ACIT-26, , MUMBAI V. SANGEETA ENTERPRISES, MUMBAI

ITA 1739/MUM/2020

• Counselvise Citation: [2022] 106 COUNSELVISE.COM (IT) 9585 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 10 month(s) 20 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-07-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2010-2011
• Appeal Filed On: 16-08-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Section: 143(3)

Judgement Text

आयकर य कर म ु ंबई ठ “ ई ” क , य यक य ए ं एम ब ग ेश, ेख क र य के म" IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH “E ”, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER & SHRI M. BALAGANESH, ACCOUNTANT MEMBER आ ं. 1739/म ु ं/20 20 ( ). . 2010-11) ITA NO. 1739/MUM/2020(A.Y.2010-11) ACIT -26(3), R.No.332, 3 rd Floor, Kautilya Bhavan, G-Block, Bandra Kurla Complex, Bandra (E), Mumbai – 400 051 ...... + /Appellant ब) म Vs. Sangeeta Enterprises, 101, Sngeeta Enclave, Sarvoday Nagar, Mulund(W), Mumbai 400 080 PAN:AANFS-0061-J ..... , - /Respondent + . र / Appellant by : None , - . र /Respondent by : Shri Pitta Samuel ु ) ई क/ - / Date of hearing : 07/07/2022 012 क/ - / Date of pronouncement : 07/07/2022 आदेश/ ORDER PER VIKAS AWASTHY, JM: This appeal by the Revenue is directed against the order of Commissioner of Income Tax (Appeals)-40, Mumbai ( in short ‘the CIT(A) ’) dated 18/02/2020 for the assessment year 2010-11. 2. The Revenue in appeal has raised as many as six grounds, assailing the findings of CIT(A) deleting the addition of Rs.2,62,11,000/- made on account of undisclosed sale of flats. 2 ITA NO. 1739/MUM/2020(A.Y.2010-11) 3. Shri Pitta Samuel representing the Department submitted that the assessee is a Builder and Developer. During the period relevant to assessment year under appeal, the assessee sold five flats with a total consideration of Rs.2,62,11,000/-, however, the same was not disclosed in the return of income. The Assessing Officer made addition of the aforesaid amount as undisclosed business income. Against the assessment order dated 28/12/2015 passed under section 143(3) r.w.s. 147 of the Income Tax Act, 1961 [ in short ‘ the Act Act’], the assessee filed appeal before the CIT(A) inter- alia assailing the addition on merits and reopening of the assessment . The CIT(A) deleted the addition on the ground that the amount has been offered to tax in subsequent assessment years ie. Assessment year 2011-12 and 2012-13. The CIT(A) failed failed to take into consideration the fact that the sale agreement in respect of the flats was registered during assessment year 2010- 11. Hence, the sale consideration received for these flats is taxable during the impugned assessment year.The ld.Departmental Representative vehemently supported the findings of the Assessing Officer and prayed for reversing the findings of CIT(A). 4. We have heard the submissions made by ld.Departmental Representative. Orders of the authorities below examined. The solitary issue raised in appeal by the Revenue is deleting addition of Rs.2,62,11,000/- made on account of undisclosed sale of flats. The assessee is following Project Completion Method. Undisputedly, during the period relevant to assessment year under appeal, the assessee has sold five flats with a total consideration of Rs.2,62,11,000/-. The assessee has been consistently offering income from sale of flats on collection of full amount and after handing over possession of flats to the purchasers. This method of accounting has been adopted by the 3 ITA NO. 1739/MUM/2020(A.Y.2010-11) assessee from the commencement of its business and the same has been accepted by the Department in past. This fact has been recorded by the CIT(A) in the impugned order. The Revenue has not rebutted the said finding of fact recorded by the First Appellate Authority. The First Appellate Authority has further recorded the fact that the assessee has offered sale consideration in respect of the five flats which are under dispute in the subsequent assessment years i.e. when possession of flats is handed over to the assessee after receiving full consideration. The assessee has offered Rs.1,46,23,000/- in assessment year 2011-12 and Rs.1,15,18,000/- in assessment year 2012-13. This fact has not been disputed by the Revenue. The impugned year is the only assessment year where the Department has questioned assessee’s method of recognizing sales and has disturbed the method of recognizing profit consistently followed by the assessee. The CIT(A) after examining the facts has deleted the addition made by Assessing Officer. We find no infirmity in the impugned order, hence, the same is upheld and appeal of the Revenue is dismissed being devoid of any merit. Order pronounced in the open court on Thursday the 07th th day of July, 2022. Sd/- Sd/- ( M. BALAGANESH ) (VIKAS AWASTHY) ेख क र य/ACCOUNTANT MEMBER य यक य/JUDICIAL MEMBER म ु ंबई/ Mumbai, 3 ) ंक/Dated 07/07/2022 Vm, Sr. PS(O/S) 4 ITA NO. 1739/MUM/2020(A.Y.2010-11) े Copy of the Order forwarded to : 1. +/The Appellant , 2. , - / The Respondent. 3. आयकर आय ु 4-( )/ The CIT(A)- 4. आयकर आय ु 4- CIT 5. 5 ग य , - ) , आय. . ., म ु बंई/DR, ITAT, Mumbai 6. ग 78 9 : /Guard file. BY ORDER, //True Copy// (Dy./Asstt. Registrar) ITAT, Mumbai