A. P. RAVANI, J. ( 1 ) THOUGH labelled as first appeal in fact and in substance that is a second appeal under the provisions of Sec. 269h of the Income Tax Act 1961 in as much as the first appeal before the Appellate Tribunal is provided under Sec. 269g of the Act. Second appeal before High Court can be filed only on question of law. The appellant vendor having tailed before the lower authority has preferred this appeal. ( 2 ) THE appellant-vendor agreed to sell certain rights and interests in property in question by an agreement dated 22/04/1983 Sale deed took place on 20/09/1983 in which consideration of Rs. 8 lakhs was shown. The I. A. C. received 37g Form from the sub-registrar concerned. The referred the matter to District Valuation Officer who we are told is the statutory authority to deal with the valuation of the properties and is attached to the Income Tax Department. The I. A. C. also called for the report from the Inspector who submitted the valuation report on 4/05/1984 According to the report submitted by the Inspector the market value of the property on the relevant date was Rs. 14 88 45 The D. V. Os report dated 16/05/1984 discloses the valuation at Rs. 27 8 330 Since there was variation of more than 15 per cent in the amount of consideration mentioned in the document and the market value as disclosed in the report the I. A. C. initiated proceedings under Chapter XX-A of the Income Tax Act and notice was published in the Gazette dated 2/06/1984 ( 3 ) PURSUANT to the notice further proceedings were taken and ultimately acquisition order dated 30/04/1986 was passed by the competent authority. The vendor (appellant herein) viz. Shri Yashwantlal A. Patel and other vendors preferred appeal before the Appellate Tribunal being Appeal No. I. T. (Acq.) A. No. 6/ahd/1986. Similarly the vendee M/s. Purvi Construction also preferred appeal being Appeal No. I. T. (Acq) A. No. 5/ahd/1986 before the Appellate Tribunal. The appeal filed by the Purvi Construction has been decided by the Appellate Tribunal as per its judgment and order dated 2/12/1986 The appeal filed by the appellant herein has also been decided on the same day. Similarly the vendee M/s. Purvi Construction also preferred appeal being Appeal No. I. T. (Acq) A. No. 5/ahd/1986 before the Appellate Tribunal. The appeal filed by the Purvi Construction has been decided by the Appellate Tribunal as per its judgment and order dated 2/12/1986 The appeal filed by the appellant herein has also been decided on the same day. We are tole at the bar that the vendee M/s. Purvi Construction has not preferred any appeal before this High Court against the judgment and order passed by the Tribunal. ( 4 ) BEFORE the Tribunal the question as regards the maintainability of acquisition proceedings was raised. It was sought argued that the condition precedent for initiation of the proceedings was not complied with. It was also sought to be argued that when the proceedings were initiated only the Inspectors report was available and the Inspector had relied upon erroneous basis and therefore there was no material before the I. A. C. on the basis of which the proceedings could be initiated. The Tribunal negatived the aforesaid contention holding that at the stage of initiation of proceedings there should be some prima facie case. Initiation means and remains initiation and nothing more and initiation itself is not acquisition. ( 5 ) IT was also contended that the total area taken into consideration for the valuation was not correct. In essence it was submitted that the sale document has not been correctly interpreted and the Tribunal was not right in holding that 363. 03 sq. mt. of the basement built up by the appellant (delineated within the read line) has also been sold. As far as the method of valuation adopted by D. V. O. is concerned the Tribunal has accepted the contention and directed that the matter be resotred to the I. A. C. to take valuation as indicated in para 12 of its judgment. ( 6 ) IN this appeal the appellant submits that the following three questions of law arise: (1) Whether on the facts and circumstances of the case Income tax Appellate Tribunal was right in holding that initiation of the proceedings were valid? ( 6 ) IN this appeal the appellant submits that the following three questions of law arise: (1) Whether on the facts and circumstances of the case Income tax Appellate Tribunal was right in holding that initiation of the proceedings were valid? (2) Whether on the facts and circumstances of the case the Honble Tribunal was right in law in holding that at the initiation stage all that is necessary is that there should be some prima facie case when the basis on which the initiation is done itself was wrong? (3) Whether on the facts and circumstances of the case and in terms of the documents of sale agreement and sale deed executed by the appellant the Income-tax Appellate Tribunal was right in holding that 363. 03 sq mts. of the basement built up by appellant (delineated within red line) has been sold? ( 7 ) QUESTIONS No. 1 and 2 are inextricably connected with each other and therefore they may be disposed of together. Admittedly the I. A. C. bad at least the foiling materials before him when the acquisition proceedings were initiated. 1 Sale document2 Inspectors report. Even assuming for a moment that D. V. O. s report was not available at the time when the acquisition proceeding were initiated by the I. A. C. then also it cannot be said that the there was no material before the I. A. C. on the basis of which he could not have formed reason to believe that the acquisition proceedings be initiated. it is trite knowledge that in cases where the authority is empowered to exercise powers on the basis of his subjective satisfaction the scope of judicial review is limited. All that is required to be seen is whether there was some material on the basis of which the authority could have formed the opinion. Sufficiency or otherwise of the material or correctness or incorrectness of the opinion formed by the authority cannot be gone into by the Court. ( 8 ) SUCH questions have arisen in the matters under Sec. 147 of the Act. In connection with the proceedings under Sec. 147 of the Act the phrase reason to believe has been interpreted by the Supreme Court and by this High Court also. ( 8 ) SUCH questions have arisen in the matters under Sec. 147 of the Act. In connection with the proceedings under Sec. 147 of the Act the phrase reason to believe has been interpreted by the Supreme Court and by this High Court also. As per the settled legal position sufficiency or adequacy of the material before the authority exercising power cannot be gone into by she Court. If there is some material on the basis of which the authority concerned could have reasonably come to the conclusion ordinarily the Court would not interfere with the action taken by the authority. All that the Court has to see is that the belief entertained by the officer concerned should be founded on reason and not on fancy or speculation and that there should be some material on the bases of which such belief could have been entertained. The correctness or otherwise of the opinion termed cannot be gone into by the Court. This is so because the Court is not sitting in appeal over the decision of the authority concerned. ( 9 ) BE it noted that the principle embodied in this provision on the statute is even otherwise implicit. Assuming for a moment that the phrase reason to believe is not used in Sec. 269g under which the initial notice is to be issued there also if the provision is to be saved then the phrase reason to believe will have to be read by necessary implication. No power can be exercised otherwise than in accordance will reasons. Exercise of power otherwise than in accordance with reasons would amount to arbitrary exercise of power. Therefore it would be bad. In a system governed by rule of law the conferment of power carries with itself an implied obligation to exercise the same reasonably and not in accordance with ones own fancy or speculation. ( 10 ) ON facts of the case the Tribunal has come to the conclusion that there was sufficient material before the I. A. C. who is the competent authority to initiate the proceedings. The material which was in the shape of Inspectors report was correct or incorrect or whether it was based on some incorrect facts of otherwise court not have been gone into by the Tribunal. Similarly it cannot be gone into-by the Court. The material which was in the shape of Inspectors report was correct or incorrect or whether it was based on some incorrect facts of otherwise court not have been gone into by the Tribunal. Similarly it cannot be gone into-by the Court. At that stage the I. A. C. would be justified in proceeding on the footing that the report submitted by the Inspector was correct and it was based on correct material. This is so because pursuant to the notice that may be issued the party affected is required to be given adequate opportunity of being beard. It is always open to the party concerned to show that the belief entertained by the authority is not based on correct facts and that the correct facts are otherwise. If this can be shown satisfactorily the competent authority concerned may change its view. On the other hand after initiation of proceedings. further material also may be gathered and can be placed before the competent authority. At that stage the competent authority can utilise the entire material. At this stage even if it is shown that the material which was before the competent authority at the initial stage was not based on correct facts it cannot be said that the competent authority had no jurisdiction to initiate proceedings. ( 11 ) THE learned Counsel for the appellant has relied upon the following authorities which were also cited before the Tribunal. 1 Unique Associates Co-op. Housing Society Ltd. v. Union of India and Ors. (1986) 152 ITR 114 (Bom. ). 2 C. I. T. v. Arun Mehra (1986) 157 ITR 308 (Delhi ). In none of the aforesaid decisions cited by the learned Counsel for the appellant it is held that the correctness or otherwise of the material placed before the competent authority can be appreciated and can be gone into by the Court. This is so because the Court is not sitting appeal over the decision of the Tribunal. Therefore it cannot be said that since the Inspectors report was based on incorrect facts the competent authority had no jurisdiction to initiate the proceedings. In view of the aforesaid finding we do not think that the question Nos. 1 and 2 raised in this appeal and which have been reproduced hereinabove in para 6 arise in this appeal or that any error has been committed by the Tribunal in deciding the same. In view of the aforesaid finding we do not think that the question Nos. 1 and 2 raised in this appeal and which have been reproduced hereinabove in para 6 arise in this appeal or that any error has been committed by the Tribunal in deciding the same. ( 12 ) THE learned Counsel for the appellant has submitted that the Tribunal has erred in arriving at the conclusion that the part of the basement is also included in the property sold. We have been taken through the conveyance deed and the relevant part of the judgment and order of the Tribunal. We agree with the reasons given and conclusion arrived at by the Tribunal in this behalf. Hence question No. 3 also does not arise. ( 13 ) SINCE there was some error in the method adopted by the D. V. O. in arriving at the market value of the property the Tribunal passed the following order:"the matter is restored to the I. A. C to make valuation as indicated above and pass an order according to law The appeal is allowed for statistical purposes. On this point also we do not think that the Tribunal has committed any error". ( 14 ) WE do not find any error of law in the judgment sad order passed by the Tribunal. No question of law arises. Hence summarily dismissed. Notice discharged. Rule discharged. .