- (1.) Both the appeals have been filed by the Department under Section 260A of the Income Tax Act, 1961 against the consolidated judgment and order dated 07.10.2005, passed by the Income Tax Appellate Tribunal, Lucknow in I.T.A. Nos. 329 & 330/LUC/2000, for the block period ending on 14.05.1998.
(2.) On 09.07.2009 and 11.01.2010, a Coordinate Bench of this Court had admitted both the appeals on the following substantial question of law:- "Whether on the facts and in the circumstances of the case, the Hon'ble Income Tax Appellate Tribunal was justified in law in deleting the addition of Rs.8,65,566/- made by the A.O. on account of unexplained investment in property No.7/93-A, Tilak Nagar, Kanpur on the basis of report of the Departmental Valuer, ignoring the latest legal position as a result of insertion of Section 142-A by Finance Act (No.2), 2004 with retrospective effect from 15th November, 1972, which has the effect of nullifying the decision of Hon'ble Supreme Court of India in the case of Smt. Amiya Bala Paul reported in 262 ITR 407 (SC)"
(3.) The brief facts of the case are that a search under Section 132(1)(A) of the Act was conducted on 14.05.1998, at the business and residential premises of the assessee. During the course of search, books of account and the documents were found and seized. It was found that both the assessees have made investment in the property No. 7/93-A, Tilak Nagar, Kanpur. While explaining nature and source of investment in the construction of the said property, the assessee had deducted an amount of Rs.10,92,660/- towards the cost of furnishing. The assessee got the valuation of this property done by an approved valuer. However, the AO was not satisfied. So, he has referred the matter to the DVO, who vide his report dated 21.11.1998 has estimated the cost of construction. For the difference, the AO made the additions, which was partly upheld by the first appellate authority. The Tribunal has deleted the said addition. Being aggrieved, the Department has filed the present appeals.;