Power of Assessing Officer to make a reference to the Valuation Officer [Section 142A] :
(i) Under the erstwhile section 142A, the Assessing Officer was empowered to make a reference to the Valuation Officer to estimate the value of any investment referred to in section 69 or section 69B, any bullion, jewellery or other valuable article referred to in section 69A or section 69B or the fair market value of any property referred to in section 56(2) for the purpose of making an assessment or reassessment. The Assessing Officer may, on receipt of the report of the Valuation Officer, take into account such report for the purposes of assessment or reassessment after giving the assessee an opportunity of being heard.
(ii) The scope of section 142A was, thus, restricted in the sense that the Assessing Officer could make a reference to the Valuation Officer to estimate the value of investment/article only under the specific sections mentioned thereunder, namely, sections 69, 69A, 69B, and 56(2). Further, section 142A did not also provide for any time limit for furnishing of the report by the Valuation Officer.
(iii) In order to expand the scope of making reference to Valuation Officer and to provide for a time limit for furnishing of the report by the Valuation Officer, section 142A has been substituted with effect from 1st October, 2014. The new section 142A also expressly clarifies that there is no pre-condition that books of account have to be rejected for the purpose of making a reference to the Valuation Officer for estimation of the value of any investment or property.
(iv) As per new section 142A, the Assessing Officer may, for the purposes of assessment or reassessment, make a reference to a Valuation Officer to estimate the value, including fair market value, of any asset, property or investment and submit the report to him. Thus, the scope of section 142A has been widened by removing references to the specific sections for which reference can be made by the Assessing Officer to the Valuation Officer.
(v) New section 142A further clarifies that the Assessing Officer may make a reference to the Valuation Officer whether or not he is satisfied about the correctness or completeness of the accounts of the assessee.
(vi) The Valuation Officer, shall, for the purpose of estimating the value of the asset, property or investment, have all the powers of section 38A of the Wealth-tax Act, 1957.
(vii) The Valuation Officer is required to estimate the value of the asset, property or investment after taking into account the evidence produced by the assessee and any other evidence in his possession gathered, after giving an opportunity of being heard to the assessee.
(viii) If the assessee does not co-operate or comply with the directions of the Valuation Officer he may, estimate the value of the asset, property or investment to the best of his judgment.
(ix) The Valuation Officer shall send a copy of his estimate to the Assessing Officer and the assessee within a period of six months from the end of the month in which the reference is made. Thus, a specific time limit has now been provided, within which the Valuation Officer has to send his report to the Assessing Officer.
(x) On receipt of the report from the Valuation Officer, the Assessing Officer may, after giving the assessee an opportunity of being heard, take into account such report in making the assessment or reassessment.