Income-tax Officer, V. M/s. Kumar Beharay Rathi, Pune

ITA 1504/PUN/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2724 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 6 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 25-07-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: HITENDRA NINAWE
• Section: 80IB

Judgement Text

] ]] ] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE ! ' , # $ BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM ITA NO.1504/PN/2014 ASSESSMENT YEAR : 2010-11 THE INCOME TAX OFFICER, WARD 4(5), PUNE. .. APPELLANT VS. M/S KUMAR BEHARAY RATHI, 2413, KUMAR CAPITAL, 2 ND FLOOR, EAST STREET, CAMP, PUNE 411 001. PAN: AAAFK6677K ... RESPONDENT / DEPARTMENT BY : SHRI HITENDRA NINAWE / APPELLANT BY : SHRI NIKHIL PATHAK / DATE OF HEARING : 09.02.2016 / DATE OF PRONOUNCEMENT: 12.02.2016 % / ORDER PER VIKAS AWASTHY, JM : THIS APPEAL HAS BEEN FILED BY THE REVENUE AGAINST T HE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS)-II, PUNE DATED 30.04.2014 FOR THE ASSESSMENT YEAR 2010-11. 2. THE REVENUE HAS ASSAILED THE ORDER OF THE CIT(A) ON THE FOLLOWING GROUNDS : 1) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS ) ERRED IN ALLOWING ASSESSEE'S CLAIM OF DEDUCTION OF RS.3,45,99,474/- U /S.80IB(10) OF THE I.T.ACT, 1961. 2) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN HOLDING THAT THE PROJECT 'KUBERA SANKUL' WAS AN INDEPENDENT PROJECT AND NOT AN EXTENDED PART OF THE PROJECT 'KUBERA VIHAR' COMMENCED IN 1992. 3) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN NOT 2 ITA NO.1504/PN/2014 APPRECIATING THAT THE BENEFIT OF DEDUCTION U/S.80IB (10) CANNOT BE EXTENDED TO A HOUSING PROJECT CONCEIVED, PLANNED AND APPROVED BEF ORE 01.10.1998 WHEREAS THE IMPUGNED PROJECT HAD BEEN CONCEIVED PRIOR TO 01.10. 1998 AND ALSO NO DEVELOPMENT TOOK PLACE IN CONNECTION WITH THE APPRO VAL GIVEN BY THE PMC VIDE CERTIFICATE NO.1486 DATED 23.01.2004. 4) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN FAILING TO APPRECIATE THAT AS WOULD BE EVIDENT FROM THE PLAN D ATED 30.03.2007, THE IMPUGNED PROJECT WAS A MIXED PROJECT AND NOT A HOUS ING PROJECT. 5) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN HOLDING THAT THE SO CALLED 'KUBER SANKUL PHASE-II' CONSISTING OF FOU R BUILDING WAS A DIFFERENT PROJECT THEN 'KUBERA SANKUL PHASE-I' IGNORING THE F ACT THAT AS PER THE APPROVAL DATED 2.01.2004, THE ENTIRE 'KUBERA SANKUL ' HAD 11 BUILDINGS WHICH SHOULD HAVE BEEN COMPLETED BY 31.03.2008. 6) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN NOT APPRECIATING THAT THE PROJECT CONSISTED OF COMMERCI AL AREA EXCEEDING 5000 SQ.FT. AND, THEREFORE, DID NOT SATISFY THE CONDITION LAID DOWN IN SECTION 80IB(10)(D) OF THE ACT FOR ALLOWANCE OF CLAIM U/S.80IB(10). 7) THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEN D ANY OR ALL THE GROUND OF APPEAL. 3. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RE CORDS ARE: THE ASSESSEE FIRM IS ENGAGED IN THE BUSINESS OF DEVELOPMENT AND CONSTRUCTION OF HOUSING PROJECTS. THE ASSESSEE FILED ITS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR ON 27.09.2010 DECLARING TOTAL INCOME AS NIL. THE CASE OF THE ASSESSEE WAS SELECTED FOR SCRUTINY, ACCORDINGLY NOTICE UNDER SEC TION 143(2) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) WAS ISSUED TO THE AS SESSEE ON 05.09.2011. DURING THE COURSE OF SCRUTINY ASSESSMENT, THE ASSESSING OF FICER OBSERVED THAT THE ASSESSEE HAS TOTAL INCOME OF RS.3,46,29,580/- AND T HE ASSESSEE HAS CLAIMED DEDUCTION UNDER SECTION 80IB(10) OF THE ACT TO THE TUNE OF RS.3,45,99,474/- IN RESPECT OF ITS HOUSING PROJECT KUBERA SANKUL. TH E ASSESSING OFFICER VIDE ASSESSMENT ORDER DATED 28.03.2013 DISALLOWED THE CL AIM OF DEDUCTION UNDER SECTION 80IB(10) CLAIMED BY THE ASSESSEE IN RESPECT OF HOUSING PROJECT KUBERA SANKUL. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PR EFERRED AN APPEAL BEFORE THE CIT(A). 3 ITA NO.1504/PN/2014 4. THE CIT(A) BY PLACING RELIANCE ON THE EARLIER OR DERS PASSED BY CIT(A) IN THE ASSESSMENT YEARS 2006-07, 2007-08 AND 2009-10 ACCEP TED THE APPEAL OF THE ASSESSEE AND ALLOWED CLAIM OF DEDUCTION UNDER SECTI ON 80IB(10) OF THE ACT. THE CIT(A) OBSERVED THAT THE FACTUAL MATRIX OF THE CASE IN IMPUGNED ASSESSMENT YEAR IS PARI-MATERIA WITH THE FACTS IN THE EARLIER ASSESSMENT YEARS. AGAINST THOSE FINDINGS OF THE CIT(A), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 5. SHRI NIKHIL PATHAK APPEARING ON BEHALF OF THE AS SESSEE SUBMITTED AT THE OUTSET THAT THE GROUNDS RAISED IN THE PRESENT APPEA L ARE IDENTICAL TO THE GROUNDS RAISED BY THE REVENUE IN ITA NO.2346/PN/2012 FOR TH E ASSESSMENT YEAR 2009-10. THE TRIBUNAL DISMISSED THE AFORESAID APPEAL OF THE DEPARTMENT VIDE ORDER DATED 28.08.2014. THE LD. AR FURNISHED A COPY OF ORDER O F THE TRIBUNAL IN THE AFORESAID APPEAL. THE LD. AR PRAYED FOR DISMISSING THE APPEA L OF THE REVENUE IN THE LIGHT OF THE ORDER OF CO-ORDINATE BENCH IN ASSESSEES OWN CA SE FOR THE ASSESSMENT YEAR 2009-10. 6. SHRI HITENDRA NINAWE REPRESENTING THE DEPARTMENT VEHEMENTLY SUPPORTED THE FINDINGS OF THE ASSESSING OFFICER. HOWEVER, WH EN CONFRONTED WITH THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASSESSM ENT YEAR 2009-10, THE LD. DR FAIRLY ADMITTED THAT THE ISSUES RAISED IN THE PRESE NT APPEAL ARE SIMILAR TO THE ISSUES RAISED BY THE REVENUE IN THE APPEAL IN ITA NO.2346/ PN/2012 (SUPRA). 7. BOTH SIDES HEARD, ORDERS OF THE AUTHORITIES BELO W PERUSED. IT IS AN ADMITTED FACT THAT THE GROUNDS RAISED BY THE REVENUE IN THE PRESENT APPEAL ARE ON SIMILAR LINES AS WERE RAISED IN ITA NO.2346/PN/2012 FOR THE ASSESSMENT YEAR 2009-10 (SUPRA). THE CO-ORDINATE BENCH OF THE TRIBUNAL DIS MISSED THE AFORESAID APPEAL OF THE REVENUE WITH THE FOLLOWING OBSERVATIONS :- 4 ITA NO.1504/PN/2014 3. THE LD. COUNSEL SUBMITS THAT THE A.Y. 2006-07 WA S THE FIRST ASSESSMENT YEAR IN WHICH THE ASSESSEE HAS CLAIMED THE DEDUCTIO N U/S. 80IB(10). HE SUBMITS THAT THE A.Y. 2009-10 WHICH IS A PRESENT ASSESSMENT YEAR THE ASSESSEE HAS CLAIMED THE DEDUCTION U/S. 80IB(10) IN RESPECT OF T HE SAME HOUSING PROJECT I.E. KUBERA SANKUL AND NOW THE ISSUE HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE. THE LD. COUNSEL FILED THE COPY OF THE TRIBUNAL ORDE R IN ITA NO. 639/PN/2011 AND ITA NO. 373/PN/2012 ORDER DATED 26-05-2014. THE LD . DR WAS FAIR UP TO SUBMITS THAT AT LEAST AT THE TRIBUNAL LEVEL THE ISSUE IS DE CIDED IN FAVOUR OF THE ASSESSEE. WE FIND THAT IN THE A.YS. 2006-07 AND 2007-08 THE REVE NUE HAS CARRIED THE ISSUE BEFORE THE TRIBUNAL BY CHALLENGING THE ORDERS OF TH E LD. CIT(A) IN ITA NO. 639/PN/2011 AND ITA NO. 373/PN/2012. THE TRIBUNAL CONFIRMED THE ORDER OF THE LD. CIT(A) ALLOWING THE DEDUCTION TO THE ASSESSEE. THE OPERATIVE PART OF THE ORDER OF THE TRIBUNAL IS AS UNDER: 7. WE HAVE HEARD THE RIVAL SUBMISSIONS OF THE PARTI ES AND PERUSED THE RECORD. THE LD. COUNSEL SUBMITS THAT THE FIRST PRO JECT OF THE ASSESSEE IS KUBERA VIHAR. THE ASSESSEE ACQUIRED THE LAND IN S. NO. 224/226A AT HADAPSAR, PUNE ADMEASURING 34,900 SQ. MTRS. ON 10-1 1-1987. THE ASSESSEE STARTED THE HOUSING PROJECT UNDER THE NAME KUBERA VIHAR CONSISTING OF BUILDINGS A2, A3, B1 AND B2 VIDE CC N O. 1620 DATED 03-04- 1992 AND SAME WAS COMPLETED VIDE CC NO. 562 DATED 1 1-07-2003. THE ASSESSEE STARTED THE ANOTHER HOUSING PROJECT KUBER A SANKUL, PUNE PHASE- I WHICH WAS COMMENCED ON 24-07-2004 VIDE CC NO. 148 6 WHICH CONSISTED OF FOUR BUILDINGS I.E. A (ASHOK), B (BAKUL), C (CHA MPA) AND A-1 (DEVDHAR). IT ALSO SHOWN IN ITS LAY OUT BUILDING C-1 AND IN T HE LAY OUT PLAN THE ASSESSEE SHOWN THE BUILDINGS OF THE KUBERA VIHAR HAS BEEN COMPLETED. IN THE KUBERA SANKUL, PHASE-I THE FOUR BUILDINGS I.E. A, B, C AND A-1 WERE COMPLETED ON 09-09-2005 VIDE CC NO. 2981. THE ASSE SSEE GOT APPROVAL OF KUBERA SANKUL, PHASE-II VIDE CC NO. 4024 DATED 27 -01-2005 WHICH CONSISTED OF FOUR BUILDINGS I.E. D (GULMOHAR), D1 ( KANCHAN), D-2 (NILGIRI) AND D-3 (PARIJAT) AND THOSE BUILDINGS WERE ALSO COMPLET ED ON 28-04-2008 VIDE CC NO. 1916. HE ARGUES THAT KUBERA SANKUL IS AN INDEPENDENT PROJECT AND THE SAME WAS UNDERTAKEN AFTER 01-10-1998 I.E. T HE JANUARY, 2004 AND THE ASSESSING OFFICER MISINTERPRETED THE LAY OUT PL AN EVEN IF IN THE SAID LAY OUT PLAN THE BUILDINGS OF KUBERA VIHAR HAVE BEEN SHOWN AS COMPLETED. HE SUBMITS THAT THERE WERE TWO SEPARATE PHASE OF THE KUBERA SANKUL AND BOTH THE PHASES INDEPENDENTLY QUALIFY FOR DEDUCTION U/S. 80IB(10) OF THE ACT. HE SUBMITS THAT WHERE THE BUILDINGS PLAN WERE APPROVED BEFORE 01-04-2004, THE DATE OF COMPLETION AS PER SEC. 80IB(10) WAS 31-03-2 008 BUT IN THE CASE OF KUBERA SANKUL THE BUILDING PLANS WERE FIRST MENTI ONED ON 23-01-2004 VIDE CC NO. 1486 AND THOSE PROJECTS WERE COMPLETED ON 28 -02-2008. HE SUBMITS THAT IN THE LAY OUT PLAN SOME OTHER BUILDIN GS I.E. C-1(CHINAR), D-1 (SHIRISH) AND C-2 (CHANDAN) WERE SHOWN AS PARKING W HICH IS ALSO MISINTERPRETED BY THE ASSESSING OFFICER. THE CC FO R THOSE BUILDINGS WERE OBTAINED ON 30-03-2007 VIDE CC NO. 4792 AND THOSE T HREE BUILDINGS DO NOT FORM PART OF THE KUBERA SANKUL. HE SUBMITS THAT THE ASSESSING OFFICER HAS NOT APPRECIATED THE CORRECT FACTS EVEN IF ALL THE D OCUMENTS WERE PLACED BEFORE HIM. 8. PER CONTRA, THE LD. DR SUBMITS THAT ADMITTEDLY T HE ASSESSEE STARTED THE HOUSING PROJECT MUCH PRIOR TO 01-10-1998 AS PER EVIDENCE ON RECORD THAT IN THE YEAR 1992. IN THE LAY OUT PLAN IS IN RESPEC T OF THE SAME LAND THEN HOW IT CAN BE CLAIMED THAT THERE ARE SEPARATE AND DISTI NCT HOUSING PROJECTS. HE 5 ITA NO.1504/PN/2014 REFERS TO SEC. 80IB(10) AND ADVANCED HIS ARGUMENT B Y STATING THAT EVEN IF THERE IS A MULTIPLE SANCTIONED, THEN THE DATE OF LA ST SANCTIONED WILL RELATE BACK TO THE DATE ON WHICH THE FIRST APPROVAL WAS GI VEN TO THE PLAN. IN SUM AND SUBSTANCE, HE SUPPORTED THE APPROACH OF THE ASS ESSING OFFICER TREATING ONLY ONE HOUSING PROJECT OF THE ASSESSEE WHICH ACCO RDING TO THE ASSESSING OFFICER THE PROJECT WAS ORIGINALLY COMMENCED PRIOR TO 01-10-1998. 9. THE ASSESSEE FILED THE LAY OUT PLAN BEFORE US AS WELL AS THE COPY OF THE COMMENCEMENT CERTIFICATES AND COMPLETION CERTIF ICATES. IN THE PRESENT CASE THE ASSESSEE HAS CLAIMED THE DEDUCTION U/S. 80 IB(10) IN RESPECT OF PROFIT DERIVED FROM THE PROJECT KUBERA SANKUL WHI CH WAS SUBSEQUENTLY DESIGNATED KUBERA SANKUL, PHASE-I WHICH CONSISTED OF THE FOUR BUILDINGS A, B, C AND A-1. THE FACTS ARE NOT IN DISPUTE AS T HE BUILDING PLAN FOR THOSE FOUR BUILDINGS WAS APPROVED VIDE CC NO. 1486 DATED 23-01-2004. THE RESERVATION OF THE ASSESSING OFFICER IS THAT KUBER A SANKUL IS A PART AND EXTENSION OF THE ASSESSEES PROJECT I.E. KUBERA VI HAR WHICH ALSO COMPRISES OF THE FOUR BUILDINGS AND HAD COMMENCED IN THE YEAR 1992. EVEN IT IS NOT DISPUTED BEFORE US BY THE REVENUE THAT THE KUBERA SANKUL, PHASE-I THE PLAN FOR FOUR BUILDINGS WAS SANCTIONED IN JANUARY, 2004. THE ASSESSEE HAS NOT CLAIMED ANY DEDUCTION U/S. 80IB(10) IN RESPECT OF KUBERA VIHAR. AS PER BUILDING PLAN APPROVED DATED 25-06-2002, THERE ARE FOUR BUILDINGS AS A-2, A- 3, B-2 AS EXISTING AND B-1 AS PROPOSED. THE FINAL CC IN RESPECT OF KUBERA VIHAR IS IN RESPECT OF THE BUILDING B-1 WHICH WAS RECEIVED ON 11-07-2003. THE ASSESSEE GOT THE BUILDING PLAN APPROVAL IN RESP ECT OF THE KUBERA SANKUL ON 23-01-2004 AS EXPLAINED BY THE LD. COUNS EL AFTER THE ORDER OF AMALGAMATION OF THE PLOT DATED 22-01-2004. 10. IT IS ALSO SEEN THAT ON THE LAY OUT PLAN BUILDI NG A-2, A-1 AND B-2 ARE SHOWN AS AN EXISTING BUILDINGS MORE PARTICULARLY PL AN WHICH IS APPROVED ON 23-01-2004. ON PERUSAL OF THE LAYOUT PLAN TO OUR U NDERSTANDING BOTH THE PROJECTS ARE INDEPENDENT AND SEPARATE AS WHEN KUBE RA VIHAR WAS SANCTIONED AT THAT TIME KUBERA SANKUL WAS NOT CON CEIVED AT ALL. THE DEFINITION OF THE HOUSING PROJECT IS NOT GIVEN IN S EC. 80IB(10). IN THE CASE OF VANDANA PROPERTY (SUPRA) HON'BLE HIGH COURT OF BOMB AY HAS HELD THAT EVEN THE HOUSING PROJECT CAN BE COMPRISED OF THE SINGLE BUILDING ALSO AND IT IS NOT NECESSARY THAT FOR CLAIMING THE DEDUCTION U/S. 80IB (10) THE ASSESSEE SHOULD START THE HOUSING PROJECT ON PLOT OF LAND WHICH THE RE IS NO OTHER BUILDING. ON THE ADMITTED FACT THAT THE HOUSING PLAN FOR THE KU BERA SANKUL PROJECT, PHASE-I AND PHASE-II WERE APPROVED FOR THE FIRST T IME ON 23-01-2004 AND 27-01-2005 RESPECTIVELY WHICH ARE SUPPORTED BY THE DOCUMENTARY EVIDENCE LIKE SANCTIONS AND CC. SO IN OUR HUMBLE OPINION BO TH PROJECTS I.E. KUBERA VIHAR AND KUBERA SANKUL ARE INDEPENDENT PROJECTS . AFTER GIVING OUR ANXIOUS CONSIDERATION TO THE EVIDENCE PLACED BEFORE US AS WELL AS THE FACTS RECORDED BY THE LD. CIT(A), WE ARE OF THE OPINION T HAT THE LD. CIT(A) HAS RIGHTLY HELD THAT KUBERA SANKUL IS AN INDEPENDENT HOUSING PROJECT AND IT CANNOT BE TREATED AS AN EXTENSION OF THE KUBERA VI HAR WHICH WAS COMMENCED IN THE YEAR 1992. THE GROUNDS TAKEN BY T HE REVENUE ARE CONFINED ONLY TO THOSE REASONING AND NO SPECIFIC GR OUND IS TAKEN ON THE ISSUE OF THE VIOLATION OF CONDITION OF THE COMMERCI AL AREA BY THE REVENUE. WE, THEREFORE, FIND NO REASON TO INTERFERE WITH THE ORDER OF THE LD. CIT(A). ACCORDINGLY, THE SAME ARE CONFIRMED IN BOTH THE YEA RS. 4. AS THE FACTS ARE IDENTICAL AS IN THE A.YS. 2006- 07 AND 2007-08 WE, THEREFORE, FOLLOWING THE DECISION OF THIS TRIBUNAL IN THE ASSE SSEES OWN CASE CITED SUPRA 6 ITA NO.1504/PN/2014 CONFIRMED THE ORDER OF THE LD. CIT(A) AND GROUNDS T AKEN BY THE REVENUE ARE DISMISSED. 8. SINCE THERE IS NO CHANGES IN THE FACTS AND CIRCU MSTANCES IN THE ASSESSMENT YEAR UNDER APPEAL AND THE LD. DR HAS NOT PLACED ON RECORD ANY MATERIAL TO DISTINGUISH THE FINDINGS OF THE CO-ORDINATE BENCH, WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF THE CIT(A). ACCORDINGLY, THE IMPUGNED ORDER IS UPHELD AND THE APPEAL OF THE REVENUE IS DISMISSED BEING DEVOID OF MERIT. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED ON FRIDAY, THE 12 TH DAY OF FEBRUARY, 2016. SD/- SD/- ( R.K. PANDA ) ( VIKAS AWASTHY ) / ACCOUNTANT MEMBER # / JUDICIAL MEMBER PUNE ; DATED : 12 TH FEBRUARY, 2016. %&'#()!*!+( / COPY OF THE ORDER IS FORWARDED TO : 1) THE ASSESSEE; 2) THE DEPARTMENT; 3) THE CIT(A)-II, PUNE; 4) THE CIT-II, PUNE; 5) THE DR B BENCH, I.T.A.T., PUNE; 6) GUARD FILE. %, / BY ORDER , ' # //TRUE COPY// $%& # '( / SR. PRIVATE SECRETARY ) '*, / ITAT, PUNE