DCIT, CHENNAI V. Sterling Estates and Properties Ltd., CHENNAI

ITA 2531/CHNY/2014

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 8976 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 8 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 23-05-2016
• Assessment Year: 2007-2008
• Appeal Filed On: 07-10-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR MILIND MADHUKAR BHUSARI
• Assessee Lawyers: K BALASUBR AMANIAN
• Keywords: Reopening of assessment
• Section: 80IB; 148

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D' BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.2531/MDS/2014 / ASSESSMENT YEAR : 2007-08 THE DY. COMMISSIONER OF INCOME TAX COMPANY CIRCLE VI(4) CHENNAI VS. M/S STERLING ESTATES AND PROPERTIES LTD STERLING POINT NO.124, G.N CHETTY ROAD, T. NAGAR, CHENNAI 600 017 [PAN AAFCS 3024 E ] ( &' / APPELLANT) ( ()&' /RESPONDENT) / APPELLANT BY : DR. MILIND MADHUKAR BHUSARI, CIT /RESPONDENT BY : SHRI K. BALASUBRAMANIAN, ADVOCATE / DATE OF HEARING : 23 - 0 5 - 2016 ! / DATE OF PRONOUNCEMENT : 23 - 0 6 - 2016 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE REVENUE IS DIRECTED AGAINST T HE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-VI, CHENN AI, DATED 23.6.2014 AND PERTAINS TO ASSESSMENT YEAR 2007-08. 2. DR. MILIND MADHUKAR BHUSARI, LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSEE CLAIMED DEDUCTION U/S ITA NO. 2531/14 :- 2 -: 80IB(10) OF THE ACT. INITIALLY, THE ASSESSING OFFI CER ALLOWED THE CLAIM OF THE ASSESSEE U/S 80IB(10) OF THE ACT. SUBSEQU ENTLY, DUE TO AMENDMENT OF SEC. 80IB(10) WITH EFFECT FROM 1.4.200 5, THE ASSESSING OFFICER REOPENED THE ASSESSMENT BY ISSUING NOTICE U/S 148 OF THE ACT ON 21.3.2012. THE CIT(A) BY FOLLOWING THE ORDER OF THIS TRIBUNAL FOR ASSESSMENT YEAR 2006-07 FOUND THAT THE AMENDMENT BR OUGHT IN SEC. 80IB IS NOT APPLICABLE IN RESPECT OF THE PROJECT AP PROVED BEFORE 1.4.2005. IN THIS CASE, THE PROJECT WAS APPROVED B Y THE LOCAL AUTHORITIES ON 19.12.2003, THEREFORE, THE CIT(A) FO UND THAT THE CLAIM OF THE ASSESSEE CANNOT BE DISALLOWED SINCE THE PRO JECT WAS APPROVED BEFORE 1.4.2005. THE LD. DR FURTHER POINTED OUT TH AT THE CIT(A) HAS ALSO FOUND THAT REOPENING OF ASSESSMENT IS ALSO BAD IN LAW. ON A QUERY FROM THE BENCH, THE LD. DR CLARIFIED THAT THE ASSESSMENT WAS REOPENED BY THE ASSESSING OFFICER ONLY BECAUSE OF T HE AMENDMENT CARRIED OUT IN SEC. 80IB(10) OF THE ACT WITH EFFEC T FROM 1.4.2005. ON A FURTHER QUERY FROM THE BENCH WHETHER THE ASSESSE E COULD ANTICIPATE THE AMENDMENT THAT MAY BE BROUGHT IN BY THE PARLIAM ENT IN FUTURE WHILE FILING THE RETURN OF INCOME FOR THE YEAR UNDE R CONSIDERATION, THE LD. DR VERY FAIRLY SUBMITTED THAT HE LEAVE THE MATT ER TO THE DISCRETION OF THE BENCH. ITA NO. 2531/14 :- 3 -: 3. ON THE CONTRARY, SHRI K. BALASUBRAMANIAN, LD. COUNS EL FOR THE ASSESSEE SUBMITTED THAT THE ASSESSEE FILED THE RET URN OF INCOME IN THE REGULAR COURSE CLAIMING DEDUCTION U/S 80IB(10) OF THE ACT AS PER THE LAW PREVALENT ON THE FIRST DAY OF THE FINANCIAL YEA R. THE ASSESSING OFFICER, IN FACT, ALLOWED THE CLAIM OF THE ASSESSE E U/S 80IB(10) OF THE ACT. SUBSEQUENTLY, THE PARLIAMENT AMENDED SEC. 80I B(10) WITH EFFECT FROM 1.4.2005. TO GIVE EFFECT TO THE AMENDMENT MAD E BY THE PARLIAMENT, THE ASSESSING OFFICER REOPENED THE ASSE SSMENT BY ISSUING NOTICE U/S 148. THIS BENCH OF THIS TRIBUNAL EXAMI NED THE AMENDMENT BROUGHT IN BY THE PARLIAMENT IN THE ASSESSEES OWN CASE IN I.T.A.NO.2146/MDS/2012 FOR THE ASSESSMENT YEAR 2006 -07. THIS TRIBUNAL FOUND THAT SINCE THE ASSESSEES HOUSING P ROJECT WAS APPROVED ON 19.12.2003 BEFORE THE AMENDMENT OF SEC. 80IB(10) , THE AMENDED PROVISION IS NOT APPLICABLE FOR THE PRESENT PROJECT OF THE ASSESSEE. THE LD. COUNSEL FURTHER SUBMITTED THAT THE ASSESSE E COULD NOT ANTICIPATE THE AMENDMENT THAT MAY BE BROUGHT IN BY THE PARLIAMENT IN FUTURE. THEREFORE, THE AMENDMENT BROUGHT IN SUBSEQ UENT TO THE FILING OF THE RETURN OF INCOME CANNOT BE A REASON TO REOPE N THE ASSESSMENT. THEREFORE, THE CIT(A) HAS RIGHTLY FOUND THAT THE RE OPENING OF ASSESSMENT IS ALSO BAD IN LAW. ITA NO. 2531/14 :- 4 -: 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. THE ASSESSEE IS ENGAGED IN DEVELOPMENT OF HOUSING PROJECT WHICH IS ELIGIBLE FOR DEDUCTION U/S 80IB(10) OF THE ACT. THE PROJECT OF THE ASSESSEE WAS APPROVED BY THE LOCAL AUTHORITIES ON 19.12.2003. I N FACT, THE ASSESSING OFFICER ALLOWED THE DEDUCTION CLAIMED U/S 80IB(10)OF THE ACT ON THE BASIS OF THE ORIGINAL RETURN FILED BY THE A SSESSEE. THE DISPUTE ARISES AFTER THE AMENDMENT CARRIED OUT BY THE PARLI AMENT IN SEC. 80IB(10) WITH EFFECT FROM 1.4.2005. AS RIGHTLY SUB MITTED BY THE LD. COUNSEL FOR THE ASSESSEE, THE ASSESSEE IS NOT EXPEC TED TO ANTICIPATE AN AMENDMENT THAT MAY BE BROUGHT IN BY THE PARLIAMENT IN FUTURE. WHEN THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S 80IB(1 0) OF THE ACT ON THE BASIS OF LAW WHICH IS EXISTENT ON THE FIRST DAY OF THE FINANCIAL YEAR, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CLAI M CANNOT BE DISALLOWED MERELY BECAUSE A SUBSEQUENT AMENDMENT WA S BROUGHT IN BY THE PARLIAMENT. THEREFORE, AS RIGHTLY FOUND BY THIS TRIBUNAL IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2006-07 IN RESPECT OF THE HOUSING PROJECT WHICH WAS APPROVED BEFORE 1.4.2005, THE PROVISIONS OF SEC. 80IB(10) AS BROUGHT IN BY THE PARLIAMENT WITH EFFECT FROM 1.4.2005 IS NOT APPLICABLE. THEREFORE, THIS TRIBUN AL DO NOT FIND ANY ITA NO. 2531/14 :- 5 -: REASON TO INTERFERE WITH THE ORDER OF THE LOWER AUT HORITY. ACCORDINGLY, THE SAME IS CONFIRMED. 5. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DI SMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 23 RD JUNE, 2016, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 23 RD JUNE, 2016 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF