2002 PLP (Trib (PTD)

The respondent had disposed off plant and machinery, motor vehicles, furniture and fixture etc. during the year for a total consideration of Rs. 11,74,

842. The Assessing Officer, however, was of the opinion that sale consideration shown was lesser than the fair market value of the assets sold and he proceeded to make an addition of Rs. 531,173 to the income after estimating the fair market value of each asset separately. The CIT(A) after hearing the respondent deleted the addition as the Assessing Officer had, in his view, failed to evolve any basis of his estimate of the fair market value and even he had not made any physical Enquiries in this connection. The D.R. while supporting the assessment order prays for reversal CIT(A)'s findings. The A.R. for the respondent on the other hand has made the following submission: (1) The Assessing Officer had failed to appreciate the facts of the case as evident from the fact that a vehicle described by him as a Mercedes Benz Car was in fact a pickup with a Mercedes Benz Engine. (ii) The respondent had sold its assets to a sister concern under an agreement. The learned A.R. for the respondent has also placed reliance on the following cases: (1) 1983 PTD

429. In this case, it was held that transfer of assets for company to firm was not a sale so as to, justify allowance of depreciation on book value and two different standard or basis for valuing same assets in the hands of the different entities, i.e. transferor and transferee cannot be adopted and provisions of sec?tions 10(2)(vii) of the Income-tax Act, 1922 are not applicable in the circumstance of the case. Since the provisions of the cited section of the repealed Act and rule 8(5) are indentical, the addition was also not warranted. 2. 1998 PTD 2989. In this case it was held that estimate in the value of assets was not in accordance with the law when no instance of unverifiability or reason or evidence in support of value estimate was given. After consideration of the matter, it is evident that the Assessing Officer has not given any basis for his estimate, we, therefore, would have no hesitation in upholding the CIT(A)'s order on this point. The Departmental appeal accordingly fails. Assessee Appeal: The assessee's A.R. has objected to CIT(A)'s confirmation of the disallowance of Rs. 18,070 made out of miscellaneous expenses claimed. The A.R. has made the following submissions in this connection. (1) The claim for the year under this head was only Rs. 36,140 as against the claim of Rs. 216,782 of last year. Thus, CIT(A) was not justified in holding that the addition made was in accordance with the history of the case. (2)??????? The Assessing Officer had failed to obtain details of these expenses. In fact the claim under this head represented adjustment of sales tax of previous years. The arguments have been considered. It is apparent that Assessing Officer has not examined the relevant aspects thoroughly. This addition is accordingly set aside for fresh examination and action in accordance with the law after providing the assessee an opportunity to present his case. C.M.A./M.A.K./160/Tax(Trib.) ????????????????????????????????????????????????????????? Order accordingly.