ITO 25(3)(2), MUMBAI V. JAYANTIAL INVESTMENT, MUMBAI

ITA 4285/MUM/2013

• Counselvise Citation: [2017] 128 COUNSELVISE.COM (IT) 1088 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 10 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-04-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 17-08-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 29-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ARJU GARODIA
• Section: 6; 2

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL J , BENCH, MUMBAI , , , BEFORE SHRI RAJENDRA, AM AND SHRI RAM LAL NEGI, JM ./ ITA NO. 4285 / MUM/ 201 3 ( / ASSESSMENT YEAR: 2008 - 09 ) THE INCOME TAX OFFICER - 25(3)(2), C - 11, R. NO. 306, PRATYAKSH KAR BHAVAN, BANDRA - KURLA COMPLEX, BANDRA (EAST), MUMBAI - 400051 VS. M/S JAYANTILAL INVESTMENTS, 101, BALAJI ARCADE,S.V. ROAD , OPP CENTRAL BANK OF INDIA, KANDIVALI (W), MUMBAI - 400067 ./ ./ PAN/GIR NO. : AAAFJ 1402 D ( / APPELLANT ) .. ( / RESPOND ENT ) & ./ ITA NO. 4068 / MUM/ 201 3 ( / ASSESSMENT YEAR: 2008 - 09 ) M/S JAYANTILAL INVESTMENTS, 101, BALAJI ARCADE,S.V. ROAD, OPP CENTRAL BANK OF INDIA, KANDIVALI (W), MUMBAI - 400067 VS. THE INCOME TAX OFFICER - WD 25(3)(2), C - 11/306, PRATYAKSH KAR BHAVAN, BANDRA (EAST), MUMBAI - 400050 ./ ./ PAN/GIR NO. : AAAFJ 1402 D ( / APPELLANT ) .. ( / RESPONDENT ) /ASSESSEE BY : NONE /REVENUE BY : MS. ARJU GARODIA / DATE OF HEARING : 04/04 /2017 / DATE OF PRONOUNCEMENT : 28 /04 /2017 2 ITA NO S . 4285 &4068/MUM/2013 ASSESSMENT YEAR: 2008 - 09 / O R D E R PER RAM LAL NEGI, JM THESE ARE THE CROSS APPEALS FILED BY THE REVENUE AND THE ASSESSEE RESPECTIVELY AGAINST THE ORDER DATED 25/03/2013 PASSED BY THE CIT (A) - 35, MUMBAI PERTAINING TO THE ASSESSMENT YEAR 2008 - 09, WHEREBY THE LD. CIT (A) HAS PARTLY ALLOWED THE APPEAL FILED BY THE ASSESSEE AGAINST ASSESSMENT ORDER PASSED U/S 143 (3) OF THE INCOME TAX ACT, 1961 (FOR SHORT THE ACT) . 2. THESE APPEALS WERE FI XED FOR HEARING FOR 4.4.2017. ON 4.4.2017 WHEN THE CASE WAS CALLED FOR HEARING , ONE PERSON WITHOUT HAVING LETTER OF AUT HORITY PRESENTED AN APPLICATION FOR ADJOURNMENT. PERUSAL OF RECORD REVEAL ED THAT FROM THE DATE OF FILING OF THE SE APPEALS THE ASSESSEE HAS SOUGHT ADJOURNMENTS ON MORE THAN FIFTEEN TIMES . ON TWO OCCASIONS NEITHER THE REPRESENTATIVE OF THE ASSESSEE APPEARED NOR ANY APPLICATION FOR ADJOURNMENT WAS RECEIVE D . I N VIEW OF THE PAST CONDUCT OF THE ASSESSEE , WE REJECTED THE APPLICATION AND DECIDED TO PROCEED EX - PARTE AGAINST THE ASSESSEE AND DISPOSE OF THE APPEAL S ON THE BASIS OF MATERIAL AVAILABLE ON RECORD, AFTER H EARING THE DEPARTMENTAL REPRESENTATIVE. ITA NO. 4285 / MUM/2013 (ASSESSMENT YEAR: 2008 - 09 ) 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FIRM FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2008 - 09 DECLARIN G THE TOTAL INCOME AS NIL. LATER ON THE RET URN WAS REVISED AND DECLARED THE TOTAL TAXABLE INCOME AT RS. 20,99,570/ - . THE RETURN WAS PROCESSED U/S 143 (1) OF THE ACT AND AFTER SCRUTINY THE AO DETERMINING THE TOTAL INCOME OF THE ASSESSE E AT RS. 70,38,870/ - . 4. AGGRIEVED BY THE ASSESSMENT ORDER , THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A) IN THE FIRST APPEAL . THE LD. CIT(A) AFTER HEARING THE ASSESSEE 3 ITA NO S . 4285 &4068/MUM/2013 ASSESSMENT YEAR: 2008 - 09 AND TAKING INTO CONSIDERATION THE EXPLANATIONS IN THE LIGHT OF THE DOCUMENTS SUBMITTED BY THE ASSESSEE IN SUPPORT OF ITS CLAIM PARTLY ALLOWED THE A PPEAL OF THE ASSESSEE. THE REVENUE HAS FILED THE PRESENT APPEAL AGAINST THE IMPUGNED ON THE FOLLOWING EFFECTIVE GROUNDS OF APPEAL: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, AND IN LAW, THE LD. CIT (A) ERRED IN DELETING THE ADDITION OF RS. 48,38,237/ - WHICH WAS SHOWN AS ADVANCE ALTHOUGH THE ASSESSEE IS FOLLOWING PROJECT COMPLETION METHOD OF AS - 7 AND THE PROJECT HAS BEEN COMPLETED DURING THE YEAR AND OBTAINED OCCUPANCY CERTIFICATE, IN RESPECT OF PROJECT. 2. THE APPELLANT PRAYS THAT THE OR DER OF THE LD. CIT (A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE AO BE RESTORED. 3. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUND OR ADD A NEW GROUND. 5. BEFORE US, THE LD. DEPARTMENTAL REPRESENTATIVE RELYING ON THE ASSESSMENT ORDER SU BMITTED THAT THE LD. CIT (A) HAS ERRED IN DELETING THE ADDITION OF RS. 48,38,237/ - WHICH WAS SHOWN AS ADVANCE BY THE ASSESSEE DESPITE THE FACT THAT THE ASSESSE E WAS FOLLOWING PROJECT COMPLETION METHOD OF AND THE PROJECT HA D BEEN COMP L ETED DURING THE YEAR R ELEVANT TO THE ASSESSMENT UNDER CONSIDERATION. 6. WE HAVE PERUSED THE MATERIAL ON RECORD IN THE LIGHT OF THE SUBMISSIONS OF THE LD. CIT(A). THE LD. CIT(A) HAS DELETED THE ADDITION HOLDING AS UNDER: 5.3 GOING THROUGH THE ASSESSMENT ORDER AND SUBMISSION S MADE BY THE APPELLANT, I AM CONVINCED THAT AS PER THE ACCOUNTING METHOD CONSISTENTLY FOLLOWED BY THE APPELLANT AND ACCEPTED BY DEPARTMENT IN EARLIER ASSESSMENT ORDERS, ACTION OF AO TREATING ADVANCE RECEIVED ON BOOKING OF FLATS AS SALE OF FLATS IS NOT CORRECT AS PER THE LAW OF PRECEDENT AND FURTHER, AS SALE OF THOSE FLATS ARE ALREADY ACCOUNTED IN ASSESSMENT YEAR 4 ITA NO S . 4285 &4068/MUM/2013 ASSESSMENT YEAR: 2008 - 09 2009 - 10 AND CONSIDERED FOR TAXATION PURPOSE, ANY ADDITION IN CURRENT ASSESSMENT YEAR 2008 - 09 IS NOT JUSTIFIED BECAUSE IT WILL AMOUNT OF DOUBLE TAXATION. IT IS ALSO SEEN THAT THERE WAS PROHIBITORY ORDER BY THE INCOME TAX DEPARTMENT IN CASE OF FLAT NOS. A/001 AND A/002 AND THEREFORE, NO POSSESSIONS WERE GIVEN TO THE BUYERS TILL 2012 WHEN SAID PROHIBITORY ORDER WAS WITHDRAWN BY THE INCOME TAX DEPAR TMENT. ACCORDINGLY, DISPUTED ADDITION OF RS. 48,38,237/ - IS DELETED. 7 . WE NOTICE THAT THE ASSESSEES CONTENTION BEFORE THE LD. CIT(A) WAS THAT PHYSICAL POSSESSION OF SIX FLATS WERE NOT HANDED OVER TO THE PROSPECTIVE BUYERS THEREFORE, THE AMOUNTS RECEIVE D FROM THEM WERE SHOWN AS ADVANCE RECEIVED AGAINST BOOKING OF FLATS AND COST OF THE FLATS WERE SHOWN AS CLOSING STOCK AT COST PRICE. THE POSSESSION OF THE SAID FLATS WAS GIVEN DURING THE YEAR 2009 - 10 AND THE SALES WERE ACCOUNTED IN THE ASSESSMENT YEAR 2009 - 10. I N VIEW OF THE AFORESAID FACTS WE DO NOT FIND ANY REASON TO INTERFERE WITH THE ORDER PASSED BY THE LD. CIT(A). WE, THEREFORE, UPHOLD THE FINDINGS OF THE LD CIT(A) AND DISMISS THE SOLITARY GROUND OF APPEAL OF THE REVENUE. ITA NO. 4068/MUM/2013 (ASSESS MENT YEAR: 2008 - 09 ) 8 . THE ASSESSEE HAS RAISED THE FOLLOWING EFFECTIVE GROUNDS OF APPEAL AGAINST THE IMPUGNED ORDER PASSED BY THE LD. CIT (A): - 1. ON THE FACTS AND IN LAW, LEARNED CIT (A) HAS ERRED IN SUSTAINING ADDITION OF RS. 30,79,922/ - MADE BY THE ASS ESSING OFFICER AS ESTIMATED PROFIT FOR WORK - IN - PROGRESS FOR CONSTRUCTION OF KUBAR PROJECT FOR THE YEAR EN DED 31.03.2007. 2. ON THE FACTS AND IN LAW, IT IS KINDLY REQUESTED TO DELETE IMPUGNED ADDITION OF RS. 30,79,922/ - SUSTAINED BY THE LEARNED CIT (A). 9 . THE LD. DR RELYING ON THE IMPUGNED ORDER PASSED BY THE LD. CIT(A) SUBMITTED THAT THE LD. CIT(A) HAS RIGHTLY DISMISSED THE APPEAL OF THE ASSESSEE 5 ITA NO S . 4285 &4068/MUM/2013 ASSESSMENT YEAR: 2008 - 09 AND SUSTAINED THE ADDITION OF RS. 30,79,922/ - MADE BY THE ASSESSING OFFICER AS ESTIMATED PROFIT FOR WORK IN PROGRESS FOR CONSTRUCTION OF KUBER PROJECT . TH E LD. DR FURTHER SUBMITTED THAT THE LD. CIT(A) HAS CONFIRMED THE ADDITION IN QUESTION BY FOLLOWING THE ORDER PASSED BY THE CIT(A) IN ASSESSEES OWN CASE FOR THE ASSESSMENT YEAR 2007 - 08. 10 . WE HAVE CAREFULL Y PERUSED THE ORDERS OF THE AUTHORITIES BELOW IN THE LIGHT OF THE SUBMISSIONS OF THE LD. DR. THE LD. CIT(A) HAS CONFIRMED THE ADDITION AFORESAID BY HOLDING AS UNDER: - 7.3 I FIND THAT THE AO HAS CORRECTLY FOLLOWED THE DIRECTION OF MY PREDECESSOR IN APPEAL ORDER NO. CIT (A) - 35/ITO - 25 (3) (2)/ITA - 468/2009 - 10 DATED 26.04.2010 AND WHEN THE MATTER IS PENDING BEFORE THE HONBLE TRIBUNAL AND MATTER IS NOT ADJUDICATED BY THE TRIBUNAL TILL DATE, THIS GROUND OF APPEAL IS REJECTED AND DISMISSED. IN THE RESULT, THIS GROUND RELATED TO ADDITION OF RS. 30,79,922/ - IS DISMISSED. 1 1 . THE LD. CIT(A) HAS CONFIRMED THE ADDITION IN QUESTION BY FOLLOWING THE ORDER OF HIS PREDECESSOR PASSED IN ASSESSEES APPEAL FOR AY 2007 - 08. I N THE ABSENCE OF ANY EVIDENCE TO REBUT THE CONC URRENT FINDINGS OF THE AUTHORITIES BELOW, WE HAVE NO OPTION BUT TO CONFIRM THE IMPUGNED ORDER . WE, ACCORDINGLY, UPHOLD THE FINDINGS OF THE LD. CIT(A) AND DISMISS THE SOLE GROUND OF APPEAL OF THE ASSESSEE. IN THE RESULT, CROSS APPEAL S FILED BY THE REVENUE AND THE ASSESSEE FOR ASSESSMENT YEAR 2008 - 09 ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28 TH APRIL , 2017 . SD/ - SD/ - ( RAJENDRA ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 28 / 0 4 / 2017 6 ITA NO S . 4285 &4068/MUM/2013 ASSESSMENT YEAR: 2008 - 09 ALINDRA, PS / 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, MU MBAI