M/S. PUSHPA DEVELOPERS CO., MUMBAI V. DCIT , CIRCLE-3, THANE

ITA 1640/MUM/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 3332 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 2 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-09-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: C
• Assessment Year: 2011-2012
• Appeal Filed On: 30-06-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: B BAGCHI
• Keywords: Opportunity of being heard

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES C , MUMBAI BEFORE SHRI SAKTIJIT DEY, JUDICIAL MEMBER AND SHRI RAJESH KUMAR , ACCOUNTANT MEMBER ITA NO. 1640 /MUM/2020 ASSESSMENT Y EAR: 2011 - 12 & ITA NO. 1641/MUM/2020 ASSESSMENT Y EAR: 2015 - 16 M/S PUSHPA DEVELOPERS CO., G - 8, VANRAJ C.H.S. LTD., NEAR FOREST COLONY, KOPRI, THANE (E) - 400601 PAN: AADFP5631M VS. D.C.I.T., CIRCLE - 3, ROOM NO. 29, B - WING, 6 TH FLOOR, ASHAR I.T. PARK, WAGLE INDUSTRIAL ESTATE, THANE - 400604 (APPEL LANT) (RESPONDENT) ASSESSEE BY : VIPUL JOSHI (A R) REVENUE BY : BBAGCHI (DR) DATE OF HEARING : 21 /09 /202 1 DATE OF PRONOUNCEMENT: 29 / 09 /202 1 O R D E R PER SAKTIJIT DEY , J M CAPTIONED APPEALS BY THE ASSESSEE ARISE OUT OF TWO SEPARATE ORDERS , BOTH DATED 26.02.2020 , OF LEARNED COMMISS IONER OF INCOME TAX (APPEALS) - 2 , THANE FOR THE ASSESSMENT YEAR S 2011 - 12 AND 2015 - 16 . ITA NO. 1640/MUM/2020 (A.Y. 2011 - 12) 2. GROUND NO. 1, BEI NG NOT PRESSED, IS DISMISSED. 3. A S REGARDS GROUND N O. 2, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED , THOUGH , THE ASSESSING OFFICER (AO) MADE AN ADDITION OF RS. 1,57,43,696/ - ON 2 ITA NO S . 1640 & 1641 / MUM/2020 ASSESSMENT YEAR S : 2011 - 1 2 & 20 15 - 16 ACCOUNT OF ALL EGED DI FFERENCE IN VALUATION OF CLOSING STOCK OF UNSOLD TRANSFER ABLE DEVELOPMENT RIGHT ( TDR ) AND THE VALUE AT WHICH THE ASSESSEE ACTUALLY SOLD TDR DURING THE YEAR . THOUGH, T HE ADDITION WAS CONFIRMED BY LE ARNED COMMISSIONER (APPEALS), H OWEVER, CONSIDE RING THE FACT THAT DEDUCTION UNDER SECTION 80IB(10) OF THE INCOME TAX ACT, 1961 HAS BEEN ALLOWED ON THE SAID ADDITION BY LEARNED COMMISSIONER (APPEALS) RESULTING IN ACCEPTANCE OF THE IN COME DECLARED BY THE ASSESSEE I N THE RETURN OF INCOME, THERE IS NO TAX IMPLICATION ON THE ASSESSEE. THEREFORE, ON INSTRUCTIONS, HE REQUESTED FOR WITHDRAWAL OF THE PRESENT APPEAL. AS THE ISSUE RAISED HAS BECOME ACADEMIC. 4. THE LEARNED DEPAR TMENTAL REPRESENTATIVE AGREED WITH THE AFORESAID SUBMISSION OF THE ASSESSEE. IN VIEW OF THE STATED FACTUAL POSITION, THE APPEAL HAVING BECOME INFRUCTUOUS IS DISMISSED. ITA NO. 1641/MUM/2020 (A.Y. 2015 - 16 ) 5. IN THE MAIN GROUNDS OF APPEAL FILED WITH THE MEMORANDUM OF APPEAL, THE ASSESSEE HAS CHALLENGED THE ADDITION OF RS . 76,63,514/ - BEING THE PROFIT DERIVED FROM SALE OF TDR. HOWEVER, VIDE LETTER DATED 29.09 .2020, THE ASSESSEE HAS RAISED THE FOLLOWING ADDITIONAL GROUNDS: - 3A DOUBLE ADDITION WITHOUT PREJUDICE TO THE EARLIER GROUNDS, IT IS SUBMITTED THAT IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE ADDITION OF RS. 76,63,541/ - (ON ACCOUNT OF SALE OF TDR) MADE BY THE A.O. AND CONFIRMED BY THE LD. CIT(A), AMOUNTED TO DOUBLE ADDITION IN AS MUCH AS THE SAME WAS ALREADY SUBJECT MATTER OF ADDITION IN THE A.Y. 2011 - 2012. 3B CLAIM OF BUSINESS DEDUCTION/BUSINESS LOSS/BAD DEBT WITHOUT PREJUDICE TO THE EARLIER GROUNDS, IT IS SUBMITTED THAT IN THE FACTS AND THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE 3 ITA NO S . 1640 & 1641 / MUM/2020 ASSESSMENT YEAR S : 2011 - 1 2 & 20 15 - 16 APPELLANT IS ENTITLED FOR THE DEDUCTION OF RS. 80,83,281/ - , BEING THE DIFFERENCE BETWEEN RS. 1,57,46,696/ - (THE AMOUNT OF ADDITION MADE IN A.Y. 2011 - 2012 ON ACCOUNT OF ESTIMATED SALE PRICE OF TDR) AND RS. 76,63,415/ - (THE AMOUNT OF ACTUAL SALE PRICE RECEIVED IN A.Y. 2015 - 2016), BY WAY OF BUSINESS DEDUCTION/BUSINESS LOSS/BAD DEBT. SINCE, THE ADDITIONAL GROUNDS RAISED BY THE ASSESSEE CAN BE DECIDED WITHO UT INVESTIGATING INTO FRESH FACTS, WE ADMIT THE ADDITIONAL GROUNDS FOR ADJUDICATION. 6. DRAWING OUR ATTENTION TO GROUND NO. 3A OF THE ADDITIONAL GROUND S , LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE IS A BUILDER AND DEVELOPER AND WAS DEVEL OPING A PROJECT FOR SLUM REHABILITATION AUTHORITY (SRA). HE SUBMITTED, THE ASSESSEE RECOGNIZES REVENUE FOLLOWING PROJECT COMPLETION METHOD AND THE PROFIT FROM T HE SRA PROJECT WAS OFFERED IN ASSESSMENT YEAR 2011 - 12 AFTER COMPLETION OF THE PROJECT. HE SUBMIT TED, THOUGH, THE ASSESSEE HAD APPLIED FOR TDR OF 488.29 SQ.MTR, HOWEVER, IT WAS N OT GRANTED TO THE ASSESSEE IN ASSESSMENT YEAR 2011 - 12 AND TH E ASSESSEE HAD SHOWN VALUE OF UNSOLD TDR IN ITS ACCOUNT. HE SUBMITTED, THE PROFIT FR OM THE SRA PROJECT OFFERED IN A SSESSMENT YEAR 2011 - 12 ALSO INCLUDED AN AMOUNT OF RS. 10,51,190/ - , BEING THE VALUE OF UNSOLD TDR AS PER VALUATION MADE ON THE BASIS OF COST OR MARKET VALUE, WHICHEVER IS LESS. HE SUBMITTED, WHILE COMPLETING THE ASSESSMENT FOR ASSESSMENT YEAR 2011 - 12, THE A O DETERMINED THE VALUE OF TDR AT RS. 1,67,94,886/ - AND ADDED TO THE PROFIT OF THE SRA PROJECT. HE SUBMITTED, THE AO ALSO DID NOT ALLOW DEDUCTION UNDER SECTION 80IB(10) . HE SUBMITTED, THOUGH, LEARNED COMMISSIONER (APP EALS) UPHELD THE ADDITION OF TDR, H OWEVE R, HE ALLOWED A SSESSEES CLAIM OF 4 ITA NO S . 1640 & 1641 / MUM/2020 ASSESSMENT YEAR S : 2011 - 1 2 & 20 15 - 16 DEDUCTION UNDER SECTION 80IB(10) OF THE ACT IN RESPECT OF TDR. HE SUBMITTED, IN THE ORDER GIVING EFFECT TO THE ORDER OF LEARNED COMMISSIONER (APPEALS), T HE A O HAS ALSO ALLOWED DEDUCTION UNDER SECTION 80IB(10) OF THE ACT IN RESPECT OF TDR. THUS, HE SUBMITTED, ON C E ADDITION IN RESPECT OF ENTIRE VALUE OF UNSOL D TDR WAS MADE IN ASSESSMENT YEAR 2011 - 12, NO FURTHER ADDITION IN RESPECT OF SALE OF PART OF SUCH TDR COULD BE MADE IN THE IMPUGNED ASSESSMENT YEAR, A S IT WOULD AMOUNT TO DOUBLE ADDITION OF THE SAME INCOME. FURTHER, HE FAIRLY SUBMITTED THAT THIS FACT WAS NEVER BROUGHT TO NOTICE OF THE DEPARTMENTAL AUTHORITIES IN COURSE OF PROCEEDING S BEFORE THEM. THUS, HE SOUGHT APPROPRIATE DIRECTION TO THE AO. 7. THE LEARNED DEPARTMENTAL REPRESENTATIVE HAS NO OBJECTION FOR RESTORATION OF THE ISS UE TO THE AO FOR CONSIDERING ASSESSEES CLAIM AFTER FACTUAL VERIFICATION. 8 . WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE MATERIALS ON RECORD. IN PRINCIPLE, WE AGREE WITH THE SUBMISSIONS OF LEARNED COUNSEL FOR THE ASSESSEE THAT IF A PARTICULAR ITEM OF INCOME HAS BEEN ADDED IN ONE ASSESSMENT YEAR, THE SAME AMOUNT OF INCOME OR A PART OF IT CANNOT BE ADDED IN ANOTHER ASSESSMENT YEAR. FROM THE FACTS ON RECORD , PRIMA FACIE, IT APPEARS THAT THE EN TIRE EST IMATED VALUE OF UNSOLD TDR MEASURING 488.29 SQ.MTR WAS ADDED T O THE INCOME OF THE ASSESSEE IN ASSESSMENT YEAR 2011 - 12. IT IS EVIDENT, THE ASSESSEE HAS SOLD A PART OF THE TDR IN THE IMPUGNED ASSESSMENT YEAR. THE CONSIDERATION RECEIVED FROM SALE OF S UCH TDR HAS BEEN ADDED TO THE INCOME OF THE ASSESSEE IN THE IMPUGNED ASSESSMENT YEAR. THUS, PRIMA FACIE, IT APPEARS TO BE A CASE OF ADDITION OF THE SAME 5 ITA NO S . 1640 & 1641 / MUM/2020 ASSESSMENT YEAR S : 2011 - 1 2 & 20 15 - 16 INCOME IN TWO DIFFERENT ASSESSMENT YEARS . HOWEVER, SINCE THE ISSUE HAS BEEN RAISED FOR THE FIRST TIME B EFORE US AND T HE DEPARTMENTAL AUTHORITIES HAD NO OCCA SION TO VERIFY ASSESSEES CLAIM, W E ARE INCLINED TO RESTORE THE ISSUE TO THE AO FOR FACTUAL VERIFICATION AND DECIDING ASSESSEES OBJECTION REGARDING DOUBLE ADDITION OF THE SAME INCOME . THE AO IS DIRECTED TO VERIFY THE FACTS AND DECIDED ASSESSEES CLAIM AFTER DUE OPPORTUNITY OF BEING HEARD. 9. IN VIEW OF OUR AFORESAID DECISION, THE OTHER SUBSTANTIVE GROUND S RAISED BY THE ASSESSEE BEING GROUND N O S . 2.1 TO 2.3 AND 3.1 OF THE MAIN GROUND S ALONG WITH GROUND N O. 3B OF THE ADDITIONAL GROUND S ARE RESTORED BACK TO THE AO FOR ADJUDICATION , IF WARRANTED . 10 . IN THE RESULT, APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 11 . TO SUM UP OF APPEAL IN ITA NO. 1640/MUM/2020 IS DISMISSED AND ITA NO. 1641/MUM/2020 IS ALLOWED FOR STATISTICAL PURPOSES ORDER PRONOUNCED IN THE OPEN COURT ON 29 TH SEPTEMBER , 2021 . SD/ - SD/ - ( RAJESH KUMAR ) ACCOUNTANT MEMBER (SAKTIJIT DEY) JUDICIAL MEMBER MUMBAI ; DATED: 29 / 09 /202 1 ALINDRA, PS 6 ITA NO S . 1640 & 1641 / MUM/2020 ASSESSMENT YEAR S : 2011 - 1 2 & 20 15 - 16 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . / BY ORDER, //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI