M/s Keshari Tritan Developers (P) Ltd, Bhubaneswar V. ACIT, Bhubaneswar

ITA 46/CTK/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4390 (ITAT-CUTTACK)
• Duration Of Justice: 3 year(s) 4 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-06-2011
• Appeal Filed By: Assessee
• Bench Allotted: DB
• Next Hearing Date: 15-06-2011
• Assessment Year: 2004-2005
• Appeal Filed On: 08-02-2008
• Court: TRIBUNAL
• Department Lawyers: K N JANA
• Assessee Lawyers: P K BALMI HIR SAHOO ARS

Judgement Text

IN THE INCME TAX APPELLATE TRIBUNAL, CUTTACK BENCH, CUTTACK BEFORE : HONBLE SHRI K.K.GUPTA, ACCOUNTANT MEMBER, AND HONBLE SHRI K.S.S.PRASAD RAO, JUDICIAL MEMBER. ITA NO. 46/CTK/2008 (ASSESSMENT YEAR 2004 - 05) M/S. KESHARI TRITAN DEVELOPERS (P) LTD. , PLOT NO.1259, UNIT - 9, BHUBANESWAR NEW ADDRESS: M4/34, ACHARYA VIHAR, BHUBANESWAR - 13. VERSUS ASST.COMMISSIONER OF INCOME - TAX, CIRCLE 2(1), BHUBANESWAR. (APPELLANT) (RESPONDENT) FOR THE APPELLANT: SHRI P.K.BAL/MIHIR SAHOO,ARS FOR THE RESPONDENT SHR I K.N.JANA, DR ORDER SHRI K.K.GUPTA, ACCOUNTANT MEMBER : THIS APPEAL BY THE ASSESSEE IS ON THE ACTION OF THE LEARNED COMMISSIONER OF INCOME - TAX (APPEALS) DENYING THE DEDUCTION 80IB(10) HOLDING THAT THE ASSESSEE HAD NOT SATISFIED THE CONDITIONS REQUIRED AS PER THE PROVISIONS THERE UNDER. 2. AT THE OUTSET THE LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE ISSUE STANDS COVERED BY THE DECISION OF THE TRIBUNAL IN THE CASE OF AN ASSOCIATE CONCERN OF THE ASSESSEE NAMELY, KZK DEVELOPERS IN ITA NO.308/CTK/20 10 AND 19/CTK/2011 ORDER DT.20.5.2011. BRIEFLY HE SUBMITTED THAT THE MISCONCEPTION IN THE MIND OF THE ASSESSING OFFICER AND THE LEARNED CIT(A) HAS BEEN CLARIFIED IN THE ORDER OF THE TRIBUNAL WHO IN TURN HAD RELIED ON THE ORDER OF THE ITAT, KOLKATA BENCH IN THE CASE OF BENGAL AMBUJA HOUSING DEVELOPMENT LIMITED V. CIT IN ITA NO.1595/KOL/20 - 05 FOR THE ASSESSMENT YEAR 2002 - 03. HE PUT FORTH THE PROPOSITION THAT IT WAS NOT THE CASE OF ASSESSEE CLAIMING PRORATA DEDUCTION INSOFAR AS THE ASSESSEE HAD COMPLIED WITHA L THE PROVISIONS OF SECTION 80IB(1) ONCE THE PROJECT HAD BEEN APPROVED AS A JOINT VENTURE WITH THE GOVERNMENT AUTHORITIES. THERE IS NO SEGREGATION OF THE DEDUCTION AND THE ASSESSEE HAS CLAIMED DEDUCTION ONLY ON THE PORTION OF INCOME WHICH ENTITLED IT TO C LAIM DEDUCTION WHEN THE DEVELOPMENT OF CONSTRUCTION OF THE PROJECT COMMENCED AFTER 1 ST OCTOBER, 1998, THE PROJECT WAS ON THE SIZE OF PLOT OF MORE THAN ONE ACRE AND THE BUILT UP AREA OF EACH ITA NO.46/CTK/2008 2 RESIDENTIAL UNIT WAS NOT MORE THAN 1500 SFT AS APPLICABLE TO BHUBA NESWAR. IN OTHER WORDS, HE POINTED OUT THAT THERE WAS NO CASE FOR INVOKING THE PROVISIONS OF SECTION 80IB(10) IN THE FIRST PLACE AS PER THE CERTIFICATE ISSUED BY THE CHARTERED ACCOUNTANT FOR CLAIMING SUCH DEDUCTION WHEREIN THE AREA DEVELOPED WAS IDENTIFIE D AS FULLY ENTITLED FOR DEDUCTION. 3. THE LEARNED DR HAS NOT BEEN ABLE TO POINT OUT ANY CONTROVERTING MATERIAL ON RECORD TO THE FACTS FOR RELYING ON THE DECISION OF THE ITAT, KOLKATA BENCH AS RELIED UPON AND ALSO WAS CONSIDERED FOR ADJUDICATION IN THE CASE OF KZK DEVELOPERS WHO ALSO UNDERTOOK DIFFERENT PROJECTS AS JOINT VENTURES WITH THE GOVERNMENT AUTHORITIES FOR NOT CLAIMING PROPORTIONATE DEDUCTION BUT FOR THE VERY PLOT OF AREA WHICH FELL WITHIN THE AMBIT OF ENTITLEMENT EACH BEING 1500 SFT. HOWEVER, HE RE LIED ON THE ORDERS OF THE AUTHORITIES BELOW FOR HIS PART SUBMISSIONS. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE DO NOT FIND ANY INFIRMITY IN THE CONTENTION OF THE LEARNED COUNSEL FOR THE ASSESSEE WHEREIN THE M AIN THRUST BY THE LEARNED CIT(A) AND THE ASSESSING OFFICER HAS BEEN ON THE ISSUES WHICH LEAN MORE ON DEMOLISHING THE VERY BASIS FOR CLAIMING DEDUCTION U/S.80IB(10). ON THE BASIS OF FACTS AND CIRCUMSTANCES AS HAVE BEEN BROUGHT ON RECORD WE ARE INCLINED TO HOLD THAT IT WAS NOT THE CASE OF THE ASSESSEE CLAIMING PROPORTIONATE DEDUCTION ON THE TOTAL APPROVAL GRANTED FOR HAVING DEVELOPED THE LAND AS A JOINT VENTURE WITH THE GOVERNMENT AUTHORITIES WHO HAD ALSO GRANTED THE APPROVAL IN THE SAME ANALOGY. THE ASSES SEE NEVER CLAIMED DEDUCTION OF INCOME ON THE PLOTS EXCEEDING 1500 SFT THEREFORE CANNOT BE CONSIDERED FOR DOUBTING WHETHER SUCH DEVELOPMENT ENTITLED THE ASSESSEE FOR CLAIMING DEDUCTION U/S.80IB INSOFAR AS THE VERY GOVERNMENT AUTHORITIES WHO APPROVED AND IDE NTIFIED THE AREA BY SANCTIONING THE SAME WAS THE LEGITIMATE CLAIM NOT BASED ON ANY CONTRACT AMONGST THE TWO. THE ASSESSEE HAS BEEN ABLE TO ESTABLISH THAT THE LAND ALLOTTED TO THE ASSESSEE HAD NO BEARING ONCE THE SHARE OF THE JOINT VENTURE NAMELY THE GOVERN MENT AUTHORITIES WAS NO MORE TO BE CONSIDERED FOR THE PURPOSE OF INCOME GENERATED TO BE SHARED AMONGST THE TWO. THE LINEAR BUSINESS TRANSACTION THEREFORE REQUIRED NO FURTHER ASSESSMENT FOR PROVING THE BONAFIDE OF THE ASSESSEE LEADING TO CLAIM DEDUCTION U/S .80IB AND THAT TOO PROPORTIONATELY. THE ITA NO.46/CTK/2008 3 ISSUE THEREFORE STANDS COVERED BY OUR DECISION IN THE KZK DEVELOPERS (SUPRA). THE LEARNED COUNSEL HAS SUPPORTED HIS PLACING RELIANCE ON THE CITED CASE BY PUTTING THE FACTS AS NOTED BY THE ASSESSING OFFICER AND THE LE ARNED CIT(A) IN THE FORM OF A PAPER BOOK WHICH HAS BEEN TAKEN ON RECORD. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. PRONOUNCED IN OPEN COURT ON DT. 17 TH JUNE, 2011 SD/ - SD/ - (K.S.S.PRASAD RAO) JUDICIAL MEMBER (K.K.GUPTA) ACCOUNTANT MEMBER DATE: 17 TH JUNE, 2011 H.K.PADHEE, SENIOR PRIVATE SECRETARY. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT: M/S. KESHARI TRITAN DEVELOPERS (P) LTD., PLOT NO.1259, UNIT - 9, BHUBANESWAR NEW ADDRE SS: M4/34, ACHARYA VIHAR, BHUBANESWAR - 13. 2. THE RESPONDENT: ASST.COMMISSIONER OF INCOME - TAX, CIRCLE 2(1), BHUBANESWAR. 3. THE CIT, 4. THE CIT(A), 5. THE DR, CUTTACK 6. GUARD FILE (IN DUPLICATE) TRUE COPY, BY O RDER, SENIOR PRIVATE SECRETARY.