Century Galaxy Developers Limited, Bangalore V. Deputy Commissioner Of Income Tax, Circle- 2(1)(1), Bangalore

ITA 1637/BANG/2019

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 4408 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-11-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2015-2016
• Appeal Filed On: 15-07-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: GANESH R GHALI TO DEPA
• Assessee Lawyers: S RAMASUBRAMANIAM
• Keywords: Depreciation
• Section: 201

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC - C BENCH : BANGALORE BEFORE SHRI N. V. VASUDEVAN, VICE PRESIDENT ITA NO. 16 37 /BANG/20 1 9 ASSESSMENT YEAR : 201 5 - 1 6 M/S. CENTURY GALAXY DEVELOPERS LIMITED, NO.2, DIAMOND DISTRICT, AIRPORT ROAD, KODIHALLY, BENGALURU 560 017. PAN : A AAC C 9836 F VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 2(1)(1), BENGALURU. APPELLANT RESPONDENT ASSESSEE BY : SHRI. S. RAMASUBRAMANIAM , CA REVENUE BY : SHRI. GANESH R. GHALI, ADVOCATE STANDING COUNSEL TO DEPARTMENT DATE OF HEARING : 1 4 . 1 1 .201 9 DATE OF PRONOUNCEMENT : 27 . 1 1 .201 9 O R D E R THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDER DATED 29.05.2019 OF CIT(A) - 2, BENGALURU, RELATING TO ASSESSMENT YEAR 2015-16. 2. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS OF MAINTENANCE OF APARTMENTS. THE ASSESSEE IS ASSESSED TO INCOME TAX BY THE LEARNED DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE - 2(1)(1), BANGALORE (HEREINAFTER REFERRED TO AS ASSESSING OFFICER). FOR THE ASSESSMENT YEAR 2015-16 THE ASSESSEE HAD FILED A RETURN OF INCOME DECLARING A LOSS OF 3,14,33,156/- AFTER CLAIMING A DEPRECIATION OF RS. 3,61,48,291/- ON BUILDING. THE ASSESSEE OWNS A RESIDENTIAL APARTMENT COMPLEX AT KODIHALLY VILLAGE, ITA NO. 1637/BANG/2019 PAGE 2 OF 3 BANGALORE AIRPORT ROAD, VARTHUR, HOBLI, BANGALORE SOUTH. AS PER THE SCHEME FRAMED BY THE ASSESSEE, THE APARTMENTS OWNED BY IT WERE ALLOTTED TO VARIOUS SHAREHOLDERS/ALLOTTEES. AS PER THE SCHEME, THE USER RIGHTS VESTS WITH THE SHAREHOLDERS OF THE ASSESSEE. THE LEGAL OWNERSHIP CONTINUES TO VEST WITH THE ASSESSEE. VARIOUS COMMON AREAS IN THE APARTMENT COMPLEX BELONGS TO THE ASSESSEE AND THEY ARE NOT ALLOTTED TO ANY SHAREHOLDER. 3. THE ASSESSEE HAD BEEN CLAIMING DEPRECIATION RIGHT FROM THE ASSESSMENT YEAR 2003-04 ONWARDS. THE ASSESSING OFFICER HAS BEEN DISALLOWING THE DEPRECIATION ON THE GROUND THAT THE SHAREHOLDER/ALLOTTEES ARE THE OWNERS OF THE APARTMENT AND NOT THE ASSESSEE. THE MATTER WAS TAKEN UP IN APPEAL WHEREIN THE APPELLATE AUTHORITIES INCLUDING THE HON'BLE KARNATAKA HIGH COURT HELD THAT THE ASSESSEE IS NOT ENTITLED TO DEPRECIATION. ON A SPECIAL PETITION FILED BEFORE THE HON'BLE SUPREME COURT, THE MATTER WAS RESTORED TO HIGH COURT. THE APPEAL IS PENDING BEFORE HIGH COURT. 4. THE CIT(A), IN UPHOLDING THE ACTION OF THE AO, FOLLOWED THE DECISION OF THE ITAT IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2003-04. I AM OF THE VIEW THAT IN THE LIGHT OF THE DECISIONS OF THE TRIBUNAL, WHICH WERE UPHELD BY THE HONBLE KARNATAKA HIGH COURT, THE ORDER OF THE CIT(A) DOES NOT REQUIRE ANY INTERFERENCE AT THIS STAGE. 5. ACCORDINGLY, THE APPEAL OF THE ASSESSEE IS DISMISSED. ITA NO. 1637/BANG/2019 PAGE 3 OF 3 6. IN THE RESULT, THE APPEAL BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 27 TH DAY OF NOVEMBER, 2019. SD / - SD/ - (B. R. BASKARAN) ACCOUNTANT MEMBER (N. V. VASUDEVAN) VICE PRESIDENT BANGALORE. DATED: 27 TH NOVEMBER, 2019. /NS/* COPY TO: 1. APPELLANTS 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, ITAT, BANGALORE.