R.K.Gulati, J. - (1.) These are two connected applications under Section 27(3) of the Wealth-tax Act, 1957 (for short "the Act"), filed by the Commissioner of Wealth-tax, Agra, relating to the assessment years 1978-79 and 1979-80.
(2.) In the wealth-tax assessments for the aforesaid two years, the assessing officer determined the fair market value of an immovable property described as "Dehradun property" at Rs. 7,35,086 as on the two valuation dates relevant for the years in dispute. After the completion of those assessments, the Commissioner of Wealth-tax initiated proceedings under Section 25(2) of the Act, calling upon the assessee to show cause why the wealth-tax assessment orders for the years in dispute may not be cancelled, so as to be made afresh as the "Dehradun property" had been undervalued by the assessing officer. It appears that, after the completion of the assessments, the assessing officer learnt that the property was sold by the assessee on August 18, 1983, for a consideration of Rs. 36 lakhs and this information prompted the Commissioner to take proceedings under Section 25(2) of the Act.
(3.) After considering the objections filed by the assessee, the Commissioner of Wealth-tax set aside the assessment orders so far as the valuation of the "Dehradun property", was concerned for fresh assessment. He held the impugned assessment orders to be erroneous and prejudicial to the interests of the Revenue on the view that in an inflationary economy, when prices of land and house properties are rising constantly, it was necessary for the assessing officer to make full and detailed enquiries before accepting the assessee's value report and past figures of valuation of that property. He further held that the valuation adopted by the assessing officer was done in a perfunctory manner without proper scrutiny and application of mind which rendered the assessment orders erroneous and prejudicial to the interests of the Revenue.;