BENCH These are the appeals filed by the assessee against the orders dated 08/09/2015, 11/12/2014 and 08/09/2015, passed by the learned CIT(A), Ajmer for A.Ys. 2008-09 to 2012-13. The effective grounds of all the appeals are as under:- Grounds of ITA No. 992/JP/2015 1 That the Ld. CIT(A) is not justified in restricting the rebate for self supervision at 7.5%. ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 2

2. That the ld CIT(A) is not justified in maintaining expenses on account of Architecture Expenses at Rs. 85,987/- as against expenditure of Rs. 10,000/- by the assessee.

3. That the ld CIT(A) is not justified in sustaining addition on account of difference in cost of construction at Rs. 4,55,379/- in the year under consideration. Grounds of ITA No. 993/JP/2015 1 That the Ld. CIT(A) is not justified in restricting the rebate for self supervision at 7.5%.

2. That the ld CIT(A) is not justified in maintaining expenses on account of Architecture Expenses at Rs. 85,987/- as against expenditure of Rs. 10,000/- by the assessee.

3. That the ld CIT(A) is not justified in sustaining addition on account of difference in cost of construction at Rs. 5,06,752/- in the year under consideration. Grounds of ITA No. 260/JP/2015 1 That the Ld. CIT(A) is not justified in restricting the rebate for self supervision at 7.5%.

2. That the ld CIT(A) is not justified in maintaining expenses on account of Architecture Expenses at Rs. 85,987/- as against expenditure of Rs. 10,000/- by the assessee.

3. That the ld CIT(A) is not justified in sustaining addition on account of difference in cost of construction at Rs. 5,75,206/- in the year under consideration. Grounds of ITA No. 994/JP/2015 1 That the Ld. CIT(A) is not justified in restricting the rebate for self supervision at 7.5%. ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 3

2. That the ld CIT(A) is not justified in maintaining expenses on account of Architecture Expenses at Rs. 85,987/- as against expenditure of Rs. 10,000/- by the assessee.

3. That the ld CIT(A) is not justified in sustaining addition on account of difference in cost of construction at Rs. 1,00,662/- in the year under consideration. Grounds of ITA No. 995/JP/2015 1 That the Ld. CIT(A) is not justified in restricting the rebate for self supervision at 7.5%.

2. That the ld CIT(A) is not justified in maintaining expenses on account of Architecture Expenses at Rs. 85,987/- as against expenditure of Rs. 10,000/- by the assessee.

3. That the ld CIT(A) is not justified in sustaining addition on account of difference in cost of construction at Rs. 93,303/- in the year under consideration.

2. All the grounds of all the assessees appeals are against restricting the rebate for selling supervision @ 7.5%, excessive fees estimated for architecture and resultant addition made U/s 69 of the Income Tax Act, 1961 (in short the Act). The assessee derived interest income on sums advanced in the market and capital gain. The cases for A.Y. 2008-09, 2009-10 and 2011-12 were reopened U/s 148 and assessed U/s 143(3) of the Act and cases for A.Y. 2010-11 and 2012-13 were assessed U/s 143(3) of the Act. The ld Assessing Officer observed that there was a survey U/s 133A of the Act on 17/11/2009 in the ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 4 premises of MAD About Food (Asha Grand), Vaishali Nagar, Main Road, Ajmer. This building was owned and built by Shri Ram Chand Ludhani (assessee) and a part of it has been given on rent to his son Shri Deepak Ludhani and he is running business in the name of MAD About Food. During the course of survey, no unaccounted income was disclosed. However, at the time of filing of return of income, the assessee disclosed Rs. 13,00,000/- under the head income from other sources. Return for A.Y. 2010-11 was filed on 30/09/2010 declaring total income of Rs. 17,22,980/-. The case was scrutinized U/s 143(3) of the Act vide order dated 22/3/2013 by the Assessing Officer. The ld Assessing Officer further observed that the assessee had built a building namely Asha Grant at Vaishali Nagar, Ajmer and submitted purchase bills and details of cheques issued for payments during the course of survey. The bills submitted were verified from the parties but the following parties have not complied: (i) Deepak Enterprises. (ii) M/s Mata Vaishno Devi Bricks Udyog. (iii) M/s Vaishna Devi Bricks Udyog. (iv) Promila tractors. (v) M/s Keshav Associates. (vi) Rishabh Enterprises. (vii) Oswal Marbles. (viii) Bajaj Iron & Steels Rerolling Mills and (iv) Vimal Electrical. ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 5 Further the following parties had denied to have sold goods:- (a) M/s Bhagwati Enterprises. (b) M/s B.P. Industries (c) Prem Electricals (d) V.K. Hardware Stores As per balance sheet, the assessee has disclosed cost of construction at Rs. 66,16,990/-. The ld Assessing Officer referred this building to the DVO. As per valuers report, the construction cost estimated as under:- Financial year Cost of construction of the building as Declared by the assessee excluding Fixed expenses Estimated by the valuer excluding fixed expenditure 2007-08 12,35,006 21,70,089 2008-09 13,74,332 24,14,905 2009-10 15,59,982 27,41,120 2010-11 2,72,999 4,79,700 2011-12 2,53,040 4,44,629 Total 46,95,359 82,59,443 There was a difference between cost of construction estimated by the DVO and cost declared by the assessee in all the years, therefore, the ld Assessing Officer gave reasonable opportunity of being heard. During the assessment year 2010-11, the assessee had disclosed cost of construction at Rs. 15,59,982/- whereas as per DVO report, it was Rs. 27,41,120/-. The assessees raised various objections before the Assessing Officer that the DVO had considered the CPWD rate whereas it should be PWD rate and there is a difference of near about 20% in ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 6 estimating the cost of construction by the DVO. The supervision charges is to be reduced @ 10% on total cost estimated. However, the DVO has considered supervision charges @ 5%. The DVO also has taken architecture fees @ 1% on total cost. However, the assessee had paid Rs. 10,000/- only. The assessee also argued before the Assessing Officer that the assessee purchased the material on discounted price, which varies from 10% to 20% being relation with the supplier. After considering the assessees reply, the ld Assessing Officer has held as under:-

1. A sum of Rs. 10,000/- shown by the assessee for architect fee i.e. for drawing, planning and technical consultation charges are on very very lower side (keeping in view of constructing RCC framed multistoried modern structure having 1417.54 square meters plinth area). Moreover the assessee or his close relatives are neither an architect nor civil engineer. Normally architect, charges @2 to 4% of total cost of the project as his fees. In this case, keeping in view the efforts of procurement of materials etc, of the assessee on this account only 1% element is considered while working out the estimated valuation of this property. Hence this provision is correct and reasonable.

2. The CPWD plinth area rates adopted for estimating construction / valuation of property are as per approved ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 7 CBDT guidelines, for valuation of properties referred by Income-tax Department, vide Instruction No. 1671 and enhanced with weighted cost index for that particular station. The PWD Raj. Rates X-3 are got no approval from CBDT. Standing order X-3 rates are basically meant for hiring of buildings by Government departments as mentioned in their circular itself, therefore these are not so rational. Different type of buildings have different plinth area rates, but in PWD Raj X-3 rates, there is no provision of different rates for different types of buildings such as residential category (Type I to Type VI), Schools, office buildings, hospitals, hostels, auditoriums, godowns etc. whereas in CBDT approved rates, different rates are available for different types of buildings. CBDT approved rates are adopted in this case, hence are correct and relevant. The specifications of structure/buildings provided in standing order X-3 of Raj. PWD are too brief to be applied with reasonable accuracy and does not cover wide range of specifications. The entire specification is covered only in about 8 lines or so. This is totally unrealistic & leaves lot of room for manipulations of cost of construction i.e. the valuation. Whereas the specifications of CBDT approved method are very exhaustive, elaborate and rational. ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 8

3. The assessee has submitted bills/vouchers for materials elements only and proofs for labours like muster rolls/wages registers giving details of labour employed, wages paid etc. are not furnished by assessee as already mentioned in valuation report, therefore, self supervision rebate of 5% is considered in valuation report as applicable in this case. Hence the rebate considered in report is reasonable and correct.

4. Area determined is again got verified and observed same as adopted in valuation made by the departmental value on site inspection on dated 05/03/2013 and the same is endorsed by the A/R.

The ld Assessing Officer made addition on the basis of DVOs report as under:- 2008-09 Rs. 9,35,083/- 2009-10 Rs. 10,40,573/- 2010-11 Rs. 11,81,138/- 2011-12 Rs. 2,06,701/- 2012-13 Rs. 1,91,589

3. The assessee challenged the addition before the ld CIT(A), who had allowed the appeal partly by observing as Under:- 3.3 I have considered the contention of the appellant as well as the assessment order. It is seen that the valuation officer has valued the property for the A.Y. 2010-11 and valuation ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 9 is not as on the date of the inspector i.e. 08/11/2011 as claimed by the assessee. The A.O. has mentioned that assessee has constructed RCC frame multistoried modern building having 1417 sq. plinth area as against which architect fees have been shown to be Rs. 10,000/- only while the A.O. estimated it to be 1% of the cost i.e. Rs. 85,987/-. The assessee claimed that only Rs. 10,000/- were paid for plan prepared for the purpose of submission of the plan seeking sanction from the local authorities and remaining layout plans and details were worked with the help of draftsman. However, the assessee has not shown any payment to have been made to the draftsman. Looking structure constructed, charges determined by A.O. are reasonable. In view of above, the A.Os estimation of 1% charges for drawing, planning and technical consultant charges amounting to Rs. 85,987/- is reasonable and no further rebate can be allowed to the assessee on this account. However, issues regarding application of local CPWD rates and rebate for self supervision are covered by the decision of my learned predecessor in Appeal No. 56/2006-07 in order dated 19/03/2008 as under:-

3.3 The argument of the appellant and facts of the case have been carefully considered. It has been held by the Honble ITAT, Jaipur Bench the case of Bhanwar Lal Solanki Vs. ITO in ITA No. 669/JP/95 that 20% deduction is allowable to the assessee for the difference ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 10 between CPWD and PWD rates, where the construction has been done at PWD rates, but the valuation is on the basis of CPWD rates. The same view has been taken by Honble ITAT in the following cases: (a) Ravi Mathur & ors. Vs ACIT as reported XXII Tax World 245. (b) Mushtaq Ahmed Vs. ACIT as reported XXII Tax World 25.

3.4 It has been also observed by Honble ITAT Jaipur Bench that rebate for self supervision should be normally given at 10%. In view of above decision, the appellant is entitled to reduce sum of 20% on account of difference between CPWD and PWD rates and 10% on account of self supervision.

In view of above discussion and decision, it is apparent that discount of 20% needs to be given by applying local PWD rates in the case of the assessee. Further, as regarding the self supervision, rebate upto 7.5% in place of 10% claimed by the A.O. is reasonable as assessee has not submitted evidence regarding engagement of labour and wages paid. As additional 2.5% for self supervision) and addition made by the A.O. to this extent is deleted and balance amount is confirmed. The other yeas have been decided by the ld CIT(A) on the basis of finding given in A.Y. 2010-11.

4. Now the assessee is in appeal before us. The ld AR of the assessee has reiterated the arguments made before the ld CIT(A) and ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 11 argued that there is no reason to confirm the addition on account of architect fees @ 1%. There is no evidence with the department that the assessee has paid much more that claim in the cost of construction i.e. Rs. 10,000/-. Whereas in all the years, the DVO estimated the architect fees expenses @ 1%. He has further argued that the DVO as well as the Assessing Officer allowed the supervision charges @ 5%. However, which has been allowed by the ld CIT(A) @ 7.5% but it is decided by the various ITATs and Honble High Courts that supervision @ 10% can be given on estimated cost of construction. Thereafter the difference is only 17.10% between the cost of construction estimated by the DVO and cost of construction declared by the assessee. Accordingly, he prayed that assessees appeal may please be allowed.

5. At the outset, the ld DR has vehemently supported the order of the ld CIT(A) and argued that the ld CIT(A) has already allowed difference on account of CPWD rate and PWD rate and supervision charges, therefore, assessees appeal is required to be dismissed.

6. We have heard the rival contentions of both the parties and perused the material available on the record. There is no evidence before the ld. Assessing Officer or ld CIT(A) that the assessee had paid to architect more than Rs. 10,000/- whereas it has been taken @ 1%. The ld Assessing Officer had not brought on record any evidence to ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 12 prove that the assessee had paid much more than claimed in the cost of construction i.e. Rs. 10,000/-. Therefore, we have considered view that the addition in the cost of construction on account of architect fees is to be considered Rs. 10,000/-. Further the various ITATs as well as Honble High Courts had decided that self supervision rebate can be given up to 10% on cost of construction. The ld CIT(A) had allowed 7.5%, however, we decided to allow self supervision out of cost of construction estimated @ 10%. Accordingly, we allow the assessees appeal partly. The ld Assessing Officer is directed to compute the addition U/s 69 of the Act on the basis of above findings in all the years.

7. In the result, all the five appeals of the assessee are allowed partly. Order pronounced in the open court on 25/5/2016. Sd/- Sd/- vkj-ih-rksykuh Vh-vkj-ehuk (R.P.Tolani) (T.R. Meena) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member Tk;iqj@Jaipur fnukad@Dated:- 25 th May, 2016 *Ranjan vknsk dh izfrfyfi vxzsfkr@Copy of the order forwarded to:

1. vihykFkhZ@The Appellant- Shri Ram Chand Ludhani, Ajmer.

2. izR;FkhZ@ The Respondent- The ACIT, Circle-2, Ajmer.

3. vk;dj vk;qDr@ CIT ITA 992, 993, 260, 994 & 995/JP/2015_ Ram Chand Ludhani Vs. ACIT 13

4. vk;dj vk;qDrvihy@The CIT(A)

5. foHkkxh; izfrfuf/k] vk;dj vihyh; vf/kdj.k] t;iqj@DR, ITAT, Jaipur

6. xkMZ QkbZy@ Guard File (ITA No. 992, 993, 260, 994 & 995/JP/2015) vknskkuqlkj@ By order, lgk;d iathdkj@Asst. Registrar