JUDGMENT M. Katju, J.
1. This writ petition has been filed for a writ of prohibition restraining the Assistant Valuation Officer, Income-tax, Lucknow from submitted a valuation report in pursuance of the direction issued by the Asst, Director of Investigation (ADI) (Inv.), Moradabad under Section 131(1) and (4) of the IT Act. The petitioner has also prayed for quashing of the report of the Asstt. Valuation Officer, Lucknow and for a prohibition retaining the ADI (Inv.), Moradabad from taking any action against the petitioner in pursuance of the said valuation report.
2. Heard learned counsel for the parties.
3. The petitioner is an individual and is a doctor by profession practising at Bijnor. In para 2 of the writ petition it is alleged that in the asst. yr. 1990-91 the petitioner made an investment of Rs. 65,700 and in the asst. yr. 1991-92 of Rs. 1,77,000. It is alleged in para. 3 of the writ petition that the petitioner duly showed the investment in the P&L a/c as well as balance sheets of those assessment years. True copy of the assessment orders for these years are Annexures 1 and 2 to the writ petition.
In the meantime the petitioner received a summon under Section 131 of the IT Act from the ADI (Inv.), Moradabad dt. 27th July, 1992, asking him to attend personally along with the assessment of any year of the petitioner. It is alleged that the assessment of the petitioner was being processed and completed at the IT office, Bijnor and the ADI (Investigation), Moradabad has nothing to do with the case. True copy of the notice under Section 131 is Annexure 3 to the writ petition.
In para 6 of the writ petition it is alleged that the petitioner duly supplied all the necessary information asked for vide letter dt. 19th Aug., 1992, Annexure 4 to the writ petition. True copy of the valuation report submitted before the ADI (Inv.) is Annexure 5 to the writ petition. It is alleged in para. 8 of the writ petition that despite this the ADI (Inv.), Moradabad acting under Section 131(1)(d) issued orders to the Valuation Officer, Lucknow to value the property. The petitioner was informed about this notice dt. 4th Nov., 1992, issued by the Asstt. Valuation Officer, Lucknow vide Annexure 6 to the writ petition. The petitioner filed a detailed reply before the valuation officer giving details vide letter dt. 5th Dec., 1992, Annexure 7 to the writ petition. Thereafter the Valuation Officer sent another letter to the petitioner expressing his intention to inspect the petitioner's building. It is alleged in para. 12 of the writ petition that the ADI (Inv.) has no power under the IT Act to refer the valuation of the property to the Valuation Officer. It is alleged that the power under Section 131(1)(d) is interconnected with the power under Section 132 relating to search and seizure. It is alleged that it is only when the search and seizure are contemplated and there is likelihood of huge amount of hidden wealth being found that as a preliminary step the power under Section 131(1A) can be exercised. It is alleged in para. 14 of the writ petition that no proceeding was pending before the IT authorities when the reference was made to the Valuation Officer. It is alleged that a reference can only be made when some assessment proceedings are pending and reference can only be made by the AO. The petitioner has relied on the judgment of this Court in V.K. Jain v. WTO (1991) 104 Taxation 210 (All). In that decision it has been held that a reference of the Valuation Officer under Section 16A of the WT Act can only be made when there are assessment proceedings pending before the WTO. The petitioner has alleged in para 18 that he has disclosed the entire cost of construction year-wise which is supported by the valuation report and hence the action of the ADI (Investigation) was illegal.
4. Learned counsel for the petitioner has also relied on the decision of the Supreme Court in Smt Amiya Bala Paul v. CIT. In that decision it was held by the Supreme Court that the power of AO under Section 131 of the IT Act is distinct from and does not included the power to refer a matter to the valuation Officer under Section 55A of the IT Act.
5. In our opinion the decision of the Supreme Court in Smt. Amiya Bala Paul's case (supra) is squarely applicable to the present case. The learned Departmental counsel has relied on the decision of the Gauhati High Court in CIT v. Smt. Amiya Bala Paul (1999) 240 ITR 378 (Gau) but that decision has been specifically reversed by the Supreme Court in the aforementioned decision.
6. In view of the above this writ petition is allowed. A writ of prohibition as prayed for is issued to the Asstt. Valuation Officer. A writ is also issued to the AO not to rely on the report of the Valuation Officer/Asstt. Valuation Officer.