Section 269 Income Tax Act 2025: Can a Tax Officer Order Property Valuation?
Section 269 of the Income-tax Act, 2025, titled Estimation of value of assets by Valuation Officer, authorises the Assessing Officer to obtain a professional valuation of an asset, property or investment for assessment or reassessment. The provision also sets out inspection powers, procedural protections, reporting deadlines and the treatment of valuation reports.
When can the Assessing Officer refer property for valuation?
Section 269(1): Reference to Valuation Officer
For assessment or reassessment, the Assessing Officer may refer an asset, property or investment to a Valuation Officer to estimate its value, including its fair market value, and obtain a valuation report. The power is not limited to immovable property: its wording extends to assets and investments generally.
Section 269(2): Books of account need not first be rejected
The Assessing Officer may make the reference whether or not satisfied about the correctness or completeness of the assessee's accounts. Consequently, rejection of books of account is not stated as a precondition to a valuation reference under this provision.
What inspection powers does the Valuation Officer have?
Section 269(3)(a) and (b): Entry, inspection and records
Subject to prescribed rules and reasonable times, the Valuation Officer, or an authorised engineer, overseer, surveyor or assessor, may enter land within the assigned area; enter relevant land, buildings or premises; and inspect an asset, property or investment referred for valuation. They may require necessary facilities for surveying, estimating value, inspecting relevant books and documents, and gathering valuation particulars.
Section 269(3)(c): Written notice and consent
For entry into premises covered by Section 269(3)(a)(ii), or inspection of assets covered by Section 269(3)(a)(iii), the provision requires consent of the person in charge, occupation or possession, following at least two days' written notice of the intended action. The statutory distinction between the categories of entry and inspection matters.
Section 269(3)(d): Consequences of refusal
If a person refuses or evades the obligation to provide required facilities, the Valuation Officer has specified powers equivalent to those of a civil court under the Code of Civil Procedure, 1908, concerning discovery and inspection, compelling attendance and examination on oath, production of documents, and issuing commissions. These are defined procedural powers, not an unrestricted power to determine tax liability.
How is the valuation made and used?
| Provision | Legal requirement |
|---|---|
| Section 269(4) | The Valuation Officer estimates value after considering evidence produced by the assessee and other available evidence, and after giving the assessee an opportunity of being heard. |
| Section 269(5) | Where the assessee does not cooperate or comply with directions, the Valuation Officer may estimate value to the best of his judgment. |
| Section 269(6) | The Valuation Officer sends the valuation report to both the Assessing Officer and the assessee. |
| Section 269(7) | An apparent mistake in the valuation report may be rectified in accordance with Section 287. |
| Section 269(8) | The Assessing Officer may consider the report in the assessment or reassessment only after giving the assessee an opportunity of being heard. |
| Section 269(10) | The Central Government may appoint Valuation Officers; specified senior income-tax authorities may appoint engineers, overseers, surveyors and assessors to assist them, subject to applicable service rules and orders. |
Important: A Valuation Officer's estimate is evidence for the assessment process. Section 269(8) expressly contemplates a further hearing before the Assessing Officer takes the report into account. The report is not, by itself, a final assessment order.
What is the deadline for the valuation report?
Section 269(9) requires the Valuation Officer to send the report within six months from the end of the month in which the Assessing Officer makes the reference.
Relevant statutory terms and definitions
Practical examples
Example 1 - Construction cost: During scrutiny of a building investment, the Assessing Officer questions the reported construction cost and refers the property for valuation. The assessee may furnish contractor bills, architectural plans and supporting records to the Valuation Officer.
Example 2 - Inspection notice: An officer proposes to inspect a property covered by Section 269(3)(a)(ii). The statutory written-notice and consent requirements in Section 269(3)(c) must be considered before the proposed entry.
Example 3 - Valuation disagreement: A valuation report estimates a higher value than the taxpayer's records. Before taking the report into account in assessment, the Assessing Officer must provide the taxpayer an opportunity of being heard under Section 269(8).
Example 4 - Non-cooperation: A taxpayer repeatedly fails to provide relevant valuation documents despite lawful directions. Section 269(5) permits a best-judgment estimate, making timely and documented cooperation important.
Frequently asked questions
Can the Assessing Officer refer property for valuation without rejecting the books of account?
Yes. Section 269(2) expressly permits a reference whether or not the Assessing Officer is satisfied about the correctness or completeness of the accounts.
Is the valuation power restricted to land and buildings?
No. Section 269(1) refers to any asset, property or investment, subject to the purpose of assessment or reassessment and the applicable legal framework.
Must the Valuation Officer hear the taxpayer?
Yes. Section 269(4) requires an opportunity of being heard before the ordinary valuation estimate is made. Section 269(8) also provides for a hearing before the Assessing Officer takes the report into account.
How much notice is required before inspection?
For the specified entry and inspection covered by Section 269(3)(c), at least two days' written notice and the stated consent requirement apply.
When must the Valuation Officer submit the report?
Within six months from the end of the month in which the reference was made, under Section 269(9).
Does the valuation report automatically determine taxable income?
No. The Assessing Officer may take the report into account after hearing the assessee. The assessment or reassessment is made under the applicable assessment provisions.
What was the corresponding provision in the Income-tax Act, 1961?
The corresponding provision is Section 142A of the Income-tax Act, 1961, not its Section 269.
Official statutory source and further reading
Read the Income-tax Act, 2025 as amended by the Finance Act, 2026 for the authoritative wording, and consult the Income Tax Department for notifications and rules. The provisions should be read with Section 268 (Inquiry before assessment), Section 270 (Assessment) and Section 287 (Rectification of mistake).
Last reviewed: 11 November 2026. This article provides general statutory information and does not replace advice on the facts of an individual assessment.