M/S. BAJAJ BHAVAN OWNERS PREMISES CO-OP. HSG SOCIETY LTD, MUMBAI V. THE ITO WD 12(3)(1), MUMBAI

ITA 1298/MUM/2008

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 79302 (ITAT-MUMBAI)
• Duration Of Justice: 6 year(s) 4 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-07-2014
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 07-07-2014
• Assessment Year: 2004-2005
• Appeal Filed On: 21-02-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: M A GOHEL
• Keywords: Tax effect; Condonation of delay

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES B MUMBAI . . , , BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER /AND SHRI SANJAY ARORA, ACCOUNTANT MEMBER ITA NO.1298/MUM/2008, A.Y. 2004-05 BAJAJ BHAVAN OWNERS PREMISES CO- OP. SOCIETY LTD., 220- JAMNALAL BAJAJ ROAD, NARIMAN POINT, MUMBAI 400021. PAN: AAATB 0644H (APPELLANT ) VS. THE ITO WARD 12(3)(1), ROOM NO.102, 1 ST FLOOR, AAYKAR BHAVAN, MK ROAD, MUMBAI 400020 (RESPONDENT) APPELLANT BY : SHRI M.A.GOHEL RESPONDENT BY : SHRI MA URYA PRATAP DATE OF HEARING : 07/07/20 14 DATE OF PRONOUNCEMENT : 07/07/2014 ORDER PER I.P.BANSAL, J.M, THIS IS AN APPEAL FILED BY THE ASSESSEE. IT IS DI RECTED AGAINST ORDER PASSED BY LD. CIT(A)-XII, DATED 12/10/2007 FOR ASSESSMENT YEAR 2004-05. GROUNDS OF APPEAL READ AS UNDER: I. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT (APPEAL) HAS ERRED IN CONFIRMING THE ADDITIONS MADE BY A.O. ON ACCOUNT OF THE FOLLOWING RECEIPTS AS TAXABLE IN THE HANDS OF APPELLANT. A. BETTERMENT CHARGES . 22,67.600.00 B. NON OCCUPANCY CHARGES. 8,47,700.00 31,14,700.00 2. THE LEARNED CIT (APPEALS) HAS ERRED IN CONSIDERI NG THE VIEW THAT THE CONCEPT OF MUTUALITY DOES NOT EXIST IN THE CASE OF RECEIPTS ON ACCOUNT OF BETTERMENT CHARGES & NON OCCUPANCY CHARGES. ITA NO.1298/MUM/2008, A.Y. 2004-05 2 3. THE APPELLANT PRAYS THAT CONCEPT OF MUTUALITY SH ALL BE ACCEPTED AND THUS THE ADDITIONS MADE AS ABOVE SHALL BE DELETED. 4. ON THE FACTS AND IN LAW THE CIT (APPEALS) HAS ER RED IN CONFIRMING WITH A. 0. ON THE TREATMENT OF RENT RECEIVED AMOUNTING TO RS.11,73,02 9/- AS INCOME FROM OTHER SOURCES AS AGAINST INCOME FROM HOUSE PROPERTY AND T HEREBY DENYING THE DEDUCTION U/S 24 OF THE INCOME TAX ACT, 1961. 5. THE APPELLANT PRAYS THAT THE RENT RECEIPTS SHALL BE TREATED AS INCOME FROM HOUSE PROPERTY AND DEDUCTION U/S 24 SHALL BE ALLOWED. 6. THE ORDER PASSED IS BAD IN LAW. 7. WITHOUT PREJUDICE TO THE ABOVE GROUNDS, THE DEDU CTION ALLOWED @ 10 % BY THE CIT (APPEALS) OUT OF RENT RECEIVED IS ON THE LOWER SIDE . 2. IT MAY BE MENTIONED HERE THAT EARLIER THIS APPEA L WAS DISMISSED BY THE TRIBUNAL ON ACCOUNT OF NON-CONDONATION OF DELAY IN FILING THE APPEAL VIDE ORDER DATED 23/7/2009. THE ASSESSEE FILED A WRIT PETITIO N AGAINST THAT ORDER BEFORE HONBLE BOMBAY HIGH COURT WHICH IS NOW DECIDED BY HONBLE BOMBAY HIGH COURT VIDE THEIR ORDER DATED 10/9/2012 IN WRIT PETI TION NO. 1379 OF 2012 AND THE ORDER OF THE TRIBUNAL HAS BEEN SET ASIDE AND THE TR IBUNAL HAS BEEN DIRECTED TO HEAR THE APPEAL FILED BY THE ASSESSEE ON MERITS. IT IS PURSUANCE OF THE SAID ORDER OF HONBLE BOMBAY HIGH COURT THIS APPEAL HAS BEEN FIXED FOR HEARING. 3. AT THE OUTSET IT WAS SUBMITTED BY LD. AR THAT TH E ISSUES RAISED IN THE PRESENT APPEAL ARE IN FAVOUR OF THE ASSESSEE BY T HE EARLIER ORDER OF THE TRIBUNAL AND REFERENCE WAS MADE TO THE FOLLOWING ORDERS: 1. ITA NO.5048/MUM/2004, A.Y. 2001-02, ITA NO.1433 /MUM/2007, A.Y. 2002-03, ITA NO.1434/MUM/2007, A.Y. 2003-04 & ITA NO.4604/MUM/2004, A.Y. 2001-02 FOR A.Y. 2001-02. O RDER DATED 04/11/2009 IN THE CASE OF BAJAJ BHAVAN OWNERS PREM ISES CO-OP. SOCIETY LTD. 2. ITA NO.8067/MUM/2011, A.Y. 2007-08 ORDER DATED 18/04/2013 IN THE CASE OF BAJAJ BHAVAN OWNERS PREMISES C.S.L, ITA NO.1298/MUM/2008, A.Y. 2004-05 3 3. ITA NO.8698/MUM/2010, A.Y. 1993-94 ORDER DATED 22.01.2013 IN THE CASE OF BAJAJ BHAVAN OWNERS PREMISES CO-OP. SOCIETY LTD., IT WAS FURTHER SUBMITTED THAT THE ORDER OF THE TRIB UNAL DATED 4/11/2009 IN RESPECT OF ASSESSMENT YEAR 2002-03 AND 2003-04 HAVE BEEN CONFIRMED BY HONBLE BOMBAY HIGH COURT, COPY OF THESE ORDERS ARE ALSO FI LED IN THE PAPER BOOK AS UNDER: 1. DECISION DATED 16/08/2011 IN INCOME TAX APPE AL NO. 3182 OF 2010 IN THE CASE OF M/S. BAJAJ BHAWAN OWNERS PREMISES CO-OP . SOCIETY LTD., FOR A.Y. 2002-03. 2. DECISION DATED 16/08/2011 IN INCOME TAX APPE AL NO. 3183 OF 2010 IN THE CASE OF M/S. BAJAJ BHAWAN OWNERS PREMISES CO-OP . SOCIETY LTD., FOR A.Y. 2003-04. THUS, IT WAS PLEADED BY LD. AR THAT THE ISSUES RAIS ED BY THE ASSESSEE IN THE PRESENT APPEAL ARE COVERED IN FAVOUR OF THE ASSESSE E. 4. ON THE OTHER HAND, LD. DR DID NOT CONTROVERT TO THE SUBMISSIONS MADE BY LD. AR. 5. IN THIS VIEW OF THE POSITION, WE PROCEED TO DEC IDE THE GROUNDS OF APPEAL. AS IT CAN BE SEEN FROM THE GROUNDS OF APPEAL THAT THE GRIEVANCE OF THE ASSESSEE IS REGARDING FOLLOWING AMOUNTS: 1. BETTERMENT CHARGES --- RS. 22,67,600/- 2. NON-OCCUPANCY CHARGES -- - RS. 8,47,700/- 3. RENT OF RS. 11,73,029/- IN RESPECT OF TERRACE, WHICH IS TREATED TO BE INCOME FROM OTHER SOURCES AS AGAINST HOUSE PROPERTY INCOME CLAIMED BY THE ASSESSEE. 4.1 ALL THESE DELETIONS BY THE TRIBUNAL IN RESPECT OF ASSESSMENT YEAR 2002-03 WERE CHALLENGED BY THE REVENUE BEFORE HONBLE HIGH COURT IN INCOME TAX APPEAL ITA NO.1298/MUM/2008, A.Y. 2004-05 4 NO.3182 OF 2010 AND HONBLE BOMBAY HIGH COURT VIDE THEIR ORDER DATED 16/8/2011 HAVE DECIDED ALL THESE ISSUES WITH THE FO LLOWING OBSERVATIONS: 1. THREE QUESTIONS OF LAW ARE RAISED BY THE REVEN UE IN THIS APPEAL, WHICH READ THUS: (A) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE TRIBUNAL WAS RIGHT IN DIRECTING THE ASSESSING OFFIC ER TO DELETE THE ADDITION OF RS.8,25,833/- ON ACCOUNT OF NON OCCUPANCY CHARGES H OLDING THAT THE SAID AMOUNT WERE RECEIVED FROM MEMBERS AND NOT FROM OCCU PANTS AND THEREFORE THE PRINCIPLE OF MUTUALITY WAS APPLICABLE. (B) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE TRIBUNAL WAS RIGHT IN DIRECTING THE ASSESSING OFFIC ER TO DELETE THE ADDITION OF RS.25,20,750/- ON ACCOUNT OF TRANSFER FEES / BETT ERMENT CHARGES ON THE GROUND OF PRINCIPLE OF MUTUALITY? (C) WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAW, THE TRIBUNAL WAS RIGHT IN DIRECTING THE ASSESSING OFFIC ER TO ASSESS THE RENTAL INCOME OF RS.5,93,700/- FOR LETTING OUT THE TERRACE UNDER THE HEAD INCOME FROM HOUSE PROPERTY SUBJECT TO DEDUCTION U/S. 24? 2. AS REGARDS QUESTIONS (A) & (B) ARE CONCERNED, C OUNSEL FOR THE REVENUE STATES THAT THE SAID QUESTIONS ARE ANSWERED IN FAVOUR OF THE AS SESSEE AND AGAINST THE REVENUE BY THIS COURT IN THE CASE OF SIND CO-OPERATIVE HOUS ING SOCIETY VS. ITO REPORTED IN (2009) 317 ITR 47 AND MITTAL COURT PREMISES CO-OP. SOCIETY LTD. VS. ITO REPORTED IN (2010) 320 ITR 414 (BOM). THEREFORE, QUESTIONS (A) & (B) CANNOT BE ENTERTAINED. 3. AS REGARDS QUESTION (C) IS CONCERNED, COUNSEL F OR THE REVENUE STATES THAT THE ITAT HAS ALLOWED THE CLAIM OF THE ASSESSEE BY FOLLOWING ITS DECISIONS IN THE CASE OF SHARDA CHAMBER PREMISES VS. ITO AND ITO VS. CUFFEE PARADE SAINARA PREMISES CO- OPERATIVE SOCIETY LTD. COUNSEL FOR THE REVENUE FAIR LY STATES THAT THE APPEALS AGAINST THE SAID DECISIONS HAVE NOT BEEN FILED BY THE REVE NUE IN VIEW OF THE SMALLNESS OF THE TAX EFFECT. HOWEVER, THE COUNSEL FOR THE REVENUE I S NOT IN A POSITION TO POINT OUT ANY ERROR IN THE ORDERS PASSED BY THE ITAT. IN THIS VI EW OF THE MATTER, WE SEE NO REASON TO ENTERTAIN THE APPEAL ON QUESTION(C). IN THE RE SULT, THE APPEAL IS DISMISSED WITH NO ORDER AS TO COSTS.: THEREFORE, ALL THESE ISSUES ARE COVERED IN FAVOUR O F THE ASSESSEE BY THE EARLIER ORDERS OF THE TRIBUNAL AS WELL AS ORDER PASSED BY H ONBLE HIGH COURT. SIMILAR ORDER IS ALSO PASSED BY HONBLE HIGH COURT IN RESPE CT OF ASSESSMENT YEAR 2003- 04. RESPECTFULLY FOLLOWING THE AFOREMENTIONED DECI SION OF HONBLE BOMBAY HIGH COURT, WHEREBY APPEALS FILED BY THE REVENUE HAVE B EEN DISMISSED BY HONBLE ITA NO.1298/MUM/2008, A.Y. 2004-05 5 HIGH COURT APPROVING ORDER OF THE TRIBUNAL, WE DE CIDE ALL THE ISSUES RAISED IN THE PRESENT APPEAL IN FAVOUR OF THE ASSESSEE AND AP PEAL FILED BY THE ASSESSEE IS ALLOWED. 6. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 07/07/2014 ! ' #$ % &'( 07/07/2014 ' ) SD/- SD/- ( /SANJAY ARORA ) ( . . / I.P. BANSAL ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI; &' DATED 07/07/2014 ! ! ! ! ' '' ' *+, *+, *+, *+, -,$+ -,$+ -,$+ -,$+ / COPY OF THE ORDER FORWARDED TO : 1. ./ / THE APPELLANT 2. *0./ / THE RESPONDENT. 3. 1 ( ) / THE CIT(A)- 4. 1 / CIT 5. ,2) *+' , , / DR, ITAT, MUMBAI 6. )3 4 / GUARD FILE. !' !' !' !' / BY ORDER, 0,+ *+ //TRUE COPY// 5 55 5 / 6 6 6 6 (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI . ' . ./ VM , SR. PS