Anjali Foundations, CHENNAI V. ITO, CHENNAI

ITA 1211/CHNY/2017

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 4220 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 4 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-10-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 15-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S BHARATH
• Assessee Lawyers: S SRIDHAR
• Keywords: Difference of opinion; Change of opinion

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH : CHENNAI . , ! '# $ , BEFORE SHRI ABRAHAM P GEORGE, ACCOUNTANT MEMBER AND SHRI GEORGE MATHAN, JUDICIAL MEMBER ./ I.T.A.NO.1211/CHNY/2017 / ASSESSMENT YEAR : 2009-10 M/S.ANJALI FOUNDATIONS , 25,BARNABY ROAD,KILPAUK, CHENNAI 600 010. VS. THE INCOME TAX OFFICER, NON-CORPORATE WARD-10(1), CHENNAI. [PAN AANFA 8459 L] ( $% / APPELLANT) ( &'$% /RESPONDENT) / APPELLANT BY : MR.S.SRIDHAR,ADVOCATE /RESPONDENT BY : MR.S.BHARATH,CIT,D.R ! ' #$% / DATE OF HEARING : 26 - 0 9 - 201 8 &' #$% / DATE OF PRONOUNCEMENT : 08 - 1 0 - 201 8 ( / O R D E R PER GEORGE MATHAN , JUDICIAL MEMBER THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST THE ORDER PASSED U/S.263 OF THE INCOME TAX ACT, 1961, BY THE PRINCIPAL COMMISSIONER OF INCOME-TAX-3, CHENNAI IN C. NO.3033 /263/PCIT- 3/2016-17, DATED 29.03.2017 FOR THE ASSESSMENT YEAR 2009-10. ITA NO.1211/CHNY/2017 :- 2 -: 2. MR.S.SRIDHAR REPRESENTED ON BEHALF OF THE ASSESSEE, AND MR.S.BHARATH REPRESENTED ON BEHALF OF THE REVENUE. 3. IT WAS SUBMITTED BY THE LD.AR THAT THE ASSESSEE IS A PARTNERSHIP FIRM, WHICH IS DOING BUSINESS OF REAL E STATE AND CONSTRUCTION. IT WAS A SUBMISSION THAT ASSESSEE HAD FILED ITS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR ON 08.09.20 09 ADMITTING NIL INCOME AFTER CLAIMING DEDUCTION U/S.80-IB OF THE ACT. IT WAS A SUBMISSION THAT THE ASSESSMENT U/S.143(3) OF THE AC T WAS ORIGINALLY COMPLETED ON 29.12.2011, WHICH WAS SUBJECT TO A REV ISION U/S.263 OF THE ACT VIDE ORDER DATED 28.03.2014 WHEREIN THE COM MISSIONER OF INCOME TAX-III CHENNAI HAD DIRECTED THE LD. ASSESSI NG OFFICER TO COMPLETE THE FRESH ASSESSMENT IN ACCORDANCE WITH LA W AFTER OBTAINING AND EXAMINING ALL DOCUMENTS AND RECORDS RELATING TO THE CLAIM OF DEDUCTION U/S.80-IB OF THE ACT INCLUDING THOSE MATE RIALS, WHICH HAVE BEEN CALLED FOR DURING THE COURSE OF REGULAR SCRUTI NY ASSESSMENT PROCEEDINGS FROM THE ASSESSEE AS WELL AS FROM M/S.N ARENDRA PROPERTIES LTD. THE ASSESSMENT ORDER GIVING EFFEC T TO THE REVISION PASSED U/S.263 OF THE ACT WAS PASSED U/S.143(3) R.W .S 263 OF THE ACT ON 30.03.2015 WHEREIN AFTER EXAMINING CALLED DOCUME NTS ON RECORDS RELATING TO THE CLAIM OF DEDUCTION U/S.80-IB(10) OF THE ACT. IT WAS A SUBMISSION THAT SUBSEQUENTLY A NOTICE U/S.263 OF TH E ACT DATED ITA NO.1211/CHNY/2017 :- 3 -: 07.11.2016 CAME TO BE ISSUED ON THE ASSESSEE, AGAIN QUESTIONING THE DEDUCTION GRANTED TO THE ASSESSEE U/S.80-IB OF THE ACT. IT WAS A SUBMISSION THAT THE IN RESPONSE TO THE NOTICE DT.7. 11.2016, ASSESSEE HAD REPLIED THAT THE ISSUE U/S.80-IB(10) OF THE ACT HAS BEEN EXAMINED BY THE LD. ASSESSING OFFICER, FIRST IN THE ORIGINAL ASSESSMENT PASSED U/S.143(3) OF THE ACT ON 29.12.2011, AND SECOND TIM E, THE ORDER PASSED U/S.143(3) R.W.S.263 OF THE ACT DATED 30.03. 2015,ON ACCOUNT OF REVISION ORDER PASSED U/S.263 OF THE ACT, BY THE CO MMISSIONER OF INCOME TAX, AND ALL THE ISSUES HAVING BEEN CONSIDER ED BY THE LD. ASSESSING OFFICER, SEC.263 PROPOSAL WAS CLEARLY BAS ED ON CHANGE OF OPINION AND WAS NOT PERMISSIBLE. THE REPLY OF THE A SSESSEE WAS NOT CONSIDERED BY THE LD. COMMISSIONER OF INCOME TAX. I T WAS A SUBMISSION THAT LD. COMMISSIONER OF INCOME TAX AGAI N DIRECTED FRESH RE-ASSESSMENT BY SETTING ASIDE ORDER PASSED U/S.14 3(3) R.W.S.263 OF THE ACT DATED 30.03.2015. IT WAS A SUBMISSION THAT THE REVISION U/S.263 AS PROPOSED BY THE COMMISSIONER OF INCOME T AX, CHENNAI, WAS CLEARLY ON THE BASIS OF A CHANGE OF OPINION AND RE-APPRAISAL OF THE SAME FACTS, WHICH HAD BEEN CONSIDERED BY THE LD. AS SESSING OFFICER ON TWO SEPARATE OCCASIONS, OF WHICH ONE WAS ON ACCOUNT OF REVISION U/S.263 ON IDENTICAL ISSUES, REVISION ORDER PASSED U/S.263 OF THE ACT IS LIABLE TO BE QUASHED. ITA NO.1211/CHNY/2017 :- 4 -: 4. IN REPLY, THE LD.D.R VEHEMENTLY SUPPORTED THE O RDER OF THE PRINCIPAL COMMISSIONER OF INCOME TAX, CHENNAI-5. I T WAS A SUBMISSION THAT PRINCIPAL COMMISSIONER OF INCOME TA X HAD THE POWERS TO REVISE ANY ORDER U/S.263 OF THE ACT, IF THE SAME WAS FOUND TO BE ERRONEOUS AND PREJUDICIAL TO THE INTERESTS OF THE R EVENUE. IT WAS A PRAYER THAT THE ORDER OF THE PRINCIPAL COMMISSIONER OF INCOME TAX WAS LIABLE TO BE SUSTAINED. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. AT T HE OUTSET, IT IS TO BE APPRECIATED THAT THE ORDER OF ASSESSMENT C AN BE REVISED WHEN BOTH THE CONDITIONS ARE MET, FIRST BEING THE ORDER IS ERRONEOUS, AND THE SECOND BEING THE ORDER IS PREJUDICIAL TO THE INTERE STS OF THE REVENUE. THE VIEW OF THE REVENUE SEEMS TO BE ANY ORDER GRANT ING DEDUCTION TO AN ASSESSEE IS PREJUDICIAL TO THE INTERESTS OF THE REVENUE. WE ARE NOT IN AGREEMENT WITH THIS VIEW, IN SO FAR AS, IF THE A CT PROVIDES FOR GRANTING A PARTICULAR BENEFIT OR DEDUCTION TO AN AS SESSEE, THE GRANTING OF SUCH DEDUCTION OR BENEFIT TO THE ASSESSEE CANNOT BE DEEMED AS PREJUDICIAL TO THE INTEREST OF THE REVENUE. ONE HAS TO TAKE OUT OF ONES MIND THAT THE GRANTING OF STATUTORY DEDUCTION IS AN ERRONEOUS ORDER PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THE I SSUE OF THE ORDER BEING ERRONEOUS HOWEVER NEEDS TO BE SHOWN. JUST A C LAIM THAT THE ITA NO.1211/CHNY/2017 :- 5 -: ORDER IS AN ERRONEOUS WOULD NOT MAKE AN ORDER ERRON EOUS. WHAT IS THE ERROR WOULD HAVE TO BE SPECIFICALLY POINTED OUT . IN THE PRESENT CASE, THE PRINCIPAL COMMISSIONER OF INCOME TAX HAS RAISED THE ISSUES THAT THE CLAIM OF DEDUCTION U/S.80-IB(10) HAS BEEN MADE BY BOTH THE LAND OWNER, BEING THE ASSESSEE HEREIN AND THE JOINT VENTURE PARTNER, BEING M/S.NARENDRA PROPERTIES LTD. THE ASSESSEE HAS CATEGORICALLY BROUGHT TO THE ATTENTION OF THE PRINCIPAL COMMISSIO NER OF INCOME TAX, IN RESPONSE TO SHOW-CAUSE NOTICE THAT THE DECISION OF THE TRIBUNAL VIDE ORDER DATED 22.11.2012 IN THE CASE OF SRILAKSHMI BR ICK INDUSTRIES HAS DEALT WITH THIS ISSUE PROPOSED IN THE REVISION ORDE R AND THE BENCH HAS CATEGORICALLY CONCLUDED IN PARAS 9 & 10 THAT THE LA ND OWNER UNDER SIMILAR CIRCUMSTANCES WOULD BE ENTITLED FOR THE BEN EFIT OF DEDUCTION U/S.80-IB(10) OF THE ACT IN THE COMPUTATION OF THE TAXABLE TOTAL INCOME. THIS VIEW HAS BEEN CLEARLY EXPRESSED BY TH E APPELLATE AUTHORITY AND THE LD. ASSESSING OFFICER HAS IN THE COURSE OF ASSESSMENT FOLLOWED SUCH VIEW EXPRESSED BY THE APPELLATE AUTHO RITY, WHEN GRANTING THE ASSESSEE BENEFIT OF DEDUCTION U/S.80-I B OF THE ACT. THUS CLEARLY THE REVISION AS DONE BY THE COMMISSIONER OF INCOME TAX U/S.263 OF THE ACT IS BASED EXCLUSIVELY ON CHANGE O F OPINION, WHICH IS NOT PERMISSIBLE, WHEN PASSING A REVISION U/S.263 OF THE ACT. THE ORDER U/S.263 OF THE ACT IS BASED PURELY ON CHANGE OF OPI NION AND THE SAME BEING IMPERMISSIBLE UNDER THE PROVISIONS OF THE SEC TION 263, THE ORDER ITA NO.1211/CHNY/2017 :- 6 -: DATED 29/03/2017 PASSED BY THE PRINCIPAL COMMISSION ER OF INCOME TAX U/S.263 OF THE ACT IN THE CASE OF THE ASSESSEE HEREIN STANDS QUASHED. 6. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS A LLOWED. ORDER PRONOUNCED ON 08 TH OCTOBER, 2018, AT CHENNAI. SD/ - SD/ - ( () . +,+ ) ( ABRAHAM P GEORGE) ! / ACCOUNTANT MEMBER ( $ ) (GEORGE MATHAN) ) ! / JUDICIAL MEMBER . ' / CHENNAI / / DATED: 08 TH OCTOBER, 2018. K S SUNDARAM 0 #12 3 2# / COPY TO: 1 . / APPELLANT 3. ! 4# () / CIT(A) 5. 267 #8 / DR 2. / RESPONDENT 4. ! 4# / CIT 6. 79 :' / GF