BHOOMI REALTORS, MUMBAI V. ACIT 15(3), MUMBAI

ITA 3654/MUM/2017

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3572 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 5 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-10-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2011-2012
• Appeal Filed On: 19-05-2017
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AJAY MALLIK
• Keywords: TDS
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B, MUMBAI BEFORE SHRI VIKAS AWASTHY, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER ITA NO.3654/MUM/2017(A.Y. 2011-12) M/S. BHOOMI REALTORS, 106, SHREEPAL INDUSTRIAL ESTATE, S.V.ROAD, JOGESHWARI(WEST), MUMBAI 400 095 PAN: AAAAB33440J ...... APPELLANT VS. ACIT-15(3), R.NO.122, 1 ST FLOOR, MATRU MANDIR, MUMBAI 400 007 ..... RESPONDENT ITA NO.4114/MUM/2017(A.Y. 2011-12) DCIT, CEN.CIR.6(2), R.NO.1903, 19 TH FLOOR, AIR INDIA BUILDING, NARIMAN POINT, MUMBAI 400 021. .... APPELLANT VS. M/S. BHOOMI REALTORS, 106, SHREEPAL INDUSTRIAL ESTATE, S.V.ROAD, JOGESHWARI(WEST), MUMBAI 400 095 PAN: AAAAB33440J ...... RESPONDENT ASSESSEE BY : SHRI MAHAVEER JAIN REVENUE BY : SHRI AJAY MALLIK DATE OF HEARING : 11/09/2019 DATE OF PRONOUNCEMENT : 31/10/2019 2 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) ORDER PER VIKAS AWASTHY, JM: THESE CROSS APPEALS BY THE ASSESSEE AND REVENUE ARE DIRECTED AGAINST THE ORDER OF CIT(A) -41, MUMBAI DATED 29/03 /2017 FOR THE ASSESSMENT YEAR 2011-12. 2. IN BRIEF, THE FACTS OF THE CASE AS AVAILABLE FRO M RECORDS ARE: THE ASSESSEE IS A BUILDER AND DEVELOPER. THE ASSE SSEE(AOP) FILED ITS RETURN OF INCOME FOR THE IMPUGNED ASSESSMENT YEAR O N 30/09/2011 DECLARING TOTAL INCOME OF RS.32,01,092/-. THE AS SESSEE CLAIMED DEDUCTION UNDER SECTION 80 IB(10) OF THE INCOME TAX ACT, 1961 ( IN SHORT THE ACT) OF RS.5,92,49,118/- IN RESPECT OF ITS RE SIDENTIAL PROJECT BHOOMI PARK AT MARVE ROAD, MALAD(W), MUMBAI. IN SCRUTINY ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER DISALLOWED ASSES SEES ENTIRE CLAIM OF DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT ON AC COUNT OF CERTAIN VIOLATIONS AND FURTHER MADE ADDITIONS ON ACCOUNT OF UNDISCLOSED INTEREST INCOME RS.18,82,023/-. THE ASSESSING OFFICER WHIL E DISALLOWING ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 80 IB (10) OF THE ACT OBSERVED THAT THE ASSESSEE IS NOT ELIGIBLE FOR CLAIMING DEDUCTION IN RESPECT OF SALE OF CAR PARKING AND ALSO ON RESALE OF FLAT. 2.1 AGGRIEVED BY THE ASSESSMENT ORDER DATED 18/0 3/2014 PASSED UNDER SECTION 143(3) OF THE ACT, THE ASSESSEE FILED AN APPEAL BEFORE THE CIT(A). THE CIT(A) ALLOWED PRORATA DEDUCTION UNDE R SECTION 80 IB(10) OF 3 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) THE ACT TO THE EXTENT THERE WERE NO VIOLATIONS IN THE RESIDENTIAL BUILDING. THE CIT(A) FURTHER HELD THAT THE ASSESSEE IS ELIGIB LE FOR CLAIMING DEDUCTION IN RESPECT OF SALE OF CAR PARKING AS WELL AS ON AL LEGED RESALE OF FLAT. HOWEVER, CIT(A) UPHELD THE FINDINGS OF ASSESSING OF FICER QUA ADDITION IN RESPECT OF UNDISCLOSED INTEREST INCOME EARNED BY T HE ASSESSEE ON FIXED DEPOSITS FROM CORPUS FUND, PURPORTEDLY HELD BY TH E ASSESSEE ON BEHALF OF THE PROPOSED RESIDENTS CO-OPERATIVE SOCIETY. AGAIN ST THE AFORESAID FINDINGS OF THE CIT(A), BOTH, THE ASSESSEE AND THE REVENUE ARE IN APPEAL BEFORE THE TRIBUNAL. 3. FOR THE SAKE OF CONVENIENCE, WE WILL FIRST TAKE UP THE APPEAL BY THE ASSESSEE FOR ADJUDICATION. ITA NO.3654/MUM/2017(A.Y. 2011-12)-ASSESSEES APPEA L: 4. THE ASSESSEE IN ITS APPEAL HAS ASSAILED THE FIN DINGS OF FIRST APPELLATE AUTHORITY ON FOLLOWING GROUNDS:- 1. ADDITION ON ACCOUNT OF UNDISCLOSED INTEREST I NCOME: RS. 18,82,023/- A. THE LD. CIT APPEALS ERRED IN TREATING INTEREST INCOME OF SOCIETY AS INTEREST INCOME OF APPELLANT, B. HE FAILED TO APPRECIATE THAT APPELLANT WAS HO LDING THAT AMOUNT ON BEHALF OF PROPOSED SOCIETY AND IN FACT THAT AMOUNT WAS PAID T O SOCIETY AFTER FORMATION. 5. SHRI MAHAVIR JAIN APPEARING ON BEHALF OF THE ASS ESSEE SUBMITTED THAT THE FIXED DEPOSITS ON WHICH INTEREST WAS EARN ED IN FACT BELONGS TO THE CO-OPERATIVE SOCIETY OF THE RESIDENTS. THE COR PUS FUNDS OF THE SOCIETY WERE DEPOSITED IN THE BANK ON WHICH INTEREST HA D ACCRUED. THE ASSESSEE WAS TO HANDED OVER THE FUNDS TO THE SOCIETY. THE ASSESSEE WAS ONLY HOLDINGS FUNDS IN FIDUCIARY CAPACITY. NEITHER THE FIXED DEPOSITS NOR THE 4 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) INTEREST THEREON BELONGS TO THE ASSESSEE. HENCE, TH E SAME WERE NEITHER REFLECTED IN THE BOOKS OF ACCOUNT OF THE ASSESSEE N OR THE INTEREST INCOME ON FIXED DEPOSITS OF SOCIETYS CORPUS FUNDS WAS DEC LARED IN THE RETURN OF INCOME. THE LD.AUTHORIZED REPRESENTATIVE OF THE AS SESSEE FURTHER POINTED THAT SIMILAR ADDITION ON ACCOUNT OF INTEREST INCOME WAS MADE IN ASSESSMENT YEAR 2012-13. THE ADDITION WAS SUSTAIN ED BY THE CIT(A). THE ASSESSEE CARRIED THE ISSUE IN APPEAL BEFORE THE TRI BUNAL IN ITA NO.2315/MUM/2018. THE TRIBUNAL VIDE ORDER DATED 12 /04/2019 DELETED THE ADDITION AFTER PLACING RELIANCE ON THE ORDER IN THE CASE OF ACIT VS. EVERSHINE BUILDERS PVT. IN ITA NO.2827/MUM/2008 DEC IDED ON 01/02/2010 5. ON THE OTHER HAND, SHRI AJAY MALIK, REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE IMPUGNED ORDER CONFIRMING T HE ADDITION OF RS.18,82,023/- IN RESPECT OF UNDISCLOSED INTEREST I NCOME. THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE RESI DENTS CO-OPERATIVE SOCIETY HAD NOT COME INTO EXISTENCE TILL THE END OF 31/03/2011. THE FIXED DEPOSITS IN THE BANK WERE MADE IN THE NAME OF THE A SSESSEE. TDS ON INTEREST ON SAID FIXED DEPOSITS WERE DEDUCTED AND CREDITED TO THE PAN OF THE ASSESSEE. THUS, THE CLAIM OF THE ASSESSEE THAT FIXED DEPOSITS WERE MADE OUT OF CORPUS FUND OF THE SOCIETY AND THE SAI D FUNDS WERE HELD BY THE ASSESSEE IN FIDUCIARY CAPACITY IS AN AFTER THOU GHT. 6. WE HAVE HEARD THE SUBMISSIONS MADE BY REPRESENTA TIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF AUTHORITIES BE LOW. THE SOLITARY ISSUE RAISED BY THE ASSESSEE IN APPEAL IS AGAINST THE ADD ITION OF RS.18,82,023/- 5 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) ON ACCOUNT OF UNDISCLOSED INTEREST INCOME. THE CON TENTION OF THE ASSESSEE IS THAT INTEREST WAS GENERATED ON FIXED DE POSITS MADE FROM CORPUS FUND OF RESIDENTS CO-OPERATIVE SOCIETY. HE NCE, THE INTEREST INCOME IS INCOME OF THE SOCIETY AND NOT OF THE ASSE SSEE. WE DO NOT FIND MERIT IN THE CONTENTIONS RAISED BY THE LD.AUTHORIZ ED REPRESENTATIVE OF THE ASSESSE. IT IS AN UNREBUTTED FACT THAT TILL T HE END OF THE PREVIOUS YEAR, THE RESIDENTS CO-OPERATIVE SOCIETY HAD NOT COME INT O EXISTENCE. THE ALLEGED CORPUS FUND WERE DEPOSITED IN THE BANK IN THE NAME OF THE ASSESSEE. THE TDS ON THE INTEREST ON THE SAID FIXE D DEPOSITS WERE DEDUCTED AND CREDITED TO THE PAN OF THE ASSESSEE. 7. BEFORE WE PROCEED TO DECIDE THIS ISSUE, IT WOULD BE RELEVANT TO REFER TO THE DICTIONARY MENTION OF EXPRESSION FIDUCIARY RELATIONSHIP. THE BLACKS LAW DICTIONARY DEFINES FIDUCIARY RELATIONSHIP AS UNDER:- A RELATIONSHIP IN WHICH ONE PERSON IS UNDER A DUTY TO ACT FOR THE BENEFIT OF ANOTHER ON MATTERS WITHIN THE SCOPE OF T HE RELATIONSHIP. AS PER MERRIAM WEBSTER DICTIONARY FIDUCIARY RELATI ONSHIP MEAN:- A RELATIONSHIP IN WHICH ONE PARTY PLACES SPECIAL T RUST, CONFIDENCE, AND RELIANCE IN AND IS INFLUENCED BY ANOTHER WHO HA S A FIDUCIARY DUTY TO ACT FOR THE BENEFIT OF THE PARTY. FROM THE READING OF MEANING OF FIDUCIARY RELATIONSH IP AS DEFINED IN LEGAL DICTIONARIES REFERRED ABOVE, IT CAN BE SAFELY CONST RUED THAT IT IS A RELATIONSHIP BETWEEN THE TWO PARTIES. THUS, EXISTE NCE OF TWO PARTIES WHETHER REAL OR JURISTIC IS A PRE-CONDITION TO HAVE FIDUCIARY RELATIONSHIP. IN THE ABSENCE OF SECOND PARTY, THERE CANNOT BE ANY FI DUCIARY RELATIONSHIP. 6 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) IN THE INSTANT CASE IT IS AN UNDISPUTED POSITION TH AT CO-OPERATIVE SOCIETY HAD NOT COME INTO EXISTENCE TILL THE END OF RELEVAN T PREVIOUS YEAR. THEREFORE, THE ASSESSEE CANNOT HOLD THE AMOUNT IN F IDUCIARY CAPACITY OF A NON-EXISTENT ENTITY. THE ARGUMENT OF ASSESSEE, HO LDING FUNDS OF SOCIETY IN FIDUCIARY CAPACITY, THUS FAILS. 8. WE ARE OF FURTHER VIEW THAT IF ARGUMENTS FORWAR DED BY LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSEE ARE A CCEPTED, THEN THE INTEREST INCOME ON FIXED DEPOSITS WOULD ESCAPE TAXN ET. IF IT IS HELD THAT THE INTEREST IS NOT INCOME OF THE ASSESSEE, THE SAM E WOULD OBVIOUSLY NOT BE TAXABLE IN THE HANDS OF THE ASSESSEE. SINCE, RESIDENTS CO-OPERATIVE SOCIETY HAS NOT COME INTO EXISTENCE DURING THE PR EVIOUS YEAR WHEN THE INTEREST INCOME HAD ACCRUED, THE INTEREST INCOME CA NNOT BE TAXED IN THE HANDS OF NON-EXISTENT ENTITY. HENCE, INTEREST INCO ME WOULD NEITHER BE TAXABLE IN THE HANDS OF THE ASSESSEE NOR IN THE HAN DS OF CO-OPERATIVE SOCIETY. THE PROPOSITION PUT-FORTH BY THE LD.AUTHO RIZED REPRESENTATIVE OF THE ASSESSEE IS HENCE, UNACCEPTABLE. INCOME COULD NOT BE EARNED IN VACUUM AND IT SHOULD ACCRUE TO CERTAIN BENEFICIARY. 9. IN SO FAR ASSESSEES RELIANCE ON THE ORDER OF TR IBUNAL IN ASSESSEES OWN CASE FOR ASSESSMENT YEAR 2012-13 IS CONCERNED, WE FIND THAT THE TRIBUNAL HAS ALLOWED THE APPEAL OF ASSESSEE BY FOLL OWING THE DECISION RENDERED IN THE CASE OF ACIT VS. M/S. EVERSHINE BUI LDERS PVT. LTD.(SUPRA). THE FACTS IN THE SUBSEQUENT ASSESSMENT YEAR ARE AT VARIANCE AND DISTINGUISHABLE. IN THE CASE OF M/S. EVERSHINE BUI LDERS PVT. LTD.(SUPRA), THE ISSUE WAS TAXABILITY OF CORPUS FUND. THE ASSES SEE THEREIN AT THE TIME 7 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) OF SALE OF FLATS HAD COLLECTED CONTRIBUTION FROM BU YERS OF FLATS TOWARDS CORPUS FUND. THE ASSESSEE EARNED INTEREST ON CORPU S FUND AND OFFERED THE SAME TO TAX. THE ASSESSING OFFICER HELD CONTRI BUTION TOWARDS CORPUS FUND COLLECTED AT TIME OF SALE AS PART OF SALE CONS IDERATION OF THE FLAT. THE ASSESSEE HAD COLLECTED THE CORPUS FUND IN ACCORDANC E WITH THE PROVISIONS OF MAHARASHTRA OWNERSHIP OF FLATS ACT, 1963 AND HAD KEPT THE SAME IN SEPARATE ACCOUNT. THE TRIBUNAL IN THE BACKDROP OF F ACTS NARRATED ABOVE HELD THAT CORPUS FUND IS NOT INCOME OF THE ASSESSEE . IN THE PRESENT CASE, IT IS NOT THE COLLECTION OF CORPUS FUND BUT THE INT EREST ON ALLEGED CORPUS FUND , WHICH IS SUBJECT MATTER OF DISPUTE. CORPUS FUND AND INTEREST ON CORPUS FUND ARE ON DIFFERENT FOOTING. CORPUS FUND I S CAPITAL IN NATURE, WHEREAS, INTEREST EARNED ON CORPUS FUND IS REVENUE RECEIPT. THEREFORE, THE RATIO LAID DOWN IN THE CASE OF EVERSHINE BUILDE RS PVT. LTD.(SUPRA) CANNOT BE APPLIED IN THE CASE OF ASSESSEE IN ASSESS MENT YEAR UNDER APPEAL. 10. WE CONCUR WITH THE FINDINGS OF THE CIT(A) IN CO NFIRMING THE ADDITION ON ACCOUNT OF UNDISCLOSED INTEREST INCOME IN THE HA NDS OF ASSESSEE. THE GROUNDS RAISED BY THE ASSESSEE IN APPEAL ARE DE-VOI D OF ANY MERIT AND, HENCE, THE SAME ARE DISMISSED. ITA NO.4114/MUM/2017- REVENUES APPEAL: 11. THE REVENUE IN ITS APPEAL HAS CHALLENGED THE FI NDING OF CIT(A) BY RAISING FOLLOWING GROUNDS: 1. 'ON THE FACTS AND IN CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE DISALLOWANCE OF RS, 28,00,000/- U/S 80IB(10) ON SALE OF CAR PARKING WITHOUT APPRE9IATING THE RELIANCE PLACED BY LD. AO ON THE DECISION OF HO N'BLE SC IN THE CASE OF NAHALCHAND 8 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) LALOOCHAND PVT. LTD. VS. PANCHALI CO-OPERATIVE HOUS ING SOCIETY IN THE CONTEXT OF THE CASE AND PROVISIONS OF SECTION 80IB(10) OF THE INCOME TAX AC T, 1961 IN ITS RIGHT PERSPECTIVE AND TRUE MEANING.' 2. 'ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD.CIT(A) ERRED IN APPRECIATING THE FACTS THAT BUY-BACK AND RE-SALE IS A TRADING AC TIVITY IN THE CONTEXT OF THE CASE AND PROVISIONS OF SECTION 80IB(10) OF THE INCOME TAX ACT, 1961 IN ITS RIGHT PERSPECTIVE AND TRUE MEANING.' 3. 'ON THE FACTS AND IN CIRCUMSTANCES OF THE CAS E AND IN LAW, THE LD.CIT(A) ERRED IN APPRECIATING THE VIOLATION OF PROVISIONS OF CLAUSE (E) AND (F) OF SECTION 80IB(10) OF THE INCOME TAX ACT, 1961 IN ITS RIGHT PERSPECTIVE AND TRUE MEA NING.' 11. THE LD.AUTHORIZED REPRESENTATIVE OF THE ASSESSE E VEHEMENTLY DEFENDED THE FINDING OF CIT(A) IN ALLOWING DEDUCTIO N UNDER SECTION 80 IB(10) OF THE ACT ON PRO-RATA BASIS AND ALSO ALLOWI NG THE SAID DEDUCTION IN RESPECT OF SALE OF CAR PARKING AND RESALE OF FLAT. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT THE ISSUE OF ALLOWING DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT ON CAR PARKING IS SQUARELY COVERED BY THE DECISION OF HON'BLE BOMBAY HIGH COUR T IN THE CASE OF PURAVANKARA PROJECTS LTD. IN INCOME TAX APPEAL NO. 4975 OF 2010 DECIDED ON 25/07/2011. 11.1 THE OTHER ISSUE RAISED IN THE APPEAL BY TH E REVENUE IS IN RESPECT OF ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 80- IB(10) ON RESOLD FLAT. THE ASSESSING OFFICER HAD DISALLOWED DEDUCTION ON WRONG APPRECIATION OF FACTS. THE CIT(A) AFTER EXAMINING THE FACTS IN RIG HT PERSPECTIVE CAME TO THE CONCLUSION THAT THE ASSESSEE IS ELIGIBLE FOR CL AIMING DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT IN RESPECT OF FLAT WHI CH WAS RESOLD AFTER CANCELLING THE FIRST ALLOTMENT. THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSESSEE SUBMITTED THAT ONE FLAT K/1204 WAS INITIAL LY BOOKED BY SHRI JAILESH OBEROI AND SMT. VIMLA OBEROI. THE TOTAL CONSIDERATION OF THE FLAT 9 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) WAS AGREED AT RS.46,66,000/-. THE VENDEES PAID INITIAL BOOKING AMOUNT OF RS.2,50,000/- ONLY AND THEY FAILED TO MAKE PAYM ENT OF THE REMAINING SALE CONSIDERATION. THEREFORE, THE BOOKING WAS CAN CELLED. THE SAID FLAT WAS SUBSEQUENTLY SOLD FOR RS.75,50,000/- ON WHICH THE ASSESSEE CLAIMED DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT . THU S, IT IS NOT THE CASE OF CLAIM OF DEDUCTION UNDER SECTION 80 IB(10) OF THE A CT TWICE ON RESALE OF FLAT. 11.2 THE LD. AUTHORIZED REPRESENTATIVE FOR THE ASSE SSEE FURTHER SUBMITTED THAT AS REGARDS ALLOWABILITY OF PRO-RATA DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT IS CONCERNED, THE HONBLE BO MBAY HIGH COURT IN THE CASE OF VANDANA PROPERTIES, 353 ITR 36 AND THE HON BLE MADRAS HIGH COURT IN THE CASE OF VISWAS PROMOTERS, 214 TAXMAN 524(MAD) HAS APPROVED THE SAME.. 12. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENT ATIVE VEHEMENTLY DEFENDED THE ORDER OF ASSESSING OFFICER IN REJECTIN G ASSESSEES CLAIM OF DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT AND PR AYED FOR REVERSING THE FINDINGS OF CIT(A) ON THIS ISSUE. 13. BOTH SIDES HEARD. GROUND NO.1 OF THE APPEAL BY THE REVENUE IS AGAINST ALLOWING DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT IN RESPECT OF SALE OF CAR PARKING . WE FIND THAT THIS ISSUE IS S QUARELY COVERED IN FAVOUR OF THE ASSESSEE BY VARIOUS DECISIONS OF THE TRIBUNA L. THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF PURAVANKA RA PROJECTS LTD.( SUPRA) HAS AFFIRMED THE FINDINGS OF TRIBUNAL IN HOLDING TH AT CAR PARKING SPACE 10 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) FORMS PART & PARCEL OF HOUSING PROJECT AND THE ASSE SSEE IS ENTITLED TO DEDUCTION UNDER SECTION 80 IB(10) IN RESPECT OF SAL E OF PARKING AREA. THE CIT(A) GRANTED RELIEF TO THE ASSESSEE BY FOLLOWING THE DECISIONS OF THE TRIBUNAL AND THE HONBLE HIGH COURT. WE FIND NO RE ASON TO INTERFERE WITH THE WELL REASONED FINDING OF CIT(A). THUS, GROUND NO.1 OF THE APPEAL OF REVENUE IS DISMISSED. 14. IN GROUND NO.2 OF THE APPEAL, REVENUE HAS ASS AILED ALLOWING OF DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT IN RES PECT OF FLAT WHICH HAS BEEN ALLEGEDLY RESOLD. A PERUSAL OF RECORDS REVE AL THAT FLAT NO.K/1204 ON WHICH REVENUE IS DISPUTING THE CLAIM OF DEDUCTION U NDER SECTION 80 IB(10) WAS INITIALLY SOLD TO SHRI JAILESH OEBROI & SMT. VI MLA OBEROI. THEY HAD PAID INITIAL TOKEN AMOUNT OF RS.2,50,000/- AT THE T IME OF BOOKING FLAT. THEREAFTER, THEY DEFAULTED THE TERMS OF PAYMENT AND THE ASSESSEE HAD TO CANCEL THE BOOKING. AFTER CANCELLATION OF THE INIT IAL SALE AGREEMENT, THE FLAT WAS RESOLD TO OTHER PARTY. THE ASSESSEE CLAIM ED DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT IN RESPECT OF PROFITS ARISING FROM RESALE OF SAID FLAT. IT IS NOT A CASE WHERE THE ASSESSEE HAS INDU LGED IN ANY TRADING/BROKING OF THE SAME FLAT TWICE. IT WAS UND ER PECULIAR FACTS THAT THE FIRST AGREEMENT WAS CANCELLED AND THE FLAT WAS RESOLD. WE DO NOT FIND ANY ERROR IN THE FINDINGS OF CIT(A) IN ALLOWING DED UCTION UNDER SECTION 80 IB(10) OF THE ACT ON THE PROFITS ARISING FROM SAL E OF SAID FLAT. 15. WE FIND NO INFIRMITY IN THE FINDINGS OF CI T(A) IN ALLOWING PROPORTIONATE DEDUCTION ON THE ELIGIBLE FLATS OF TH E HOUSING PROJECT. THE 11 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) CONCEPT OF ALLOWING PROPORTIONATE DEDUCTION ON ELI GIBLE FLATS HAVE BEEN APPROVED BY HONBLE JURISDICTIONAL HIGH COURT IN TH E CASE OF VANDANA PROPERTIES (SUPRA). THE GROUND NO.3 OF THE APPEAL I S DISMISSED BEING DEVOID OF ANY MERIT. 16. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. 17. TO SUM UP, APPEAL OF THE ASSESSEE AND APPEAL OF THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THURSDAY, T HE 31ST DAY OF OCTOBER, 2019. SD/- SD/- (RAJESH KUMAR ) (VIKAS AWASTHY) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED 31/10/2019 VM , SR. PS(O/S) COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT , 2. THE RESPONDENT. 3. THE CIT(A)- 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE. BY ORDER, //TRUE COPY// (DY./ASSTT. REGISTRAR) ITAT, MUMBAI 12 ITA NO.3654/MUM/2017(A.Y. 2011-12) ITA NO.4114/MUM/2017(A.Y. 2011-12) DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 17/09/2019 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 17/09/2019 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/A M 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER FIDUCIARY RELATIONSHIP BLACKS LAW DICTIONARY A RELATIONSHIP IN WHICH ONE PERSON IS UNDER A DUTY TO ACT FOR THE BENEFIT OF ANOTHER ON MATTERS WITHIN THE SCOPE OF THE RELAT IONSHIP. A RELATIONSHIP IN WHICH ONE PARTY PLACES SPECIAL TR UST, CONFIDENCE, AND RELIANCE IN AND IS INFLUENCED BY ANOTHER WHO HAS A FIDUCIARY DUTY TO ACT FOR THE BENEFIT OF THE PARTY.