M/S PARMAR PROPERTIES PVT. LTD, Pune V. DCIT,Cir.4, Pune

ITA 234/PUN/2009

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9307 (ITAT-PUNE)
• Duration Of Justice: 8 year(s) 4 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2017
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 28-04-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 16-02-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE , , BEFORE MS. SUSHMA CHOWLA, JM AND SHRI ANIL CHATURVEDI, AM . / ITA NO. 234 /P U N/20 09 / ASSESSMENT YEAR : 20 0 3 - 0 4 M/S. PARMAR PROPERTIES PVT. LTD., OFFICE NO.2A, WING 1, THAKER HOUSE, 2418, EAST STREET, PUNE - 411001 . / APPELLANT PAN: AABCP1016F VS. THE DY. COMMISSIONER OF INCOME TAX, CIRCLE 4, PUNE . / RESPONDENT . / ITA NO. 569 /P U N/20 09 / ASSESSMENT YEAR : 20 0 4 - 0 5 M/S. PARMAR PROPERTIES PVT. LTD., OFFICE NO.2A, WING 1, THAKER HOUSE, 2418, EAST STREET, PUNE - 411001 . / APPELLANT PAN: AABCP1016F VS. THE INCOME TAX OFFICER (TECH) - II, PUNE . / RESPONDENT CORRIGENDUM IN ITA NO. 234 /P U N/20 09 ITA NO.569/PUN/2009 M/S. PARMAR PROPERTIES PVT. LTD. 2 CORRIGENDUM PER SUSHMA CHOWLA, JM: THE ASSESSEE VIDE ITS APPLICATION DATED 31.05.2017 REQUESTED FOR ISSUANCE OF CORRIGENDUM IN THE CAPTIONED APPEAL AS SOME MISTAKES HAD CREPT IN THE ORDER OF TRIBUNAL . ON PERUSAL OF THE SAME, IT REFLECTS THAT SOME MISTAKES HAVE BEEN CREPT IN THE CAPTIONED APPEAL AND HENCE, THIS CORRIGENDUM. 2 . IN PARA 12 AT PAGE 14 WHILE REFERRING TO THE DISPUTED AR EA IN LI LL Y - I, IT WAS MENTIONED THAT B1 AREA CONSTITUTED OF BASEMENT WHICH WAS MORE THAN 1500 SQ.FT. AND WAS THE SHOPPING AREA AND THE ASSESSEE WAS NOT CLAIMING ANY DEDUCTION IN RESPECT OF THE SAME. HOWEVER, IN RESPECT OF OTHER UNITS IN LI LL Y - I, THE CLAIM OF DEDUCTION UNDER SECTION 80IB(10) OF THE ACT WAS NOT WITHDRAWN . SO, WHILE PASSING THE ORDER FOLLOWING MISTAKE CREPT IN THE ORDER OF TRIBUNAL AND FOR WHICH, WE ARE ISSUING THE FOLLOWING CORRIGENDUM. 39. NOW, COMING TO THE NEXT ASPECT OF DENIAL OF DEDU CTION TO THE ASSESSEE BY THE ASSESSING OFFICER AND CONFIRMED BY THE CIT(A) IS THAT THE ASSESSEE HAS (A) NOT CONSTRUCTED THE UNITS AS PER SANCTIONED BUILDING PLAN; (B) THE AREA OF RESIDENTIAL FLATS CONSTRUCTED BY THE ASSESSEE IS MORE THAN 1500 SQ.FT.; ND ( C) MANY FLATS HAVE BEEN MERGED TOGETHER AND THE TOTAL AREA OF THE FLATS IS MORE THAN 1500 SQ.FT. AND ALSO THE ASSESSEE HAS VIOLATED THE CONDITIONS OF THE BUILDING PLANS SANCTIONED BY CONVERTING THE RESIDENTIAL UNITS INTO COMMERCIAL UNITS AND CONSEQUENTLY, OCCUPYING THE AREA MORE THAN 1500 SQ.FT. THE PERUSAL OF ORDERS OF ASSESSING OFFICER CORRIGENDUM IN ITA NO. 234 /P U N/20 09 ITA NO.569/PUN/2009 M/S. PARMAR PROPERTIES PVT. LTD. 3 AND THE CIT(A) WOULD SHOW THAT EXTENSIVE EXERCISE HAS BEEN CARRIED OUT BY THEM TO ESTABLISH THE VIOLATION OF BUILDING B1 AND C3, WHEREIN THERE IS VIOLATION OF NOT ONLY USA GE BUT ALSO THE AREA OCCUPIED. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE AT THE OUTSET POINTED OUT THAT DESPITE THE STAND OF ASSESSEE BEFORE THE AUTHORITIES BELOW, BUT THE ASSESSEE IS WITHDRAWING ITS CLAIM OF DEDUCTION UNDER SECTION 80IB(10) OF THE ACT IN RESPECT OF BASEMENT AREA OF B1 AND ENTIRE C3 , THE ASSESSEE HAS AGREED THAT THE TOTAL AREA ON MERGER WAS MORE THAN STIPULATED AREA OF 1500 SQ.FT. AND HENCE, THE ASSESSEE WAS NOT ENTITLED TO CLAIM THE AFORESAID DEDUCTION. 3. FURTHER, CONSEQUE NT CHANGES HAVE TO BE MADE IN PARA S 43 AND 44 OF ORDER OF TRIBUNAL AS UNDER: - 43. THE LAST ASPECT OF THE ISSUE RAISED IN THE PRESENT APPEAL IS THE AREA OF FLAT. THE DEDUCTION CLAIMED UNDER SECTION 80IB(10) OF THE ACT HAS BEEN DENIED TO THE ASSESSEE FOR VIOLATION OF CONDITIONS OF CLAUSE (C) OF SECTION 80IB(10) OF THE ACT I.E. BUILT UP AREA. VARIOUS FACETS HAVE BEEN LOOKED INTO BY THE AUTHORITIES BELOW I.E. JOINING OF FLATS, ROW - HOUSES, STATEMENT RECORDED OF THE PURCHASERS, ETC. THE ASSESSING OFFICER ALS O DIRECTED THE DVO TO INSPECT AND SUBMIT A REPORT OF THE BUILT UP AREA. THE DVO ON THE BASIS OF BUILDING PLANS AND WITHOUT PHYSICAL VERIFICATION IN ASSESSMENT YEAR 2003 - 04 GAVE A REPORT THAT THE BUILT UP AREA OF THE FLATS WAS MORE THAN 1500 SQ.FT. THE DV O ALSO CONSIDERED THE SALE AGREEMENTS EXECUTED BY THE ASSESSEE WITH THE INTENDED PURCHASERS. THE EXPLANATION OF THE ASSESSEE IN THIS REGARD WAS THAT THE SALE AGREEMENT TALK ABOUT THE SUPER CORRIGENDUM IN ITA NO. 234 /P U N/20 09 ITA NO.569/PUN/2009 M/S. PARMAR PROPERTIES PVT. LTD. 4 BUILT UP AREA I.E. THE SALEABLE AREA WHICH IS DIFFERENT FROM THE C OVERED AREA. IT WAS ALSO STRESSED BY THE ASSESSEE BEFORE THE ASSESSING OFFICER THAT THE DVO HAD NOT CARRIED OUT ANY PHYSICAL VERIFICATION EXERCISE BY WAY OF PHYSICALLY VERIFYING THE AREA WITHIN BOUNDARIES OF INDIVIDUAL RESIDENTIAL FLATS WHETHER MERGED OR NOT. THE CLAIM OF ASSESSEE WAS THAT EXCEPT FOR BASEMENT AREA OF B1 AND ENTIRE C3 , ALL THE OTHER UNITS WERE FULFILLING THE CONDITIONS OF BEING LESS THAN 1500 SQ.FT. THE ASSESSING OFFICER DID NOT ACCEPT THE PLEA OF ASSESSEE IN THE INSTANT ASSESSMENT YEAR A ND HELD THE ASSESSEE TO HAVE VIOLATED THE CONDITIONS OF CLAUSE (C) OF SECTION 80IB(10) OF THE ACT AND DENIED THE DEDUCTION TO THE ASSESSEE. SIMILAR PLEA WAS MADE BY THE ASSESSEE IN THE SUCCEEDING YEAR I.E. ASSESSMENT YEAR 2004 - 05 AND THE ASSESSING OFFICER DIRECTED THE SAME DVO TO FILE PHYSICAL VERIFICATION REPORT OF THE CONSTRUCTED RESIDENTIAL FLATS. THE DVO HAS SUBMITTED THE REPORT, UNDER WHICH IT IS REPORTED THAT THE AREA OF FLATS WAS LESS THAN 1500 SQ.FT. HOWEVER, THE CIT(A) DID NOT ADOPT THE SAID REP ORT SINCE IN THE PRECEDING YEAR, THIS ISSUE WAS DECIDED AGAINST THE ASSESSEE. 4 . THE NEXT MISTAKE POINTED OUT BY THE ASSESSEE IS IN THE FINAL DIRECTIONS OF TRIBUNAL IN PARA 44 AT PAGE 43, WHEREIN THE ASSESSING OFFICER WAS DIRECTED TO VERIFY WHETHER THE R ESIDENTIAL UNITS FULFILL THE CONDITIONS LAID DOWN IN SECTION 80IB(10) OF THE ACT OF HAVING BUILT UP AREA OF 1500 SQ.FT. THE DISPUTED FLATS WERE IN BUILDING A1 (TULIP), C1 AND C2 (MARIGOLD) AND THAT WAS THE ISSUE ADJUDICATED BY THE ASSESSING OFFICER AND TH E CIT(A) AND WAS BEFORE US. SO, AMENDED PARA 44 AT PAGE 43 WOULD READ AS UNDER: - CORRIGENDUM IN ITA NO. 234 /P U N/20 09 ITA NO.569/PUN/2009 M/S. PARMAR PROPERTIES PVT. LTD. 5 44. THE LEARNED AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE BEFORE US HAS PLEADED THAT PHYSICAL VERIFICATION EXERCISE OF MEASUREMENT OF FLATS IN BUILDINGS A - 1, C - 1 AND C - 2 I .E. WITHIN BOUNDARIES OF THE FLATS AND NOT THE SUPER BUILT UP AREA CAN BE VERIFIED BY THE ASSESSING OFFICER BY DIRECTING THE DVO AND AFTER THE VERIFICATION, THE CLAIM OF ASSESSEE MAY BE LOOKED INTO AND DECIDED ON THE BASIS OF SAID VERIFICATION. IN THE TOT ALITY OF THE ABOVE SAID FACTS AND CIRCUMSTANCES OF THE CASE AND BECAUSE OF CONFLICTING REPORTS OF DVO IN THE TWO YEARS I.E. ASSESSMENT YEARS 2003 - 04 AND 2004 - 05, WE FIND MERIT IN THE PLEA OF THE ASSESSEE. AS PER THE PROVISIONS OF THE STATUTE IN THE RELEVA NT YEARS, IT IS THE AREA WITHIN FOUR BOUNDARIES WHICH HAS TO BE TAKEN INTO CONSIDERATION AND IF THE SAME IS UP TO 1500 SQ.FT., THEN THE ASSESSEE IS ENTITLED TO AVAIL THE DEDUCTION, IN CASE IT EXCEEDS 1500 SQ.FT., THEN THE DEDUCTION TO SUCH UNITS CAN BE DEN IED. THE DENIAL OF DEDUCTION UNDER SECTION 80IB(10) OF THE ACT IS UNIT - WISE. IN OTHER WORDS, THE ASSESSEE IS ENTITLED TO PRORATA DEDUCTION UNDER SECTION 80IB(10) OF THE ACT IN RESPECT OF ALL THOSE RESIDENTIAL UNITS IN BUILDINGS A1, C1 AND C2 WHICH FULFIL L THE CONDITIONS LAID DOWN IN THE SECTION OF HAVING BUILT UP AREA UPTO 1500 SQ.FT. ACCORDINGLY, THE ASSESSING OFFICER IS DIRECTED TO VERIFY THE CLAIM OF ASSESSEE OF RESIDENTIAL UNITS IN BUILDINGS A1, C1 AND C2 THROUGH THE DVO AND AFTER AFFORDING REASONABL E OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSING OFFICER IS ALSO DIRECTED TO ALLOW PRORATA DEDUCTION UNDER SECTION 80IB(10) OF THE ACT TO THE ASSESSEE IN RESPECT OF SUCH RESIDENTIAL UNITS IN BUILDINGS A1, C1 AND C2 WHICH FULFILL THE CONDITIONS. AL L THE OTHER UNITS WHICH DO NOT FULFILL THE CONDITIONS OF AREA OF 1500 SQ.FT. ARE NOT ENTITLED TO THE SAID DEDUCTION. WE HOLD SO. THE BASEMENT AREA IN B1 AND ENTIRE C3 BUILDING ADMITTEDLY, HAVE NOT FULFILLED CORRIGENDUM IN ITA NO. 234 /P U N/20 09 ITA NO.569/PUN/2009 M/S. PARMAR PROPERTIES PVT. LTD. 6 THE CONDITIONS AND ARE NOT ELIGIBLE FOR DEDUCTI ON. ACCORDINGLY, GROUNDS OF APPEAL RAISED BY THE ASSESSEE VIS - - VIS DEDUCTION CLAIMED UNDER SECTION 80IB(10) OF THE ACT ARE PARTLY ALLOWED. THE BALANCE ORDER SHALL REMAIN UNCHANGED. SD/ - SD/ - ( ANIL CHATURVEDI ) (SUSHMA CHOWLA) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE ; DATED : 23 RD JUNE , 201 7 . GCVSR / COPY OF THE ORDER IS FORWARDED TO : 1. / THE APPEL LANT ; 2. / THE RESPONDENT; 3. ( ) / THE CIT (A) - I I , PUNE ; 4. / THE CIT - II , PUNE ; 5. , , / DR A , ITAT, PUNE; 6. / GUARD FILE . / BY ORDER, // TRUE COPY // / ASSISTANT REGISTRAR, , / ITAT, PUNE