DCIT, Central Cirlce-1(3), Hyd, Hyderabad V. Cherukuri Swapna, Hyd, Hyderabad

ITA 1016/HYD/2016

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 6211 (ITAT-HYDERABAD)
• Duration Of Justice: 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-02-2017
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 14-07-2016
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: U. MINI CHANDRAN
• Assessee Lawyers: J.J. VARUN
• Keywords: Competent authority; Capital expenditure
• Section: 32; 147; 131; 68; 246; 69; 145; 27; 148; 54; 37; 6; 56; 263; 63; 132; 12; 28; 144; 10; 90; 154; 2; 11; 15; 271(1)(b); 139; 143(3); 92; 80IB

Judgement Text

IN THE INCOME TAX APPELATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI INTURI RAMA RAO, ACCOUNTANT MEMBER ITA.NO.1016/HYD/2016 ASSESSMENT YEAR 2011-2012 DCIT, CENTRAL CIRCLE-1(3), HYDERABAD. VS. SMT. CHERUKURI SWAPNA, HYDERABAD. PAN ACGPG3296C (APPELLANT) (RESPONDENT) FOR REVENUE : SMT. U. MINICHANDRAN FOR ASSESSEE : SHRI J.J. VARUN DATE OF HEARING : 06.02.2017 DATE OF PRONOUNCEMENT : 10.02.2017 ORDER PER INTURI RAMA RAO, A.M. THIS APPEAL IS FILED BY THE REVENUE IS DIRECTED AG AINST THE ORDER OF THE LD. CIT(A)-11, HYDERABAD DATED 31.03 .2016 AND IT PERTAINS TO THE A.Y. 2011-2012. 1.1. THE REVENUE RAISED THE FOLLOWING GROUND S OF APPEAL : 1. WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE, TH E CIT(A) HAS CORRECTLY APPLIED THE DECISION OF THE IT AT OF EARLIER YEARS, IN SO FAR AS THE HONBLE ITAT DID NO T DISPOSE OFF ANY GROUND PERTAINING TO THE ISSUE OF COMPLETIO N CERTIFICATE. 2. THE CIT(A) ERRED IN RELYING UPON THE ORDER OF THE I TAT FOR A.YS. 2009-10 AND 2010-11 WHICH ARE CONTRARY TO LAW S AND DELETING THE ADDITION MADE BY THE ASSESSING OFF ICER UNDER SECTION.80IB(10) WITHOUT CONSIDERING THE FACT THAT THE ASSESSEE VIOLATED THE CONDITIONS. 2 ITA.NO.1016/HYD/2016 SMT. CHERUKURI SWAPNA, HYDERABAD. 2. BRIEF FACTS OF THE CASE ARE THAT THE RESPONDENT- ASSESSEE IS AN INDIVIDUAL ENGAGED IN THE BUSINESS OF BUILDER IN THE NAME AND STYLE OF M/S. LAHARI CONSTRUCTION. THE RE TURN OF INCOME FOR THE A.Y. 2011-2012 WAS FILED ON 30.09.201 1 DECLARING TOTAL INCOME OF RS.6 LAKHS. WHILE DOING SO, THE RESPO NDENT- ASSESSEE CLAIMED DEDUCTION OF RS.1,32,40,867 UNDER TH E PROVISIONS OF SUB-SECTION (10) OF SECTION 80IB OF THE ACT. AGAINST THE SAID RETURN OF INCOME, THE ASSESSMENT WAS COMPLETED BY THE DCIT, CENTRAL CIRCLE-VI, HYDERABAD (HEREINAFTER CALL ED AS A.O.) VIDE ORDER DATED 26.03.2014, UNDER SECTION 143(3) OF THE I.T. ACT, 1961, ON A TOTAL INCOME OF RS.2,85,39,349. WHILE DOI NG SO, THE ASSESSING OFFICER DISALLOWED THE CLAIM OF DEDUCTION OF RS.1,30,23,641 CLAIMED UNDER THE PROVISIONS OF SUB-S ECTION (10) OF SECTION 80IB OF THE ACT ON THE GROUND THAT THE RESPO NDENT- ASSESSEE FAILED TO COMPLY WITH THE NOTICE DATED 11.02 .2014 SEEKING CERTAIN DETAILS IN RESPECT OF THE CLAIM UNDER SECTION 80IB AND ALSO NOTICED THAT THE COMPLETION CERTIFICATE FROM THE PRESCRIBED AUTHORITY IS DATED 12 TH MARCH, 2012 AND THEREFORE, THE ASSESSING OFFICER INFERRED THAT THE PROJECT WAS COMPLET ED DURING THE F.Y. RELEVANT TO THE A.Y. 2012-2013 AND ACCORDINGLY , HE DISALLOWED THE CLAIM UNDER SECTION 80IB OF THE ACT. TH E ASSESSING OFFICER ALSO MADE AN ADDITION OF RS.1,49,15,708 BEIN G THE AMOUNT OF ADDITION TO THE CAPITAL OF THE RESPONDENT-ASSE SSEE AS HE HAD FAILED TO EXPLAIN THE SOURCE OF THE CAPITAL INTRO DUCED. 3. BEING AGGRIEVED BY THE ABOVE DISALLOWANCES, AN APPEAL WAS PREFERRED BEFORE THE CIT(A) WHO VIDE IMPUGNED OR DER HAD ALLOWED THE APPEAL. AS REGARDS THE DISALLOWANCE OF CL AIM UNDER THE PROVISIONS OF SECTION 80IB OF THE ACT, THE LD. CIT( A) ALLOWED THE CLAIM FOLLOWING THE ORDER OF ITAT IN ASSESSEES O WN CASE FOR 3 ITA.NO.1016/HYD/2016 SMT. CHERUKURI SWAPNA, HYDERABAD. THE A.Y. 2009-2010 (ITA.NO.183/HYD/2014 DATED 12.06.2 015 AND A.Y. 2010-2011 (ITA.NO.412/HYD/2015 DATED 26.06. 2015). WITH REGARD TO THE ADDITION ON ACCOUNT OF CAPITAL CONTRI BUTION OF RS.1,49,15,708, THE CIT(A) HAS DELETED THE ADDITION BY HOLDING THAT THERE WAS A SUFFICIENT SOURCE FOR INTRODUCTION OF TH E CAPITAL EXPENDITURE BY WAY OF THE SALE CONSIDERATION RECEIVED IN RESPECT OF SALE OF PROPERTY. 4. BEING AGGRIEVED BY THE ABOVE DIRECTION OF THE CIT( A), THE REVENUE IS IN APPEAL BEFORE US CHALLENGING THE ON LY DIRECTION OF THE CIT(A) IN ALLOWING THE CLAIM OF DEDUCTION UNDER SECTION 80IB(10) OF THE I.T. ACT, 1961. 5. THE LD. D.R. SMT. U. MINICHANDRAN HAD CONTENDED THAT THE LD. CIT(A) OUGHT NOT HAVE FOLLOWED THE ORDER OF THIS TRIBUNAL IN ASSESSEES OWN CASE FOR THE A.YS. 2009-1 0 AND 2010- 2011 INASMUCH AS THE FACTS ARE DISTINGUISHABLE. THE LD . D.R. VEHEMENTLY CONTENDED THAT THE ISSUE INVOLVED BEFORE THE T RIBUNAL IN THE EARLIER ASSESSMENT YEAR IS WHETHER THE AREA OF EACH FLAT EXCEEDED 1500 SQ. FEET OR NOT. WHEREAS IN THE PRESENT Y EAR SINCE THE COMPLETION CERTIFICATE WAS DATED 12 TH MARCH, 2012 IT GOES TO PROVE THAT THE COMPLETION OF THE PROJECT WAS COMPLETED O NLY IN THE A.Y. 2012-2013 AND THEREFORE, THE ISSUE OF ELIGIB ILITY FOR DEDUCTION UNDER SECTION 80IB IS TO BE EXAMINED DURING THE PREVIOUS YEAR RELEVANT TO THE A.Y. 2012-2013. 7. ON THE OTHER HAND, THE LD. AUTHORISED REPRESENTATIVE FOR THE RESPONDENT-ASSESSEE SHRI J.J. VARUN SUBMITTED THAT THE FACTS ARE IDENTICAL AND THE ORDER OF THE TRIBUNAL IN TH E EARLIER YEARS IS SQUARELY APPLICABLE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION. 4 ITA.NO.1016/HYD/2016 SMT. CHERUKURI SWAPNA, HYDERABAD. 8. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. THE ISSUE THAT COMES UP FOR CONSI DERATION IS ABOUT THE ELIGIBILITY OF THE RESPONDENT-ASSESSEE TO CL AIM OF DEDUCTION UNDER THE PROVISIONS OF SUB-SECTION (10) OF SECTION 80IB OF THE ACT. THE ASSESSING OFFICER HAD DENIED THE CLAIM ESSENTIALLY ON TWO COUNTS (A) THAT ASSESSEE HAD FAIL ED TO COMPLY WITH THE NOTICE ISSUED BY THE ASSESSING OFFICER CALLIN G FOR CERTAIN DETAILS AS REGARDS CLAIM UNDER SECTION 80IB OF THE ACT AND (B) THE COMPLETION CERTIFICATE ISSUED BY THE PRESCRIBED AUTHORI TY IS DATED 12 TH MARCH, 2012 AND THEREFORE, ASSESSING OFFICER INFERR ED THAT THE PROJECT WAS COMPLETED IN THE SUBSEQUENT ASSESSMENT Y EAR AND THEREFORE, EXEMPTION WAS NOT ALLOWABLE DURING THE YEAR UNDER CONSIDERATION. IT IS NOT THE CONTENTION OF THE RES PONDENT- ASSESSEE THAT HE HAD COMPLIED WITH THE NOTICE ISSUED B Y THE ASSESSING OFFICER CALLING THE INFORMATION IN RESPECT OF THE CLAIM UNDER SECTION 80IB OF THE I.T. ACT, THE ONLY CONTENTION OF THE RESPONDENT-ASSESSEE IS THAT SINCE THE CIT(A) HAS EARLI ER GRANTED THE BENEFIT OF THE CLAIM UNDER SECTION 80IB(10), THE SAM E SHOULD BE GRANTED EVEN FOR THE YEAR UNDER CONSIDERATION. HOW EVER, NO EVIDENCE IS FILED TO SHOW THAT THE ASSESSEE HAD COMPLIE D WITH THE NOTICE DATED 11.02.2014 ISSUED BY AO. THE CIT(A) ME RELY FOLLOWING THE ORDER OF THE TRIBUNAL FOR THE A.Y. 2009 -2010 AND 2010-2011 ALLOWED THE CLAIM. 8.1. WE FURTHER NOTE THAT THOUGH THE COMPLETION CERTIFICA TE ISSUED BY THE PRESCRIBED AUTHORITY IS DATED 12 TH MARCH, 2012, THERE WAS NO INFORMATION ON RECORD EVIDENCING THE FACT THAT THE PROJECT WAS COMPLETED WITHIN THE PRESCRIBED PERIOD AN D THE APPLICATION TO THE COMPETENT AUTHORITY FOR ISSUE OF COM PLETION CERTIFICATE WAS MADE WITHIN THE PRESCRIBED TIME. THUS, T HE CIT(A) 5 ITA.NO.1016/HYD/2016 SMT. CHERUKURI SWAPNA, HYDERABAD. WITHOUT PROPERLY LOOKING INTO THE ASPECTS OF COMPLETIO N OF PROJECTION WITHIN THE PRESCRIBED PERIOD AND WHETHER A SSESSEE HAD APPLIED TO THE COMPETENT AUTHORITY WITHIN THE PRESCRIBED PERIOD HAD GRANTED THE RELIEF MERELY PLACING RELIANCE UPON TH E ORDER OF THE TRIBUNAL IN EARLIER YEARS. IN THE EARLIER ASSESSM ENT YEARS THE ISSUE WHETHER THE PROJECT IS COMPLETED WITHIN THE PRESCR IBED PERIOD AND WHEN THE ASSESSEE HAD APPLIED FOR PERMISS ION TO THE COMPETENT AUTHORITY FOR ISSUE OF CERTIFICATE OF COMPLE TION ARE NOT REQUIRED TO BE EXAMINED. AS WE ARE TOLD AT BAR THAT THE PROJECT WAS COMPLETED DURING PREVIOUS YEAR RELATABLE TO THE AS SESSMENT YEAR UNDER CONSIDERATION, THE ISSUE REQUIRE EXAMINATIO N AND THEREFORE, WE REMIT THE MATTER BACK TO THE FILE OF THE ASS ESSING OFFICER TO EXAMINE WHETHER THE ASSESSEE HAS FULFILLED THE ABOVE REQUIREMENTS. WE ORDER ACCORDINGLY. 9. IN THE RESULT, APPEAL OF THE REVENUE IS PARTLY ALLO WED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10.02.2 017. SD/- SD/- (SMT. P. MADHAVI DEVI) (INTURI RAMA RAO) JUDICIAL MEMBER ACCOUNTATN MEMBER HYDERABAD, DATED 10 TH FEBRUARY, 2017 VBP/- 6 ITA.NO.1016/HYD/2016 SMT. CHERUKURI SWAPNA, HYDERABAD. COPY TO 1. DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1( 3), 7 TH FLOOR, ROOM NO.708, AAYAKAR BHAVAN, BAHSEERBAGH, HYDERABAD. 2. SMT. CHERUKURI SWAPNA, PLOT NO.176, ROAD NO.13, J UBILEE HILLS, HYDERABAD. 3. CIT(A)-11, HYDERABAD. 4. PR. CIT (CENTRAL), HYDERABAD. 5. D.R. ITAT B BENCH, HYDERABAD. 6. GUARD FILE