Indiabuild Villas Development Private Limited , Bangalore V. Deputy Commissioner of Income Tax Circle-3(1)(1), Bangalore

ITA 1270/BANG/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 5609 (ITAT-BANGALORE)
• Duration Of Justice: 7 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-01-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2012-2013
• Appeal Filed On: 07-06-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR G MANOJ KUMAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH SMC A, BANGALORE BEFORE SHRI A.K.GARODIA, ACCOUNANT MEMBER ITA NO.1270 (BANG) 2017 (ASSESSMENT YEAR : 2012 13) M/S. INDIABUILD VILLAS DEVELOPMENT PVT. LTD., NO. 6/A 2 ND FLOOR, KABRA EXCELSIOR, 7 TH CROSS, 1 ST BLOCK, KORAMANGALA, BANGALORE 560034. PAN. AACCI3931K APPELLANT VS THE DCIT, CIRCLE 3 (1) (1), BANGALORE. RESPONDENT ASSESSEE BY : SHRI SIDDESH GADDI, C. A. REVENUE BY : DR. G. MANOJ KUMAR, ADDL. CIT DR DATE OF HEARING : 09-01-2018 DATE OF PRONOUNCEMENT : 11-01-2018 O R D E R PER A. K. GARODIA, A.M.: THIS APPEAL IS FILED BY THE ASSESSEE WHICH IS DIREC TED AGAINST THE ORDER OF CIT (A) 3 BANGALORE DATED 31.03.2017 FOR A. Y. 2012 13. 2. THE ASSESSEE HAS RAISED THREE GROUNDS AS PER REV ISED GROUNDS OF APPEAL. THE NATURE OF EXPENSES ARE THREE I.E. ADVERTISEMENT EXP ENDITURE RS. 15.65 LACS, 2) LEGAL & PROFESSIONAL FEES RS. 14.80 LACS AND 3) SIT E ADMINISTRATIVE EXPENDITURE RS. 11,84,600/- BUT THE FINDING OF THE LEARNED CIT (A) IS COMMON THAT ALL THESE EXPENSES ARE TO BE CAPITALIZED TO IN VENTORY AS PER AS 2 ON INVENTORY READ WITH SECTION 145A OF I T ACT. 3. LEARNED AR OF THE ASSESSEE THAT THE ARGUMENTS OF THE ASSESSEE BEFORE CIT (A) ON THIS ACCOUNT ARE NOTED BY CIT (A) ON PAGE 5 OF H IS ORDER BUT THIS ASPECT OF THE MATTER WAS DECIDED BY HIM AS PER PARA 9.3 OF HI S ORDER IN A CRYPTIC MANNER WITHOUT ANY FINDING IN RESPECT OF APPLICABILITY OF CLAUSES (C) AND (D) OF PARA 13 OF AS 2, COPY AVAILABLE ON PAGE 104 OF THE PAPER BOO K. LEARNED DR OF THE REVENUE SUPPORTED THE ORDERS OF THE AUTHORITIES BEL OW. ITA NO. 1270(BANG)2017 2 4. I HAVE CONSIDERED THE RIVAL SUBMISSIONS. I FIND THAT AS PER PARA 13 OF AS 2, ADMINISTRATIVE OVERHEADS THAT DO NOT CONTRIBUTE TO BRINGING THE INVENTORIES TO THEIR PRESENT LOCATION AND CONDITION AND SELLING AN D DISTRIBUTION COSTS ARE TO BE EXCLUDED FROM THE COST OF INVENTORIES. AS PER THE L EARNED AR OF THE ASSESSEE, THE AMOUNT IN DISPUTE OF RS. 15.65 LACS & RS. 14.80 LACS ARE HIT BY THE CLAUSE (D) OF PARA 13 OF AS 2 AND THE REMAINING AMOUNT O F RS. 11,84,600/- IS HIT BY THE CLAUSE (C) OF PARA 13 OF AS 2. THESE CONTENTI ONS WERE RAISED BEFORE CIT (A) ALSO AND WERE NOTED BY CIT (A) ON PAGE 5 OF HIS ORDER BUT WHILE DECIDING THE ISSUE AS PER PARA 9.3 OF HIS ORDER, LEARNED CIT (A) HAS DECIDED THE ISSUE WITHOUT EXAMINING AND DECIDING THE APPLICABILITY OF CLAUSES (C) AND (D) OF PARA 13 OF AS 2. HENCE, I SET ASIDE THE ORDER OF CIT ( A) ON THIS ISSUE AND RESTORE THE MATTER BACK TO HIS FILE FOR A FRESH DECISION BY WAY OF A SPEAKING AND REASONED ORDER IN RESPECT OF APPLICABILITY OF CLAUS ES (C) AND (D) OF PARA 13 OF AS 2 AFTER PROVIDING ADEQUATE OPPORTUNITY OF BEING H EARD TO BOTH SIDES. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- (A.K. GARODIA) ACCOUNTANT MEMBER BANGALORE: D A T E D : 11.01.2018 /MS/ COPY TO: 1. APP ELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.