house estimated by the Departmental Valuer and he accordingly made an addition of Rs. 61,610 on account of income from undisclosed sources. On appeal, the AAC held that the assessee had maintained accounts and the ITO had not brought any material on record to show way why these accounts were nit acceptable. The AAC therefore, deleted the entire addition made by the ITO. Aggrieved by that order, the department preferred an appeal. The Tribunal observed as follows :
'It may be mentioned that even the assessees valuer has not accepted the assessees own figure of cost, which has been placed at only Rs. 1,09,700. According to the report of the Registered Valuer itself, the cost would come to Rs. 1,39,000 about which we have commented, is a bit low and, therefore, the figure of Rs. 1,40,000 should be deemed to include the saving, which the assessee could have made by his personal supervision and use of tractor. A net addition of at least Rs. 30,000 is, therefore, called for.'
Aggrieved by the decision of the Tribunal, the assessee sought a reference but the application for making a reference was rejected. Hence, the assessee has filed this application.
3. Having heard ld. counsel for the parties, we have come to the conclusion that this application deserve to be rejected. Though a number of questions were framed in the application, they centre round two contentions :
(1) Whether, the Tribunal was justified in not applying the provisions of section 26 of the Act to the facts of case; and
(2) Whether, the Tribunal was justified in relying upon the opinion of the Departmental Valuer ?
4. As regards the first question, it does not arise out of the order of the Tribunal. In the order of the Tribunal, there is no reference at all to s. 26 of the Act. Learned counsel for the assessee contended that question was argued before the Tribunal but it is difficult to uphold this contention in view of the fact that there is no reference at all to s. 26 in the order of the Tribunal.
5. As regards reliance on the report of the Departmental Valuer, we may usefully refer to the following observations of the Tribunal in its order rejecting the application u/s 256(1) of the Act :
'We found that the assessees Valuer himself had not accepted the assessees own figure of cost, which he had placed at Rs. 1,09,700 but he estimated the same at Rs. 1,39,000. We nearly accepted his estimate and rounded off the figure to Rs. 1,40,000. Of course, we did not reduce the estimate further by some extra saving the estimate further by some extra saving alleged to have been made by the assessee and were of the opinion that the figure already estimated by the assessees Valuer was rather low and should be deemed to include the extra saving made by him. But we have not accepted the report of the Departmental Valuation Officer, whose estimate of cost to Rs. 1,71,310. We only used that report for the purpose of understanding the nature of construction and the material used therein.'
6. Under the circumstances, the Tribunal was right in holding that no question of law arose out of the order passed by the Tribunal. The application is accordingly rejected. Parties shall bear their own costs of this application.