ITO WD 4(3), THANE V. SAPTARSHI GROUP,

ITA 4292/MUM/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 7708 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 9 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: J
• Next Hearing Date: 22-03-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 18-06-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUBODH RATNAPARIKH
• Section: 143(3)

Judgement Text

I.T.A NO.4292/ MUM/2008 SAPTARSHI GROUP 1 IN THE INCOME TAX APPELLATE TRIBUNAL, J BENCH, MUMBAI. BEFORE SHRI D.K.AGARWAL, JUDICIAL MEMBER AND SHRI PRAMOD KUMAR, ACCOUNTANT MEMBER I.T.A NO.4292/ MUM/2008 ASSESSMENT YEAR: 2004-05 INCOME TAX OFFICER 4(3) .. APPELLANT QUERESHI MANSION, GOKHALE ROAD, NAUPADA, THANE. VS SAPTARSHI GROUP ,. RESPONDENT 101, 1 ST FLOOR, SATYAM SHIVAM SHOPPING CENTRE, NALLASOPARA(W),MUMBAI. PA NO.AAYFS 1650 R APPEARANCES: C.P. PATHAK, FOR THE APPELLANT SUBODH RATNAPARIKH, FOR THE RESPONDENT O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CAL LED INTO QUESTION CORRECTNESS OF CIT(A)S ORDER DATED 11 TH MARCH, 2008, IN THE MATTER OF ASSESSMENT UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961, F OR THE ASSESSMENT YEAR 2004-05. 2. THE SHORT GRIEVANCE THAT WE ARE REQUIRED TO ADJUD ICATE ON THIS APPEAL IS WHETHER OR NOT THE CIT (A) WAS JUSTIFIED IN ALLOWING PROPORTIONATE DEDUCTION U/S. 80- IB(10) OF THE ACT. I.T.A NO.4292/ MUM/2008 SAPTARSHI GROUP 2 3. BRIEFLY STATED THE MATERIAL FACTS ARE LIKE THIS. D URING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER NOTICED THAT THE ASSESSEE HAS CLAIMED DEDUCTION U/S.80 IB(10) TO THE EXTENT OF RS.7,86,210. THE ASSESSIN G OFFICER DECLINED TO GRANT DEDUCTION ON THE FOLLOWING REASONS:- I) THE PROJECT UNDERTAKEN BY THE ASSESSEE COMPANY HAS NO T BEEN APPROVED BY THE LOCAL AUTHORITY AS HOUSING PROJECT BUT WHICH HAS BEEN APPROVED AS RESIDENTIAL CUM COMMERCIAL PROJECT . II) SINCE THE TOTAL BUILT UP AREA OF SHOPS IN THE PROJ ECT WORKS OUT TO 8300 SQ.FT THE PROJECT UNDERTAKEN BY THE ASSESSEE COMPANY DOE S NOT FALL IN THE CATEGORY OF HOUSING PROJECT AS HAS BEEN HELD IN THE CASE OF M/S. LAUKIK DEVELOPERS. 4. AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE CIT(A), WHO FOLLOWING THE DECISION OF ITAT KOLKATA IN THE CASE OF BENGAL AMBUJA HOUSING DEVELOPMENT LTD V DCIT, WHEREIN, THE PRINCIPLE OF P RORATE DEDUCTIONS IN RESPECT OF UNITS, COMPLYING WITH THE CONDITIONS PRESCRIBED UNDER SECTION 80 IB(10) OF THE ACT, HAS BEEN UPHELD BY THE HONBLE KOLKATA HIGH COURT VI DE ORDER DATED 27.3.2007, GRANTED RELIEF ON PRORATA BASIS. AGAINST THE ORDER OF THE CIT (A), THE ASSESSEE HAS NOT APPEALED. HOWEVER, THE REVENUE IS IN APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED THE FACTUAL MATRIX OF THE CASE AS ALSO THE A PPLICABLE LEGAL POSITION. 6. LEARNED REPRESENTATIVES AGREE THAT HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT VS. BRAHMA ASSOCIATES, 51 DTR 298 (BOM) HAS HELD THA T SECTION 80 IB(10) IS TO BE ALLOWED IN ENTIRETY TO THE HOUSING PROJECTS APPROV ED BY THE LOCAL AUTHORITY HAVING RESIDENTIAL UNITS WITH COMMERCIAL USER. THEREFORE, WE ARE UNABLE TO SEE ANY MERITS IN REVENUES APPEAL. HOWEVER, WE MAKE IT CLEAR THAT WHAT HAS BEEN ALLOWED BY THE CIT (A) IS DEDUCTION ON PRORATA BASIS, THE ASSESSEE HAS NOT CHALLENGED THE DECISION OF THE CIT (A). THEREFORE, EVEN THOUGH IN PRINCIPLE, AS PER THE LAW LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF BRAHMA ASSOC IATES (SUPRA), THE ASSESSEE IS ENTITLED TO FULL DEDUCTION OF ENTIRE PROJECT, WE AP PROVE THE CONCLUSIONS ARRIVED AT BY I.T.A NO.4292/ MUM/2008 SAPTARSHI GROUP 3 THE CIT(A) AND LEAVE IT AT THAT. THE RELIEF GRANTE D BY THE CIT (A) IS CLEARLY LESS THAN THE RELIEF ALLOWED IN ACCORDANCE WITH THE LAW LAID DOWN BY THE HONBLE BOMBAY HIGH COURT IN THE CASE OF BRAHMA ASSOCIATES(SUPRA) AND, THERE FORE, NO FAULT IS FOUND IN THE RELIEF TO THE EXTENT GRANTED BY THE CIT (A). 7. IN THE RESULT, APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 31 ST MARCH, 2011 SD/- (D.K.AGARWAL) JUDICIAL MEMBER SD/- (PRAMOD KUMAR) (ACCOUNTANT MEMBER) MUMBAI, DATED 31 ST MARCH, 2011 PARIDA COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3. COMMISSIONER OF INCOME TAX (APPEALS),II, MUMBAI 4. COMMISSIONER OF INCOME TAX,III , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, BENCH J, MUMBAI //TRUE COPY// BY ORDER ASSTT. REGISTRAR, ITAT, MUMBAI