The ACIT, Central Circle-1, Baroda V. M/s. Shree Developers, Baroda

ITA 2284/AHD/2009

• Counselvise Citation: 228420514 RSA 2009
• Duration Of Justice: 4 year(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-08-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 25-07-2013
• Assessment Year: 2001-2002
• Appeal Filed On: 23-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: O P BATHEJA
• Assessee Lawyers: VIJAY RANJAN
• Section: 234B

Judgement Text

, , , , A, IN THE INCOME TAX APPELLATE TRIBUNAL AT AHMEDABAD, A BENCH . .. . . .. . , !' !' !' !', , , , #$ #$ #$ #$ # ## #. .. .% %% % . .. .&'( &'( &'( &'(, , , , %) * %) * %) * %) * % ' % ' % ' % ' BEFORE S/SHRI G.C. GUPTA, VICE-PRESIDENT AND A. K. GARODIA, ACCOUNTANT MEMBER) ITA NO.2284 AND 2285/AHD/2009 WITH CO NO.193 AND 194/AHD/2011 [ASSTT.YEAR : 2001-2002 AND 2002-2003] ACIT, CC-1, BARODA. /VS. M/S.SHREE DEVELOPERS VITTHAL PARK, B/H. YOGESHWAR SOCIETY TARSALI, BARODA. ( (( (,- ,- ,- ,- / APPELLANT) ( (( (./,- ./,- ./,- ./,- / RESPONDENT) * 0 1 %/ REVENUE BY : SHRI O.P. BATHEJA, SR.DR 34 0 1 %/ ASSESSEE BY : SHRI VIJAY RANJAN 5 0 46)/ DATE OF HEARING : 25 TH JULY, 2013 7&8 0 46)/ DATE OF PRONOUNCEMENT : 02-08-2013 %9 / O R D E R PER GARODIA, ACCOUNTANT MEMBER: BOTH THESE APPEALS ARE FILED BY THE REVENUE AND BOTH THE COS. BY THE ASSES SEE, WHICH ARE DIRECTED AGAINST TWO SEPARATE ORDERS OF THE LEARNED CIT(A)-IV, AHMEDABAD BOTH DATED 13.1.2009 FOR THE ASSESSMENT Y EAR 2001-02 AND 2002-2003. SINCE ISSUE INVOLVED IS COMMON, ALL THE SE APPEALS WERE HEARD TOGETHER, AND ARE BEING DISPOSED OF BY THIS C OMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. AS PER THE GROUNDS RAISED BY THE REVENUE IN ITS APPEAL FOR THESE TWO YEARS, ONLY GRIEVANCE OF THE REVENUE IS REGARDI NG DELETION OF DISALLOWANCE MADE BY THE AO UNDER SECTION 80IB(10) OF RS.79,92,483/- ITA NO.2284 AND 2285/AHD/2009 WITH CO NO.193 AND 194/AHD/2011 -2- IN A.Y.2001-02 AND RS.26,89,692/- IN A.Y.2002-2003. AS PER THE CO FILED BY THE ASSESSEE, THE GRIEVANCE OF THE ASSESSE E IS THAT IT WAS NOT A FIT CASE FOR INVOKING THE PROVISION OF SECTION 153C OF THE ACT. APART FROM THIS, THE ASSESSEE IS DISPUTING REGARDING THE INTER EST CHARGED BY THE AO UNDER SECTION 234B OF THE ACT. 3. FIRST, WE TAKE UP THE APPEALS FILED BY THE REVEN UE. IN THIS REGARD, THE LEARNED DR OF THE REVENUE SUPPORTED THE ASSESSM ENT ORDER, WHEREAS THE LEARNED COUNSEL FOR THE ASSESSEE SUPPORTED THE ORDER OF THE LEARNED CIT(A). THE LEARNED AR HAS RELIED ON THE ORDER OF THE HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF CIT VS. RADHE DE VELOPERS, 341 ITR 403. HE ALSO SUBMITTED THAT A COMPARATIVE CHART RE GARDING THE FACTS IN THE CASE OF RADHE DEVELOPERS (SUPRA) AND THE FACTS OF T HE PRESENT CASE, BRING HOME THIS POINT THAT ALL THE MAJOR FACTS ARE SIMILA R, IF NOT IDENTICAL, AND HENCE, THIS JUDGMENT OF THE HONBLE GUJARAT HIGH CO URT IS SQUARELY APPLICABLE IN THE PRESENT CASE. 4. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD AND ORDERS OF THE AUTHORITIES BELOW, AND ALS O THE JUDGMENT OF THE HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF RADHE DEVELOPERS (SUPRA). AS PER THE ASSESSMENT ORDER, WE FIND TH AT THIS WAS THE MAIN OBJECTION OF THE AO IN BOTH THE YEARS THAT THE ASSE SSEE IS NOT A LAND OWNER, AND THEREFORE, IT HAS TO BE ACCEPTED THAT TH E ASSESSEE IS MERELY A CONTRACTOR TO WORK ON BEHALF OF THE LAND OWNER. NO W ON THIS ISSUE, THE JUDGMENT OF THE HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF RADHE DEVELOPERS (SUPRA) IS AVAILABLE, WHEREIN, IT WAS HELD BY THE HONBLE HIGH COURT THAT THE OWNERSHIP OF THE LAND I S NOT A PRE-REQUISITE AND THE CONDITION WHICH IS TO BE SEEN IS THAT THE A SSESSEE MUST BE HAVING A DOMINANT CONTROL OVER THE PROPERTY IN QUESTION, AND THE ASSESSEE MUST BE ITA NO.2284 AND 2285/AHD/2009 WITH CO NO.193 AND 194/AHD/2011 -3- TAKING RISK AND SHOULD BE ELIGIBLE FOR REWARD. ENG LISH VERSION OF DEVELOPMENT AGREEMENT IS AVAILABLE AT PAGE NO.48 TO 57 OF THE PAPER BOOK. AS PER PAGE NO.50 OF THE PAPER BOOK, IT IS S EEN THAT LAND OWNERS HAVE DETERMINED VALUE OF ENTIRE LAND OWNED BY THEM TO THE EXTENT OF 13,051 SQ.METER AT RS.7,02,145/- AT THE RATE OF RS. 5/- PER SQUARE FEET, AND THIS AMOUNT HAS ALREADY BEEN RECEIVED BY THE LAND O WNERS, AS PER THE DEVELOPMENT AGREEMENT ON THE DATE OF EXECUTION OF T HE DEVELOPMENT AGREEMENT DATED 19.11.1999, AND THEY WERE REQUIRED TO EXECUTE THE SALE DEED, WHENEVER THE ASSESSEE DESIRES WITHOUT ANY TIM E LIMIT. THIS GOES TO SHOW THAT IT MAY BE THAT LEGAL TITLE OF THE LAND IN QUESTION WAS NOT IN THE NAME OF THE ASSESSEE, BUT REAL AND BENEFICIAL OWNER SHIP OF THE LAND IN QUESTION WAS WITH THE ASSESSEE ONLY, AND LEGAL TITL E OWNERS WERE ONLY ELIGIBLE FOR FIXED AMOUNT TOWARDS VALUE OF THE LAND OF RS.7,02,145/-, WHICH WAS ALREADY PAID BY THE ASSESSEE TO SUCH LEGA L TITLE HOLDERS OF THE LAND. UNDER THESE FACTS, IT HAS TO BE ACCEPTED THA T REAL OWNER OF THE LAND WAS THE ASSESSEE ONLY, AND HENCE, FOR THE DEVELOPME NT OF THE PROJECT, THE ENTIRE RISK AND REWARD WAS VESTED WITH THE ASSESSEE ONLY. THE OBJECTIONS OF THE AO DO NOT SURVIVE BECAUSE IN THE FACTS OF TH E PRESENT CASE, THE ASSESSEE WAS THE REAL AND BENEFICIAL OWNER OF THE L AND IN QUESTION. IN LIGHT OF THESE FACTS, THE ISSUE IN DISPUTE IS SQUAR ELY COVERED IN FAVOUR OF THE ASSESSEE BY THE JUDGMENT OF THE HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF RADHE DEVELOPERS (SUPRA), AND RESPEC TFULLY FOLLOWING THE SAME, WE DECLINE TO INTERFERE IN THE ORDER OF THE L EARNED CIT(A) ON THIS ISSUE IN BOTH THE YEARS. 5. IN THE RESULT BOTH THE APPEALS OF THE REVENUE AR E DISMISSED. 6. NOW WE TAKE UP COS OF THE ASSESSEE. ITA NO.2284 AND 2285/AHD/2009 WITH CO NO.193 AND 194/AHD/2011 -4- 7. THE ASSESSEE HAS RAISED THE ISSUE OF INVOCATION OF THE PROVISION OF SECTION 153C OF THE ACT AND CHARGING OF INTEREST UN DER SECTION 234B BY THE AO. SINCE WE HAVE ALREADY DISMISSED THE APPEA LS OF THE REVENUE FOR BOTH THE YEARS AND DECIDED THE ISSUE ON MERIT IN FA VOUR OF THE ASSESSEE, THE ISSUES RAISED IN THESE COS. ARE OF ACADEMIC INT EREST ONLY, AND DO NOT REQUIRE ANY SEPARATE ADJUDICATION, HENCE DISMISSED ACCORDINGLY. 8. IN COMBINED RESULT, BOTH THE APPEALS OF THE REVE NUE AND BOTH THE COS. OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE. SD/- SD/- ( . .. . . .. . /G.C. GUPTA) !' !' !' !' /VICE-PRESIDENT ( # ## #. .. .% %% % . .. .&'( &'( &'( &'( /A.K. GARODIA) %) * /ACCOUNTANT MEMBER VK* C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER DR/AR, ITAT, AHMEDABAD