DCIT., Central Circle-2(1), Hyderabad, Hyderabad V. M/s Ashoka Developers & Builders Limited, Hyderabad

ITA 1906/HYD/2014

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0344 (ITAT-HYDERABAD)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-04-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 19-12-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: RAJAT MITRA
• Assessee Lawyers: K C DEVADAS

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER I.T.A. NO. 1906/HYD/2014 ASSESSMENT YEAR: 2011-12 DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-2(1) HYDERABAD VS M/S.ASHOKA DEVELOPERS & BUILDERS LTD., BANJARA HILLS, HYDERABAD [PAN: AAECA4442R] (APPELLANT) (RESPONDENT) FOR REVENUE : SHRI RAJAT MITRA, DR FOR ASSESSEE : SHRI K.C.DEVADAS, AR DATE OF HEARING : 07 - 0 4 - 201 5 DATE OF PRONOUNCEMENT : 17 - 04 - 2015 O R D E R PER B. RAMAKOTAIAH, A.M. : THIS IS A REVENUE'S APPEAL AGAINST THE ORDER OF TH E COMMISSIONER OF INCOME TAX(APPEALS)-VII, HYDERABAD DATED 22-10-2 014. THE ISSUE INVOLVED IN REVENUE'S APPEAL IS WITH REFERENCE TO A DDITION OF RS.54,74,728/- MADE TOWARDS THE RATE DIFFERENCE ON SALE CONSIDERATION FOR VILLAS SOLD DURING THE YEAR DELETED BY CIT(A). I.T.A. NO. 1906/HYD/2014 M/S.ASHOKA DEVELOPERS & BUILDERS LTD :- 2 -: 2. ASSESSEE HAD SOLD CERTAIN VILLAS CONSTRUCTED BY IT AND ASSESSING OFFICER [AO] NOTICED THAT THE RATE AT WHICH ASSESSE E HAS SOLD VARIED FROM RS.1,842/- PER SQ. FT., TO RS.3,046/- PER SQ. FT.. WHILE ACCEPTING THAT IN THE EARLIER YEAR, AO DETERMINED THE AVERAGE SALE PR ICE AT RS.2,592/- PER SQ. FT., AND THIS YEAR IT HAS COME DOWN TO RS.2,248 /- AO, HOWEVER, TOOK THE AVERAGE RATE OF THE SALE PRICE AND ARRIVED AT T HE DIFFERENCE OF RS.54,47,728/- ON SIX VILLAS WHICH WERE SOLD AT A P RICE LESSER THAN AVERAGE RATE, THEREBY MAKING ADDITION. LD.CIT(A) F OLLOWING THE DECISION OF THE ITAT AND CIT(A)-2 FOR THE ASSESSMENT YEAR 20 10-11, DELETED THE ADDITION, HENCE REVENUE IS IN APPEAL. 3. IT WAS CONTENDED THAT THE FACTS ARE ENTIRELY DIF FERENT FROM THE EARLIER YEARS AND HUGE VARIATION IN RATES OF VILLAS ARE NOT POSSIBLE IN THE SAME GATED COMMUNITY. LD.COUNSEL, HOWEVER, RELIED ON THE ORDERS OF THE CO-ORDINATE BENCH FOR THE AY.2010-11, WHEREIN I TAT DELETED THE ADDITION HOLDING THAT THERE IS NO EVIDENCE BROUGHT ON RECORD BY THE AO TO SHOW THAT ANY EXTRA CONSIDERATION OUTSIDE THE BO OKS OF ACCOUNTS OR BEYOND THE VALUE GIVEN IN THE RELEVANT AGREEMENTS W HETHER RECEIVED BY ASSESSEE FROM THE PURCHASES OF THE VILLAS. IT WAS ALSO NOTED BY THE ITAT THAT ADDITION ON ACCOUNT OF ALLEGED SUPPRESSION OF SALE PROCEEDS WAS MADE ON THE SAME BASIS AS IN EARLIER YEARS. 4. WE HAVE CONSIDERED THE ISSUE AND EXAMINED THE FA CTS ON RECORD. ITAT IN THEIR ORDERS FROM AY.2008-09 TO 2009-10 IN ITA NO.937/HYD/2013 DT. 28-03-2014, DELETED THE ADDITIO N BASED ON SRO, VALUES. FOLLOWING THAT IN AY.2010-11, THE ITAT VID E ITA NO.1315/HYD/2014 DT. 14-11-2014, DELETED THE ADDITI ON. THE MATERIAL FACTS FOR THE ISSUE ARE SAME IN ALL THE YEARS. THE REFORE, CIT(A) IS CORRECT IN DELETING THE AMOUNT AS THERE IS NO BASIS FOR MAK ING ADDITION. SURPRISINGLY IN THIS YEAR, THE AO HAS TAKEN THE ASS ESSEE'S OWN SALE PRICE I.T.A. NO. 1906/HYD/2014 M/S.ASHOKA DEVELOPERS & BUILDERS LTD :- 3 -: RECORDED IN THE BOOKS OF ACCOUNTS AND ARRIVED AT AV ERAGE RATE AND MADE ADDITION OF ONLY SIX VILLAS WHICH ARE SOLD FOR A PR ICE LESS THAN THE AVERAGE RATE. WE ARE UNABLE TO UNDERSTAND HOW THE AO COULD WORK OUT SUPPRESSION OF PRICE ON THE BASIS OF THE ENTRIES IN THE BOOKS OF ACCOUNTS. MOREOVER, AO HAS NO POWER TO ARRIVE AT THE SALE PRI CE ON ASSUMPTIONS AND PRESUMPTIONS, THERE BEING NO EVIDENCE THAT ASSE SSEE HAS INDEED SUPPRESSED THE SALE PROCEEDS. 5. IN VIEW OF THIS, WE DO NOT FIND ANY MERIT IN THE REVENUE'S GROUNDS. ACCORDINGLY, THE APPEAL IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 17 TH APRIL, 2015 SD/- SD/- (ASHA VIJAYARAGHAVAN) (B. RAMA KOTAIAH) JUDICIAL MEMBER ACC OUNTANT MEMBER HYDERABAD, DATED 17 TH APRIL, 2015 TNMM I.T.A. NO. 1906/HYD/2014 M/S.ASHOKA DEVELOPERS & BUILDERS LTD :- 4 -: COPY TO : 1. DY. COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE - 2(1), 3 RD FLOOR, POSNETT BHAVAN, RAMKOTE, TILAK ROAD, HYDERA BAD. 2. M/S. ASHOKA DEVELOPERS & BUILDERS LTD., #8-2-120/112/P/7, 3 RD FLOOR, PARK VIEW ESTATE, ROAD NO.2, BANJARA HILLS, HYDERABAD. 3. CIT(APPEALS)-VII, HYDERABAD 4. CIT(CENTRAL), HYDERABAD 5. D.R. ITAT, HYDERABAD