ITO WD 3(2), KALYAN V. PARESH CONSTRUCTION CO, THANE

ITA 3595/MUM/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 71023 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 3 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-09-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 03-09-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 21-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DEEPAK KUMAR SINHA
• Keywords: Reassessment proceedings
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C , BENCH , MUMBAI , BEFORE SHRI R.K.GUPTA , J M & SHRI R AJENDRA SINGH , A M TA NO. 3595 / MUM / 20 1 2 ( ASSESSMENT YEAR : 2004 - 05 ) ITO WD 3(2) , KALYAN VS. M/S PARESH CONSTRUCTION CO., A/18, SAMARTH NAGAR, BARAVE ROAD, KALYAN(W) - 421 301 PAN/GIR NO. : A ABFP 5209 K ( APPELLANT ) .. ( RESPONDENT ) /REVENUE BY : SHRI DEEPAK KUMAR SINHA /ASSESSEE BY : NONE DATE OF HEARING : 3 RD S E PTEMBER , 201 3 DATE OF PRONOUNCEMENT : 6 TH SEPTEMBER , 2013 O R D E R P ER SHRI R.K.G UPTA, JM : THE DEPARTMENT HAS PREFERRED THIS APPEAL AGAINST THE ORDER OF LEARNED CIT(A) , MUMBAI FOR ASSESSMENT YEAR 2004 - 05 . 2 . THE DEPARTMENT IN ITS APPEAL HAS RAISED OBJECTION IN REGARD TO DELETING THE ADDITION O F RS. 23,04,267/ - DISALLOWED BY THE AO CLAIMED BY THE ASSESSEE UNDER SECTION 80IB(10). 3 . DURING THE ORIGINAL ASSESSMENT PROCEEDING, THE AO DISALLOWED THE DEDUCTION CLAIMED UNDER SECTION 80IB(10) OF THE ACT VIDE ORDER DATED 21 - 12 - 2006. THE CIT(A) CONFIRMED THE DISALLOWANCE, HOWEVER, THE TRIBUNAL SET ASIDE THE MATTER AGAIN TO THE FILE OF THE AO TO CONSIDER THE DECISION OF THE SPECIAL BENCH IN THE CASE OF BRAHMA ASSOCIATES & OTHERS, DECIDED IN ITA NO. 690/M/2008 , VIDE ORDER DATED 6 - 5 - 2009 I TA NO. 3595 /1 2 2 AND THEN DECIDE THE M ATTER AFRESH. DURING THE REASSESSMENT PROCEEDINGS, THE AO EXAMINED THE DIRECTION OF THE TRIBUNAL ALONG WITH FACTS OF THE CASE AND FOUND THAT THE COMMERCIAL AREA WAS 3190 SQ.FT. OUT OF TOTAL AREA OF 59852 SQ.FT.. THUS, THE RESIDENTIAL AREA WAS 94.67% I.E. M ORE THAN THE 90% LIMIT PRESCRIBED BY THE TRIBUNAL IN CASE OF BRAHMA ASSOCIATES & OTHERS (SUPRA) . ACCORDINGLY, THE AO AGAIN DISALLOWED THE DEDUCTION UNDER SECTION 80IB(10) AT RS. 23,04,267/ - . 4 . ASSESSEE PREFERRED APPEAL BEFORE THE CIT(A) . DETAILED SUBMIS SIONS WERE FILED BEFORE THE CIT(A) , WHICH ARE INCORPORATED IN THE ORDER OF THE CIT(A) AT PAGE 4. LEARNED CIT(A) AFTER CONSIDERING THE SUBMISSION FOUND THAT THE APPEAL OF THE ASSESSEE IS LIABLE TO BE ALLOWED IN PART. THE CIT(A) NOTED THAT IN VIEW OF THE DEC ISION OF SPECIAL BENCH IN THE CASE OF BRAHMA ASSOCIATES & OTHERS (SUPRA) , THE ASSESSEE IS ENTITLED TO DEDUCTION UNDER SECTION 80IB(10) RELATING TO RESIDENTIAL PORTION OF THE HOUSING PROJECT ON PROPORTIONATE BASIS BECAUSE EVEN AFTER EXCLUDING THE BUILT UP A REA UNDER COMMERCIAL UNITS , THE ASSESSEE SATISFIES THE CONDITIONS OF SECTION 80IB(10) OF THE ACT. ACCORDINGLY, THE AO WAS DIRECTED TO RECOMPUTE THE DEDUCTION UNDER SECTION 80IB IN VIEW OF THE DECISION OF THE SPECIAL BENCH IN THE CASE OF BRAHMA ASSOCIATES & OTHERS (SUPRA) . NOW, THE DEPARTMENT IS IN APPEAL HERE BEFORE THE TRIBUNAL. 5. LEARNED DR PLACED RELIANCE ON THE ORDER OF AO. I TA NO. 3595 /1 2 3 6 . NONE APPEARED ON BEHALF OF THE ASSESSEE. HENCE, APPEAL IS HEARD AND DISPOSED OF AFTER CONSIDERING THE ORDER OF AO AND LEARNE D CIT(A) . 7 . AFTER CONSIDERING THE ORDER OF AO AND CIT(A) , WE FIND THAT THE CIT(A) HAS DECIDED THE ISSUE IN THE LIGHT OF THE DECISION OF THE SPECIAL BENCH IN THE CASE OF BRAHMA ASSOCIATES & OTHERS (SUPRA ). THE DECISION OF THE SPECIAL BENCH HAS BEEN CONFI RMED BY THE HON BLE BOMBAY HIGH COURT ALSO BY WHICH THE HONBLE BOMBAY HIGH COURT HAS APPROVED THAT THE PROPORTIONATE DEDUCTION HAS TO BE ALLOWED AS HELD BY THE SPECIAL BENCH OF THE TRIBUNAL. THE FINDINGS OF THE CIT(A) HAS BEEN RECORDED IN PARA 4, WHICH AR E AS UNDER : - 4. I HAVE CAREFULLY CONSIDERED THE FACTS ON RECORDS AS WELL AS A SUBMISSION OF THE APPELLANT INCLUDING THE CASE LAWS RELIED UPON BY HIM. I FIND THAT THE HON BLE ITAT IN THE CASE OF APPELLANT HAS SET ASIDE THE ASSESSMENT ORDER TO BE REFRAMED AFRESH IN THE LIGHT OF GUIDELINES LAID DOWN BY THE HON BLE SPECIAL BENCH OF ITAT PUNE IN THE CASE OF M/S BRAHMA ASSOCIATES & ORS. (SUPRA) . THE A.O. WHILE EXAMINING THE FACTS OF THE CASE AS ALSO THE GUIDELINES LAID DOWN BY THE HON BLE ITAT IN THE CASE OF M /S BRAHMA ASSOCIATES & OTHERS HAS ALSO FOUND THAT THE HOUSING PROJECT WAS APPROVED AS A RESIDENTIAL AS WELL AS COMMERCIAL PROJECT AND BUILT UP AREA OF RESIDENTIAL PORTION WAS 94.67% I.E. MORE THAN THE LIMIT PRESCRIBED BY THE HON BLE ITAT AT 90%. THEREFORE , THE A.O. HAS ALSO CONCLUDED THAT IF THE CASE OF M/S BRAHMA ASSOCIATES & OTHERS IS STRICTLY FOLLOWED, THEN THE APPELLANT FIRM IS ELIGIBLE FOR DEDUCTION U/S. 80IB(10) OF THE ACT. HOWEVER, SINCE THE DEPARTMENT HA S NOT ACCEPTED THE DECISION OF THE HONBLE IT AT IN THE CASE OF M/S BRAHMA ASSOCIATES &OTHERS, THE AO DISALLOWED THE DEDUCTION CLAIMED UNDER SECTION 80IB(10) OF THE ACT. I FIND THAT PRESENT ORDER IS IN THE NATURE OF AN ORDER GIVING EFFECT TO THE ORDER OF HONBLE ITAT AND HENCE HAS BEEN PASSED U/S. 143 (3) R.W.S. 254 OF THE ACT. THEREFORE, THE EFFECT TO THE ORDER OF HON BLE ITAT IS TO BE GIVEN FULLY IRRESPECTIVE OF THE FACT THAT AS TO WHETHER FURTHER APPEAL HAS BEEN FILED OR NOT. THUS, IN VIEW OF DECISION OF HON BLE ITAT IN THE CASE OF M/S BRAHMA ASSOCIA TES &OTHERS (SUPRA ) , THE APPELLANT IS ENTITLED TO THE DEDUCTION U/S.80IB(10) RELATING TO THE RESIDENTIAL PORTION OF THE HOUSING PROJECT ON PROPORTIONATE BASIS BECAUSE EVEN AFTER EXCLUDING THE BUILT UP AREA UNDER COMMERCIAL UNITS, THE APPELLANT SATISFIES TH E CONDITIONS OF SECTION 80IB(10) OF THE ACT. THE AO IS I TA NO. 3595 /1 2 4 DIRECTED ACCORDINGLY. SINCE, ALL THE GROUNDS OF APPEAL ARE DIRECTED TOWARDS THE DISALLOWANCE OF DEDUCTION U/S.80IB OF THE ACT, THE SAME ARE PARTLY ALLOWED. THE FINDINGS OF THE LEARNED CIT(A) REMAINED UNCONTROVERTED AS THE LEARNED DR HAS PLACED RELIANCE ON THE ORDER OF AO. THEREFORE, WE SEE NO REASON TO INTERFERE IN THE FINDINGS OF LEARNED CIT(A) BECAUSE THE LEARNED CIT(A) HAS DECIDED THE ISSUE FOLLOWING THE DECISION OF THE SPECIAL BENCH IN THE CASE OF BRAHMA ASSOCIATES & OTHERS (SUPRA) , WH ICH HAS BEEN APPROVED BY THE HONBLE BOMBAY HIGH COURT ALSO. ACCORDINGLY, WE CONFIRM THE FINDINGS OF THE LEARNED CIT(A). 8 . RESULTANTLY , APPEAL OF THE DEPARTMENT IS DISMISSED . ORDER PRONOUNCED IN THE OPEN COURT ON THIS 6 TH DAY OF SEPT . 201 3 . SD/ - ( ) ( R AJENDRA SINGH ) S D/ - ( ) ( R.K.GUPTA ) / ACCOUNTANT MEMBER / JUDICIAL MEMBER MUMBAI ; DATED : 06 / 09 / 2013 /PKM , PS COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. / THE C I T(A) , MUMBAI . 4. / C I T 5. / DR, ITAT, MUMBAI . 6. GUARD FILE. //TRUE COPY// / BY ORDER, ( /ASSTT. REGISTRAR) / ITAT, MUMBAI