The ACIT Circle -7(1), Hyderabad V. M/s IVRCL Batpasco Abb & Aag(JV), Hyderabad

ITA 1544/HYD/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 1446 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-01-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 08-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUDHAKAR RAO
• Assessee Lawyers: V RAGHAVENDRA RAO
• Keywords: Rejection of books of accounts; Diversion of income; Question of law

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B, HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO. ASST YEAR APPELLANT RESPONDENT 1539/HYD/2012 2009-10 ASSTT. COMMI- SSIONER OF INCOME- TAX CIRCLE 7(1), HYDERABAD M/S. IVRCL KBL(JV), HYDERABAD (PAN - AAAAI 1804 R) 1540/HYD/2012 2009 - 10 ASSTT. COMMI - SSIONER OF INCOME- TAX CIRCLE 7(1), HYDERABAD M/S. IVRCL JL(JV), HYDERABAD (PAN - AAAAI 1688 K) 1541/HYD/2012 2009-10 ASSTT. COMMI- SSIONER OF INCOME- TAX CIRCLE 7(1), HYDERABAD M/S. IVRCL KBL MEIL (JV), HYDERABAD (PAN - AACFI 3940 F) 1542/HYD/2012 2009-10 ASSTT. COMMI- SSIONER OF INCOME- TAX CIRCLE 7(1), HYDERABAD M/S. IVRCL SEW WPIL (JV), HYDERABAD (PAN - AAACFI 6045 B) 1543/HYD/2012 2009-10 ASSTT. COMMI- SSIONER OF INCOME- TAX CIRCLE 7(1), HYDERABAD M/S. IVRCL BATPASCO WPIL & MHI (JV), HYDERABAD (PAN - AACFI 6047 D) 1544/HYD/2012 2009-10 ASSTT. COMMI- SSIONER OF INCOME- TAX CIRCLE 7(1), HYDERABAD M/S. IVRCL BATPASCO ABB & AAG (JV), HYDERABAD (PAN - AACFI 6047 D) APPELLANT BY : SHRI SUDHAKAR RAO CIT - DR RESPONDENT S 3 BY : SHRI V.RAGHAVENDRA RAO DATE OF HEARING 15 .1.2013 DATE OF PRONOUNCEMENT 15.1.2013 \\ ITA NO.1539 TO 1544/HYD/12 M/S. IVRCL KBL(JV), AND OTHERS, HYDERABAD 2 O R D E R PER CHANDRA POOJARI, ACCOUNTANT, JUDICIAL MEMBER: THESE SIX APPEALS BY THE REVENUE ARE DIRECTED AGA INST SIMILAR BUT SEPARATE ORDERS AOF THE COMMISSIONER OF INCOME- TAX(APPEALS) VI, HYDERABAD, ALL DATED 20.7.2012, FOR THE ASSESSMENT YEAR 2009-10. SINCE A COMMON ISSUE IS INVOLVED, THESE APPEALS ARE BEING DISPOSED OFF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. EFFECTIVE GROUNDS OF THE REVENUE, COMMON IN ALL THESE APPEALS, AS TAKEN FROM APPEAL ITA NO.1539/HYD/2012, ARE AS FOLLOWS- 1. THE CIT APPEALS ERRED ON FACTS AND IN LAW. 2. THE CIT(A) OUGHT TO HAVE APPRECIATING THE ACTI ON OF THE ASSESSING OFFICER IN REJECTION OF BOOKS OF ACCOUNTS IN A HOLI STIC VIEW THAT THE ASSESSEE HAS FAILED TO COMPLY WITH THE PROVISIONS O F SECTION 198 AND 199 OF THE IT ACT. 3. THE ASSESSEE HAS VIOLATED THE PROVISIONS OF SEC. 198 OF IT ACT BY NOT OFFERING ANY INCOME FOR TAXATION. THE CIT(A) HA S FAILED TO TAKE COGNIZANCE OF THE ABOVE PROVISION WHICH INVOLVES A SUBSTANTIAL QUESTION OF LAW AND FACT. 3. WE HEARD BOTH SIDES AND PERUSED THE ORDERS OF T HE LOWER AUTHORITIES AND OTHER MATERIAL ON RECORD. AS BROU GHT TO OUR NOTICE BY THE LEARNED COUNSEL FOR THE ASSESSEE AND NOT DISPUTED B Y THE LEARNED DEPARTMENTAL REPRESENTATIVE, THE ISSUE INVOLVED IN THE ABOVE GROUNDS OF THE REVENUE IS COVERED BY THE DECISION OF THE TRIBU NAL IN ASSESSEES OWN CASES, VIZ. IVRCL-KBB-MEIL(JV), IVRCL-KBL-(JV) AND M/S. IVR CL-JL(JV), IN ITA NOS.1197 TO 1199/HYD/2011 FOR ASSESSMENT YEA R 2008-09, WHEREIN THIS TRIBUNAL, VIDE ORDER DATED 12.7.2012, HAS DECIDED THE ISSUE INVOLVED IN THE ABOVE GROUNDS, IN FAVOUR OF THE ASS ESSEE BY OBSERVING IN PARA 53 THEREOF AS FOLLOWS- ITA NO.1539 TO 1544/HYD/12 M/S. IVRCL KBL(JV), AND OTHERS, HYDERABAD 3 53. IN OUR OPINION, NO INCOME ACCRUED IN THE HANDS OF THE PRESENT ASSESSEE AS JV AS THE ENTIRE PROJECT VALUE OF THE WORK IN THE FORM OF GROSS RECEIPTS BEING AN INCOME PRODUCIN G ASSET WAS DIVESTED AND WAS TRANSFERRED BY THE ASSESSEE TO ITS CONSTITUENTS. THE UNDERSTANDING AND OR THE AGREEMENT AMONGST THE CONSTITUENTS OF THE JOINT VENTURE IS ONLY DIVERSION OF INCOME BY OVERRIDING TITLE WHICH PRINCIPLE SHALL NOT ENABLE THE ASSESSING OFFI CER TO ESTIMATE ANY THEORETICAL INCOM E FOR THE PURPOSE OF LEVYING TAX ON IT. IN VIEW OF THE ABOVE DISCUSSION, WE ARE OF THE OPINION THAT THE CIT(A) IS JUSTIFIED IN HOLDING THAT INCOME IS TO BE ASSESSED NOT IN THE HANDS OF THE ASSESSEE. CONSISTENT WITH THE VIEW TAKEN IN THAT ORDER FOR TH E IMMEDIATELY PRECEDING YEAR, VIZ. 2008-09, TO WHICH BOTH OF US A RE PARTIES, WE FIND NO MERIT IN THE GROUNDS OF THE REVENUE IN THESE APPEAL S. WE ACCORDINGLY REJECT THE SAME, UPHOLDING THE ORDERS OF THE CIT(A) IMPUGNED IN THESE APPEALS. 4. IN THE RESULT, ALL THE SIX APPEALS OF THE REVEN UE ARE DISMISSED. PRONOUNCED IN THE COURT ON THE CONCLUSION OF HEAR ING ON THESE APPEALS ON 15.1.2013 SD/- (ASHA VIJAYARAGHAVAN) SD/- (CHANDRA POOJARI) JUDICIAL MEMBER. ACCOUNTANT MEMBER. DT/- 15 TH JANUARY, 2013 COPY FORWARDED TO: 1. M/S. IVRCL K B L(JV), 10 - 3 - VB, M - 22/RT, VIJAYANAGAR COLONY, HYDERABAD 2. M/S. IVRCL JL(JV), 10-3-VB, M-22/RT, VIJAYANAGAR COLONY, HYDERABAD 3. 4. 5. M/S. IVRCL K B L MEIL (JV), 10 - 3 - VB, M - 22/RT, VIJAYANAGAR COLONY, HYDERABAD M/S. IVRCL SEW WPIL (JV), 10-3-VB, M-22/RT, VIJAYA NAGAR COLONY, HYDERABAD M/S. IVRCL M/S. IVRCL BATPASCO WPIL & MHI (JV) , 10 - 3 - ITA NO.1539 TO 1544/HYD/12 M/S. IVRCL KBL(JV), AND OTHERS, HYDERABAD 4 6. 7. 8. 9. 10. VB, M - 22/RT, VIJAYANAGAR COLONY, HYDERABAD M/S. IVRCL BATPASCO ABB & AAG (JV), 10-3-VB, M-22 /RT, VIJAYANAGAR COLONY, HYDERABAD ASSTT. COMMISSIONER OF INCOME-TAX, CIRCLE 7(1), HYD ERABAD COMMISSIONER OF INCOME-TAX(APPEALS) VI, HYDERABAD COMMISSIONER OF INCOME-TAX V, HYDERABAD DEPARTMENTAL REPRESENTATIVE ITAT, HYDERABAD B.V.S.