Deputy Commissioner of Income-tax, Circle - 3, Pune V. M/s. Bhujbal Brothers Construction Company, Pune

ITA 1795/PUN/2017

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 4966 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 6 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-02-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 24-07-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK MALVIYA
• Keywords: Set aside
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUNE BEFORE SHRI GEORGE MATHAN , J UDICIAL M EMBER AND SHRI ANIL CHATURVEDI, A CCOUNTANT M EMBER . / I TA NO.1795 /PUN/20 17 / ASSESSMENT YEAR : 2010 - 11 THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE - 3, PUNE. ....... / APPELLANT / V/S. M/S. BHUJBAL BROTHERS CONSTRUCTION COMPANY, BHUJBAL HOUSE, SR. NO.28, KARVE NAGAR, PUNE - 411 052. PAN: AAGPB7974A / RESPONDENT A SSESSEE BY : NONE REVENUE BY : SHRI ALOK MALVIYA / DATE OF HEARING : 1 9 .02.2020 / DATE OF PRONOUNCEMENT : 21 .0 2 .2020 / ORDER P ER ANIL CHATURVEDI , A M : THIS APPEAL FILED BY THE REVENUE IS EMANATING OUT OF THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS) - 2 , PUNE DATED 25.11.2016 FOR ASSESSMENT YEAR 2010 - 11. 2 ITA NO. 1795 /PUN/20 17 A.Y. 2010 - 11 2 . THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RECORD ARE AS UNDER: - THE ASSESSEE IS A PARTNERSHIP FIRM STATED TO BE ENGAGED IN THE BUSINESS OF CONSTRUCTION OF BUILDING AND PROMOTING. THE ASSESSEE FILED ITS RETURN FOR A SSESSMENT YEAR 2010 - 11 DECLARING TOTAL TAXABLE INCOME OF RS.37,79,130/ - . THE CASE WAS SELECTED FOR SCRUTINY AND ASSESSMENT WAS FRAMED U/S.143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) WHEREIN DEDUCTION U/S.80IB(10) OF THE ACT WI TH RESPECT TO THE HOUSING PROJECT OF DAMODAR RESIDENCY CONSTRUCTION WAS DISALLOWED BY THE ASSESSING OFFICER. THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(APPEALS) WHERE NO RELIEF WAS GIVEN TO IT . T HE ASSESSEE THEREAFTER CARRIED THE MATTER BEFORE THE TRIBUNAL. THE TRIBUNAL ALLOWED THE APPEAL OF THE ASSESSEE BY GRANTING DEDUCTION U/S.80IB(10) OF THE ACT . ON DEDUCTION U/S.80IB(10) OF THE ACT THAT WAS DENIED BY THE ASSESSING OFFICER , THE ASSESSING OFFICER VIDE PENALTY ORDER DATED 27.03.2015 LEVIED PENALT Y OF RS.4,38,42,779/ - U/S.271(1)(C) OF THE ACT. 3 . AGGRIEVED BY THE PENALTY ORDER, THE ASSESSEE CARRIED THE MATTER BEFORE THE LD. CIT(APPEALS) WHO AFTER NOTING THE FACTS THAT SINCE QUANTUM ITSELF HAS BEEN DELETED BY THE TRIBUNAL, THERE REMAINS NO BASIS FOR SUSTAINING THE PENALTY U/S.271(1) (C) OF THE ACT HELD THAT PENALTY DOES NOT SURVIVE. THE LD. CIT(APPEALS) ACCORDINGLY DIRECTED FOR DELETION OF PENALTY. 4 . AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS), THE REVENUE IS IN APPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS: 3 ITA NO. 1795 /PUN/20 17 A.Y. 2010 - 11 1. ON THE FACTS AND CIR CUMSTANCES OF THE CASE, THE LD. CIT(A) ERRED IN DELETING THE PENALTY LEVIED U/S 271(1 )(C) OF THE I.T. ACT AND ALLOWING T HE ASSESSEE'S CLAIM OF DEDUCTION U/S 80IB (10) IN RESPECT OF PROJ ECT 'DAMODAR RESIDENCY'. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE PENALTY WITHOUT APPRECIATING THAT FACTS THAT THE ASSESSEE'S CLAIM OF DEDUCTI ON U/S. 80 IB (10) IS NOT IN ACCORDANCE WITH THE ACT SINCE THE PROJECT, 'DAMODAR RESIDENCY' WAS CONSTRUCTED /DEVELOPED IN LESS THAN 1 ACRE AREA, WHICH IS PRESCRIBED MINIMUM AREA AS PER THE PROVISIONS OF SECTION 80 IB (10) OF THE I.T. ACT. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE PENALTY WITHOUT APPRECIATING THE FACTS THAT ORDER OF THE ITAT AGAINST QUANTUM ADDITION ON WHICH CIT(A) RELIED UPON HAS BEEN CHALLENGED BY THE DEPARTMENT AND IS PENDING BEFORE HON. HIGH COURT, MUMBAI. 4. THE APPELLANT PRAYS TO BE ALLOWED TO ADD, AMEND, MODIFY, RECTIFY, DELETE OR RAISE ANY GROUNDS OF APPEAL DURING THE COURSE OF APPELLATE PROCEEDINGS . 5 . A T THE TIME OF HEARING, NEITHER THE ASSESSEE NOR HIS AUTHORIZED REPRESENTATIVE WAS PRESENT TO REPRES ENT THEIR CASE ON MERITS. THE RECORDS WERE CHECKED AND IT WAS FOUND THAT NOTICE OF HEARING HAS BEEN DULY ISSUED AND SERVED ON THE ASSESSEE. IN SPITE OF THE FACTS, THE ASSESSEE IS ABSENT ON THIS DATE OF HEARING & CONSIDERING THE FACTS AND CIRCUMSTANCES, WE PROCEED TO HEAR THE APPEAL ON MERITS AFTER HEARING THE LD. DR ON RECORD. 6 . BEFORE US, THE LD. DR SUPPORTED THE ORDER OF ASSESSING OFFICER. 7 . WE HAVE HEARD THE LD. DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ISSUE IN THE PRESENT APPEAL IS ABOUT THE DELETION OF PENALTY LEVIED U/S.271(1)(C) ON THE DEDUCTION U/S.80IB(10) THAT WAS DENIED BY THE ASSESSING OFFICER. WE FIND THAT THE LD. CIT(APPEALS) WHILE DELETING THE PENALTY HAS NOTED THAT THE TRIBUNAL VIDE ORD ER DATED 30.09.2015 IN ITA NO.1920/PN/2013 HAD DIRECTED THE ASSESSING OFFICER TO ALLOW THE CLAIM OF DEDUCTION U/S.80IB(10) OF THE ACT. SINCE DEDUCTION ON WHICH PENALTY HAS BEEN LEVIED HAS ITSELF BEEN 4 ITA NO. 1795 /PUN/20 17 A.Y. 2010 - 11 DELETED, THERE REMAINS NO BASIS FOR SUSTAINING THE PENAL TY. BEFORE US, THE LD. DR COULD NOT BRING ANY MATERIAL TO DEMONSTRATE THAT THE ORDER OF TRIBUNAL ALLOWING THE CLAIM OF DEDUCTION U/S.80IB(10) HAS BEEN SET ASIDE/ OVERTURNED BY HIGHER JUDICIAL FORUM MEANING THEREBY THAT THE ORDER GRANTING DEDUCTION TO ASSES SEE U/S.80IB(10) HAS ATTAINED FINALITY. IN SUCH SITUATION, WE FIND NO REASON TO INTERFERE WITH THE ORDER OF THE LD. CIT(APPEALS) AND THUS, GROUNDS RAISED BY THE REVENUE ARE DISMISSED. 8 . IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSED. ORDER PRO NOUNCED ON 21 ST DAY OF FEBRUARY, 2020. SD/ - SD/ - GEORGE MATHAN ANIL CHATURVEDI JUDICIAL MEMBER ACCOUNTANT MEMBER / PUNE; / DATED : 21 ST FEBRUARY, 2020 . SB / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(APPEALS) - 2, PUNE. 4. THE PR. CIT - 2, PUNE. 5 . , , , / DR, ITAT, B BENCH, PUNE. 6 . / GUARD FILE. // TRUE COPY // / BY ORDER, / PRIVATE SECRETARY , / ITAT, PUNE . 5 ITA NO. 1795 /PUN/20 17 A.Y. 2010 - 11 DATE 1 DRAFT DICTATED ON 19 .02.2020 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 19 . 0 2 .20 20 SR.PS/PS 3 DRAFT PROPOSED AND PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER AM/JM 5 APPROVED DRAFT COMES TO THE SR. PS/PS SR.PS/PS 6 KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7 DATE OF UPLOADING OF ORDER SR.PS/PS 8 FILE SENT TO BENCH CLERK SR.PS/PS 9 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 10 DATE ON WHICH FILE GOES TO THE A.R 6 ITA NO. 1795 /PUN/20 17 A.Y. 2010 - 11 11 DATE OF DISPATCH OF ORDER