Chase Buildcone Projects Pvt. Ltd., Ahmedabad V. The Income Tax Officer, Ward-1(3), Ahmedabad

ITA 3185/AHD/2015

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9146 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-03-2016
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 14-12-2015
• Assessment Year: 2011-2012
• Appeal Filed On: 06-11-2015
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Revenue expenditure

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI SHAILENDRA K. YADAV, JUDICIAL MEMBER ./ ITA NO. 3185/AHD/2015 / ASSESSMENT YEAR: 2011-12 CHASE BUILDCONE PROJECTS PVT LTD, C/O. MEHTA LODHA & CO, CAS 105, SAKAR-1, NR. GANDHIGRAM RAILWAY STATION, ASHRAM ROAD, AHMEDABAD .. APPELLANT PAN : AABCP 1832 B VS INCOME TAX OFFICER, WARD-1 (3), AHMEDABAD .. RESPONDENT ASSESSEE(S) BY : SHRI PRAKASH D. SHAH , AR REVENUE BY : SHRI DILEEP KUMAR , SR - DR / DATE OF HEARING 14/12/2015 /DATE OF PRONOUNCEMENT 22/03/2016 / O R D E R THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-1, AHME DABAD, DATED 31.07.2015 FOR ASSESSMENT YEAR 2011-12, ON TH E FOLLOWING GROUNDS. 1. THAT THE LEARNED CIT(A) HAS ERRED IN LAW AND FA CTS BY CONFIRMING THE DISALLOWANCE OF RS.7,00,000/- ON ACC OUNT OF BUSINESS DEPOSIT MADE BY THE LEARNED AO AND THEREFO RE THE LEARNED AO SHOULD BE DIRECTED TO DELETE THE DISALLO WANCE OF RS.7,00,000/- 2. THAT THE APPELLANT CRAVES LIBERTY TO ADD, AMEND , ALTER AND DELETE ANY GROUNDS OF APPEAL BEFORE THE FINAL H EARING. (SMC) ITA NO. 3185/AHD/2015 CHASE BUILDCONE PROJECTS PVT LTD VS. ITO AY : 2011-12 2 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSES SING OFFICER DISALLOWED AN AMOUNT OF RS.7,00,000/- WHICH WAS CLA IMED BY THE ASSESSEE AS LOSS ON FORFEITURE FOR THE YEAR U NDER CONSIDERATION. ON APPEAL, THE CIT(A) HAS CONFIRMED THE SAME. 2.1 THE STAND OF THE ASSESSEE HAS BEEN THAT A BUSIN ESS ADVANCE OF RS.7,00,000/- WAS GIVEN TO DEBT RECOVERY TRIBUNAL (IN SHORT DRT) FOR ACQUIRING THE PROPERTY FOR THE D EVELOPMENT, IN AUCTION BEFORE THE DRT, IN THE NAME OF JOINT CO-OWN ER BUT THE REFUND AMOUNT WAS RECEIVED BY THE JOINT CO-ACQUIRER . THE JOINT CO-OWNER HAS NOT REFUNDED THE DEPOSIT AMOUNT OF THE MONEY TO THE COMPANY AND THEREFORE, THE AMOUNT BECA ME NON- RECOVERABLE AND WHICH HAS BEEN WRITTEN OFF IN THE B OOKS OF ACCOUNTS OF THE COMPANY. THE ASSESSEE SUBMITTED TH AT ADVANCE TO THE DRT WAS FOR THE PURPOSE OF THE BUSIN ESS OF THE COMPANY AND THE AMOUNT COULD NOT RECOVERED FROM THE JOINT CO-OWNER AND THEREFORE, IT WAS A BUSINESS LOSS AND IS ALLOWABLE AS DEDUCTION U/S 28/37(1) OF THE INCOME-TAX ACT. T HESE CONTENTIONS OF THE ASSESSEE WERE NOT ACCEPTED BY TH E REVENUE AUTHORITIES AS THE DRT HAS RETURNED THE MARGIN MON EY TO SHRI SHAILESH PATEL. IT IS ALSO OBSERVED BY THE CIT(A) THAT THE ASSESSEE AND SHRI SHAILESH PATEL TOGETHER HAS DEPOS ITED AN AMOUNT OF RS.22.5 LACS AS MARGIN MONEY FOR THE AUCT ION TO BE CONDUCTED BY THE DRT. FROM THESE FACTS, THE CIT(A) OBSERVED THAT DRT HAS REFUNDED THE FULL MONEY OF RS.22.5 LA CS WHICH IS NOT DISPUTED BY THE ASSESSEE. THE ASSESSEE CLAIMED THAT SHRI (SMC) ITA NO. 3185/AHD/2015 CHASE BUILDCONE PROJECTS PVT LTD VS. ITO AY : 2011-12 3 SHAILESH PATEL HAD NOT GIVEN THE AMOUNT OF RS.7 LAC S WHICH WAS CONTRIBUTED BY HIM AS MARGIN MONEY BEFORE THE DRT F OR THE AUCTION. THIS FACT HAS NOT BEEN DISPUTED BY THE ASS ESSEE. IN THIS BACKGROUND, THE CIT(A) OBSERVED THAT THE MONEY HAS BEEN REFUNDED BY THE DRT AND THUS COULD NOT BE SAID THAT DRT HAS FORFEITED THE AMOUNT. THERE IS NOTHING ON RECORD TO SUGGEST THAT THE ASSESSEE CAN CLAIM THE AMOUNT IN QUESTION AS RE VENUE EXPENDITURE. IF SHRI SHAILESH PATEL HAS NOT REFUND ED THE MONEY, THERE IS NOTHING ON RECORD TO SHOW THAT THE ASSESSEE HAS TAKEN ANY EFFORT TO GET IT BACK. IN ABSENCE OF ANY EFFORT IN THIS REGARD, THE REVENUE AUTHORITIES WERE JUSTIFIED IN DISALLOWING THE CLAIM OF THE ASSESSEE OF RS.7 LACS AS REVENUE EXPENDITURE. THEREFORE, THE ORDER OF THE CIT(A) IS UPHELD. 3. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 22ND MARCH, 2016 A T AHMEDABAD. SD/- ( SHAILENDRA K. YADAV ) JUDICIAL MEMBER AHMEDABAD; DATED 22/03/2016 BIJU T., PS / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! ' ' # / CONCERNED CIT 4. ' ' # ( ) / THE CIT(A) 5. &'( ! , ' ! , / DR, ITAT, AHMEDABAD 6. (- . / GUARD FILE. / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) !', / ITAT, AHMEDABAD