M/s. Rasayana Hotel, New Delhi V. ITO, Uttrakhand

ITA 2717/DEL/2017

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 7832 (ITAT-DEHRADUN)
• Duration Of Justice: 4 year(s) 6 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-11-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 02-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Rule of consistency; Set aside
• Section: 143(3); 80IC; 80IC; 153C

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN BENCH, DEHRADUN BEFORE SHRI R.K. PANDA, ACCOUNTANT MEMBER AND SHRI V.P. RAO, JUDICIAL MEMBER ITA No. 2717/Del/2017 Assessment Years: 2010-11 Rasayana Hotel, 26/6, vs. Income-tax Officer, East Patel Nagar, New Delhi. Tehri, Hq. Rishikesh. PAN : AAKFR2179K (Appellant) (Respondents) Appellant by : Sh. P.C. Yadav, Advocate Respondent by: Sh. N.S. Jangpangi, CIT/DR Date of hearing: 24.11.2021 Date of order : 24.11.2021 ORDER PER V.P. RAO, J.M.: This appeal by the assessee is directed against the order dated 28.02.2017 of CIT(A) for the assessment year 2010-11.The assessee has raised following grounds : “1. That on facts and circumstances of the case, the order passed u/s 153C by Ld. CIT(Appeal) is bad in the eyes of law and on facts. 2. On the facts and under the circumstances of the case the order of AO is bad in law as no satisfaction u/s 153C of the Act has been recorded by the AO of search person before handling over the material pertaining to the assessee. 2 3. The Order of AO as upheld by the CIT(A) is not tenable as requisite conditions prescribed under section 153C has not been followed before assuming jurisdiction of section 153C of the Act 4. That on facts and circumstances of the case, the order passed by Ld. CIT(Appeal) is bad in the eyes of law and on facts as the assessment order passed u/s 153C itself is invalid and liable to be quashed as there was no incriminating material belonging to the assessee being found during the search. 5. On the facts and circumstances of the case, the order u/s 153C being passed in violation of the principle of natural justice and without giving adequate time and opportunity to the assessee to represent its case and to file its replies and clarification, is bad in the eye of law and liable to be quashed. 6. That the Ld. CIT(A) has erred on facts and in law in making an addition of Rs. 43,59,476/- on account of disallowance of deduction u/s 80IC of the Income Tax Act, 1961. 7. That the Ld. CIT(A) has erred on facts and in law in making the impugned addition by not treating hotel business as a component or part and parcel of ‘Eco- Tourism’ activity/project 8. That the impugned addition is not sustainable as the same is already been made in the order U/s 143(3) of the Income Tax Act, 1961 vide order dated 25.03.2013 which is subject matter of appeal before ITAT New Delhi in ITA No. 3071/2015. 9. That the impugned appellate order is arbitrary, illegal, bad in law and in violation of rudimentary principles of contemporary jurisprudence.” 2. At the time of hearing, learned AR of the assessee stated at the outset that the only issue in this appeal is arising out of the disallowance of deduction u/s. 80IC of the Income-tax Act. He has pointed out that this issue was considered and decided by this 3 Tribunal in assessee’s own case for the assessment year 2010-11 vide order dated 11.10.2017. Thus, he has pleaded that this issue is covered in favour of the assessee by the decision of this Tribunal in assessee’s own case and therefore, the claim of the assessee may be allowed. 3. On the other hand, ld. DR has relied upon the orders of the authorities below. 4. Having considered the rival submissions as well as relevant material on record, we note that an identical issue has been considered by this Tribunal in assessee’s own case for the assessment year 2010-11 in ITA No. 3071/Del/2015 vide order dated 11.10.2017 in paragraph No. 9 & 10 as under : “9. I have heard the rival contentions and perused the facts of the case. I have also gone through the cited decisions and of the considered opinion that the appeal of the assessee deserves to beallowed for the following reasons: a) Assessee is registered under the Sana Act, as is evident from page 60 of the PB. The hotels registered under the Saria Act are exempt from obtaining certificate from the Pollution Control Board. b) Further, the Uttarakhand High Court has restored the matter to the Assessing Officer to verify whether the defacto assessee in that case was taking care of environment or not. The relevant observations of the Uttarakhand High Court at para 36 and 37 in the case of Anchal Hotels are as under: “Even regarding the sites of the activities, we would think it must have something to do with areas close to nature. No doubt, in the State of Uttarakhand, the area of natural beauty and areas close to nature, often overlapped in close proximity with developed areas. These are all matters we would leave to the authority. In view of the same, the order of the tribunal cannot be sustained and the matter must be redone. Accordingly, the impugned orders in all these cases will stand set aside. 4 A request is made by the learned counsel for the Assessee Officer. Learned counsel for the revenue Mr. H.M. Bhatia does not object to this course of action. In such circumstances, in view of the fact that the matter must be redone, we set aside the impugned orders. The matter is remanded back to the Assessing Officer, who will afford opportunity to all the Assessees and pass fresh orders taking note of the observations, which we have made. “The answer to the substantial question of law no. 1 is given in favour of the revenue/appellant by holding that merely because a No Objection Certificate has been obtained from the Pollution Control Board, the conditions under Section 80-lC will not fulfilled.” c) From the images of hotel annexed at paper book pages 37 to 46 it is abundantly clear that the hotel of the assessee was in direct proximity with nature. Hence the observation of the Hon’ble Uttarakhand High Court in Anchal Hotels [supra] completely fulfilled in the present case. Further, assessee in his submissions before the Id. CIT(A), copy placed in paper book at pages 1 to 11 pointed out the following facts. i) The area wherein the hotel is located is a beautiful terrain. ii) Hotels is clearly approved by Tourism officer and this fact is not controverted either by the Assessing Officer or by the Id. CIT(A). iii) It has not even been shown that the assessee was required to specifically obtain certificate from the Pollution Control Board or which has been obtained by other hotels and not by the assessee. iv) Assessee has used water and electricity effectively. For this purpose, assessee has used CFL for lighting purpose and solar heaters for heating water. All these things conserve electricity. v) Assessee has taken various measures to reduce the generation of waste and recycle the waste for its reusability. Revenue has allowed all the expenses in respect of these activities. vi) Sufficient rain water harvesting measures are taken by the hotel for efficient utilisation of rain water. vii) Hotel is situated in a hilly area and has created employment in that area due to which the area has become economically viable. d) In view of the above facts and circumstances of the case, the Id. counsel for the assessee has contended that the hotel fulfils al the conditions of eco-tourism. 10. In that view of the matter, I am of the considered view that the assessee fulfils all the conditions and hence benefit of section 80IC are hereby 5 allowed to the assessee. The Assessing Officer is directed to allow the deduction amounting to Rs. 43,59,476/- u/s 80IC of the Act.” 5. Accordingly, to maintain the rule of consistency, we follow the earlier order of this Tribunal in assessee’s own case and decide the issue in favour of the assessee. The claim of the assessee qua this issue is allowed. 6. In the result, the appeal of the assessee is allowed. Order pronounced in the open court on 24 th day of November, 2021 after conclusion of virtual hearing. Sd/- Sd/- (R.K. PANDA) (V.P. RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 24/11/2021 ‘aks’