M/s. Nirmala Devlopers, Baroda V. The Income tax Officer,Ward-5(1), Baroda

ITA 27/AHD/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 89542 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 5 month(s) 4 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-06-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 24-04-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 04-01-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L KUREEL
• Assessee Lawyers: S N SOPARKAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD BEFORE SHRI PRAMOD KUMAR ACCOUNTANT MEMBER AND SHRI S.S. GODARA JUDICIAL MEMBER ITA NO . 27 /AHD/ 201 3 A. Y. 200 8 - 0 9 M/S. NIRMALA DEVELOPERS C/O MANISH SHAH & ASSO. 101 - 38, GAUTAM NAGAR, BARODA. PAN: AAEFN 7293C VS ITO, WARD - 5(1), BARODA. (APPELLANT) (RESPONDENT) REVENUE BY : S HRI P.L. KUREEL , SR. D.R. , ASSESSEE(S) BY : SHRI S.N. SOPARKAR , A.R. / DATE OF HEARING : 2 4 / 0 4 /201 5 / DATE OF PRONOUNCEMENT: 9 / 0 6 /201 5 / O R D E R PER SHRI S.S. GODARA , JUDICIAL MEMBER TH IS ASSESSEE S APPEAL FOR A.Y. 200 8 - 0 9 , ARISE S FROM ORDER OF THE CI T(A) - V BARODA DATED 15 .11 . 20 12 PASSED I N CASE NO . CAB/(A)V - 143/10 - 11 , UPHOLDING THE ASSESSING OFFICER S FINDING DISALLOWING ITS CLAIM OF SECTION 80IB(10) DEDUCTION OF RS.1,02,00,421/ - , IN PROCEEDINGS U/S. 143 ( 3 ) OF THE INCOME TAX ACT IN SHORT THE ACT . 2. THE ASSESSEE - FIRM FILED ITS RETURN ON 2.7.2008 SHOWING NIL INCOME AFTER CLAIMING THE IMPUGNED SECTION 80IB(10) OF RS.1,02,00,421/ - . THE ASSESSING OFFICER IN COURSE OF A REGULAR ITA NO. 27 /AHD/201 3 M/S. NIRMALA DEVELOPERS . FOR A.Y. 200 8 - 0 9 - 2 - ASSESSMENT FRAMED ON 19.11.2010 OBSERVED THAT THE ASSESSEE WAS NOT OWNER OF THE LAND SUBJECT TO MATTER OF THE RESIDENTIAL PROJECT IN QUESTION NOR IT HAD ITSELF OBTAINED BUILDING PLAN APPROVAL FROM THE LOCAL AUTHORITY, THE LAND OWNER HAD ALREADY SOLD RESIDENTIAL UNITS IN THE PROJECT L A ND TO UNIT HOLDER AND THE ASSESSEE HAD ONLY ACTED AS A CONFIRMING PARTY, ITS ROLE WAS MERELY THAT OF A CONTRACTOR EXECUTING CONSTRUCTION AGREEMENT WITH THE UNIT HOLDERS AND IT HAD NEVER SOLD THE RESIDENTIAL HOUSES IN QUESTION TO THE ULTIMATE BUYERS BY WAY OF REGISTERED DOCUMENTS; FOR DISALLOWING THE DEDUC TION IN QUESTION. 3. THE CIT(A) HAS EXPRESSED AGREEMENT WITH THE ASSESSING OFFICER S FINDINGS FOR REJECTING THE ASSESSEE S APPEAL. 4. WE HAVE HEARD BOTH SIDES AND GONE THROUGH THE CASE FILE. THE SOLE QUESTION INVOLVED IN THE PRESENT IS THAT OF ASSESSEE S CLAIM OF SECTION 80IB(10) DEDUCTION AMOUNTING TO RS.1,02,00,421/ - RELATING O GAYATRI KRUPA TENEMENTS PROJECT IN VADODARA. THE REVENUE STRONGLY SUPPORTS THE CIT(A) S ORDER. THE RELEVANT FACTS ALREADY STAND NARRATED HEREINABOVE ALONG WITH THE LOWER AUTHO RITIES REASONS FOR REFUSING THE IMPUGNED DEDUCTION. THEY HOLD THAT THE ASSESSEE IS NOT THE OWNER OF THE LAND AND THE PROJECT APPROVAL HAD BEEN OBTAINED IN THE NAME OF THIRD PARTY. THE CASE FILE READS THAT IT HAS SUBMITTED TO BE THE OWNER OF THE LAND AS PE R THE PARTNERSHIP DEED AND SALE DEED AND ONLY THE APPROVAL HAD BEEN IN THE NAME OF THE ORIGINAL OWNER FROM WHOM ITS PARTNERS HAD PURCHASED THE LAND IN VIEW OF THE FACT THAT THERE WAS NO REQUIREMENT OF A REVISED APPROVAL. PAGE 34 OF THE ITA NO. 27 /AHD/201 3 M/S. NIRMALA DEVELOPERS . FOR A.Y. 200 8 - 0 9 - 3 - PAPER BOOK CONTAININ G THE ASSESSEE S SUBMISSION BEFORE THE ASSESSING AUTHORITIES DEMONSTRATES THESE FACTS. THERE IS ALSO NO FINDING FORTHCOMING IN THE ASSESSMENT ORDER OR LOWER APPELLATE ORDER THAT THE ASSESSEE HAS NOT BORNE RISK AND RESPONSIBILITY IN THE HOUSING PROJECT STAT E D HEREINABOVE. T HE HON BLE JURISDICTION HIGH COURT IN CIT VS. RADHEY DEVELOPERS (2012) 341 ITR 403 HOLDS THAT OWNERSHIP OF LAND IS NOT A CONDITION PRECEDENT FOR DEVELOPING IT UNDER A HOUSING PROJECT AS PER THE GUJARAT TOWN PLANNING AND CONTROL REGULATIONS . THIS OVER RULES THE REVENUE S FIRST TWO SUBSTANTIVE OBJECTIONS. THE LATTER THREE REASONS OF EXECUTION OF SEPARATE SALE DEEDS ETC (SUPRA) ARE TAKEN CARE OF BY A CO - ORDINATE BENCH (SAME COMBINATION) IN ITA 532/AHD/2013 PUSPAK DEVELOPER VS. DCIT DECIDED ON 28.4.2015 AS UNDER: 6. WE SEE NO REASON TO TAKE ANY OTHER VIEW THAN THE VIEW TAKEN BY THE CO ORDINATE BENCH IN THE CASE OF NARAYAN REALTY LTD. VS. DCIT AND OTHER CASES RELIED UPON IN THE SAID DECISION. IN THE PRESENT CASE ALSO, IT IS UNDISPUTED FACT THAT THE ASSESSEE WAS RESPONSIBLE FOR INCURRING ALL THE EXPENSES AND TAKING ALL THE RISKS INVOLVED IN THIS VENTURE. THE MERE FACT THAT THE ASSESSEE DID NOT OWN THE LAND AND THE MERE FACT THAT THE SALE DEED EXECUTED IN FAVOUR OF THE END BUYER WAS A TRIPARTITE AG REEMENT SHOWING SALE BY THE LAND OWNER AND CONSTRUCTION HAVING BEEN DONE BY THE ASSESSEE DOES NOT NEGATE THE FACT THAT THE ASSESSEE WAS CARRYING ON THE BUSINESS ENTREPRENEUR RATHER THAN A CONTRACTOR SIMPLICITER. IN THIS VIEW OF THE MATTER AND RESPECTFULLY FOLLOWING THE DECISION OF CO - ORDINATE BENCH, WE HOLD THAT THE ASSESSEE WAS ENTITLED TO DEDUCTION UNDER SECTION 80IB(10) AMOUNTING TO RS.4,71,720/ - . WE ACCORDINGLY DIRECT THE ASSESSING OFFICER TO GRANT THE SAME. THE ASSESSEE GETS THE RELIEF ACCORDINGLY. T HE REVENUE FAILS TO POINT OUT ANY DISTINCTION OF FACTS OR QUOTE JUDICIAL PRECEDENT TO THE CONTRARY. THUS , WE ACCEPT THE ASSESSEE S ITA NO. 27 /AHD/201 3 M/S. NIRMALA DEVELOPERS . FOR A.Y. 200 8 - 0 9 - 4 - CONTENTION AND HOLD IT ENTITLE FOR IMPUGNED SECTION 80IB(10) DEDUCTION OF RS.1,02,00,421/ - . 5. THE ASSESSEE S APPEAL IS ALLO WED. ORDER PRONOUNCED IN THE COURT ON THIS DAY, THE 9 TH JUNE , 201 5 AT AHMEDABAD. S D/ - SD/ - ( PRAMOD KUMAR ) ( S.S. GODARA ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATE D / 0 4 / 20 1 5 PRABHAT KR. KESARWANI , SR. P . S . / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / CONCERNED CIT 4. ( ) / THE CIT(A) - III, AHMEDABAD 5. , , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD