Sh. Vijay Kumar Gupta, New Delhi V. ITO, New Delhi

ITA 2253/DEL/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6917 (ITAT-DELHI)
• Duration Of Justice: 5 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-09-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC 1
• Next Hearing Date: 28-09-2016
• Assessment Year: 2011-2012
• Appeal Filed On: 27-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : SMC-I : NEW DELHI BEFORE SHRI R.S. SYAL, ACCOUNTANT MEMBER ITA NO.2253/DEL/2016 ASSESSMENT YEAR : 2011-12 SHRI VIJAY KUMAR GUPTA, JP-2, 3 RD FLOOR, PITAM PURA, NEW DELHI. PAN: AAEPG5124H VS. ITO, WARD-25(1), NEW DELHI. (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : SHRI RAJESH KUMAR, SR. DR DATE OF HEARING : 28.09.2016 DATE OF PRONOUNCEMENT : 28.09.2016 ORDER THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER PASSED BY THE CIT(A) ON 1.2.2016 IN RELATION TO THE ASSESS MENT YEAR 2011-12. 2. THE ONLY ISSUE RAISED IN THIS APPEAL IS AGAIN ST THE CONFIRMATION OF DISALLOWANCE OF RS.7,72,147/-. ITA NO.2253/DEL/2016 2 3. BRIEFLY STATED, THE FACTS OF THE CASE ARE THAT THE ASSESSEE SOLD HIS 2.5 STOREY BUILT UP PROPERTY SITUATED AT A-29, SECTOR-1 9, ROHINI, DELHI FOR A TOTAL CONSIDERATION OF RS.55 LAC. THIS 180 SQ. MTR DDA PLOT WAS PURCHASED BY THE ASSESSEE ON 6.6.1997 WHICH WAS LAT ER ON CONSTRUCTED THREE STOREYS DURING THE FINANCIAL YEAR 1999-2000 FOR A CONSIDERATION OF RS.23,92,500/-. THE SAME WAS AGAIN RENOVATED IN THE FINANCIAL YEAR 2004- 05 FOR A SUM OF RS.1,75,500/-. THE AO REQUIRED THE ASSESSEE TO EXPLAIN AS TO HOW CONSTRUCTION AND RENOVATION EXPENSES WERE CL AIMED AS DEDUCTION IN ENTIRETY AS INCURRED FOR THREE STOREYS, WHEREAS THE PROPERTY SOLD WAS ONLY 2.5 STOREYS AS PER THE SALE DEED. NOT CONVINC ED WITH THE ASSESSEES CONTENTION, HE PROPORTIONATELY REDUCED CONSTRUCTION EXPENSES OF STOREY BY A SUM OF RS.7,72,147 FOR WHICH DISALLOWANCE WAS MADE. THE LD. CIT(A) AFFIRMED THE ADDITION. 4. I HAVE HEARD THE LD. DR AND PERUSED THE RELEVAN T MATERIAL ON RECORD. THERE IS NO APPEARANCE FROM THE SIDE OF THE ASSESSE E. REQUEST FOR ADJOURNMENT HAS BEEN REJECTED AS THIS APPEAL INVOLV ES ONLY A TRIVIAL ISSUE. 5. IT IS APPARENT FROM THE SUBMISSIONS MADE BY THE ASSESSEE BEFORE THE LD. CIT(A) THAT: THE ENTIRE PROPERTY WITH ALL FREEHOLD RIGHTS OF THE LAND ITA NO.2253/DEL/2016 3 ALONG WITH THE WHOLE OF THE CONSTRUCTED STRUCTURE WAS PAS SED ON TO THE PURCHASER OF THE SAID PROPERTY. I FAIL TO APPRECIATE THE VI EW TAKEN BY THE AUTHORITIES BELOW IN DISALLOWING PROPORTIONATE EXPE NSES FOR STOREY WHEN THE ASSESSEE DID NOT RETAIN ANY PART OF THE BUILDIN G AND TRANSFERRED THE ENTIRE STRUCTURE. THIS WAS ALSO SUBMITTED BEFORE T HE AO, WHO SIMPLY CHOSE TO IGNORE THE SAME BY NOTICING THAT IN THE SA LE DEED THE PROPERTY TRANSFERRED WAS 2.5 STOREYS WHEREAS THE ASSESSEE HA D THREE STOREYS. IT IS OBVIOUS THAT WHEN THE ENTIRE PROPERTY IS TRANSFERRE D, THERE CANNOT BE ANY QUESTION OF REDUCING THE COST OF CONSTRUCTION/RENOV ATION ON A HYPER TECHNICAL GROUND. UNDER SUCH CIRCUMSTANCES, I HOLD THAT THE AUTHORITIES BELOW ERRED IN MAKING AND SUSTAINING DISALLOWANCE O F RS.7,72,147/-. THE SAME IS, THEREFORE, DELETED. 6. IN THE RESULT, THE APPEAL IS ALLOWED. THE ORDER PRONOUNCED IN THE OPEN COURT ON 28.09.20 16. SD/- [R.S. SYAL] ACCOUNTANT MEMBER DATED, 28 TH SEPTEMBER, 2016. DK ITA NO.2253/DEL/2016 4 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR, ITAT AR, ITAT, NEW DELHI.