Tellapur Technocity Private Limited, Hyderabad, Secunderabad V. DCIT, Circle-2(3), Hyderabad, Hyderabad

ITA 485/HYD/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2516 (ITAT-HYDERABAD)
• Duration Of Justice: 11 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-02-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 14-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N SWAPNA
• Assessee Lawyers: M V ANIL KUMAR
• Keywords: Business income; Depreciation; Principle of natural justice
• Section: 37

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH B', HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI V. DURGA RAO, JUDICIAL MEMBER ITA NOS. 483, 484 & 485/HYD/2017 AYS: 2009-10, 2011-12 AND 2012-13 TELLAPUR TECHNOCITY PVT. LTD., HYDERABAD. PAN AACCT6507E VS. DY. COMMISSIONER OF INCOME-TAX, CIRCLE -2(2), HYDERABAD. APPELLANT RESPONDENT ASSESSEE BY: SHRI M.V. ANIL KUMAR REVENUE BY: SMT. N. SWAPNA DATE OF HEARING: 15/02/2018 DATE OF PRONOUNCEMENT: 16/02/2018 O R D E R PER V. DURGA RAO, J.M: THESE APPEALS FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDERS OF CIT(A) 2, HYDERABAD, ALL D ATED, 29/06/2016 FOR THE AYS 2009-10, 2011-12 AND 2012-13 . AS IDENTICAL ISSUES ARE INVOLVED IN THESE APPEALS, THE Y WERE CLUBBED AND HEARD TOGETHER AND, THEREFORE, WE DISP OSE OF THESE APPEALS BY WAY OF THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. THE GROUNDS, AS RAISED IN AY 2009-10 IN ITA NO. 483/HYD/2017, WHICH ARE COMMON IN ALL THE APPEALS U NDER CONSIDERATION EXCEPT THE QUANTUM OF ADDITION, ARE A S UNDER: 1. THE CIT(A) ERRED IN LAW AND FACTS OF THE CASE OU GHT TO HAVE PROVIDED AN OPPORTUNITY OF HEARING, BY SERV ING THE NOTICE THROUGH THE ASSESSING OFFICER. 2. THE CIT(A) AS WELL AS THE ASSESSING OFFICER OUGH T TO HAVE APPRECIATED THE FACT THAT COMMENCEMENT OF DEVELOPMENT ACTIVITY BY YOUR APPELLANT IS BY ITSELF I.T.A. NOS. 483 TO 485/HYD/2017 TELLAPUR TECHNOCITY PVT. LTD., HYD. 2 COMMENCEMENT OF BUSINESS AND OPERATING EXPENSES AND DEPRECIATION ARE ALLOWABLE EXPENSES. 3. THE CIT(A) OUGHT TO HAVE APPRECIATED THE FACT TH AT THE DEVELOPMENT COST WRITTEN OFF PERTAINING TO THE REDUCTION IN LAND AREA IS IN THE COURSE OF BUSINESS AND FOR THE PURPOSE OF BUSINESS, YOUR APPELLANT SUBMITS THAT THE SAME SHOULD BE ALLOWED AS DEDUCTION UNDER SECTI ON 37 OF THE INCOME TAX ACT, 1961. 4. THE CIT(A) ERRED IN LAW IN CONSIDERING INTEREST INCOME AS 'INCOME FROM OTHER SOURCES' IGNORING THE FACT TH AT SUCH INTEREST HAS BEEN EARNED IN THE COURSE OF BUSI NESS AND FOR THE PURPOSE OF BUSINESS, OUGHT TO HAVE CONSIDERED THE SAME AS BUSINESS INCOME. 5. YOUR APPELLANT WITHOUT PREJUDICE TO THE ABOVE ALTERNATIVELY SUBMITS THAT INTEREST EARNED DURING T HE YEAR UNDER CONSIDERATION SHOULD BE REDUCED FROM THE COST OF DEVELOPMENT, ADDED TO THE WORK IN PROGRESS AND THE SAME CANNOT BE BROUGHT TO TAX AS INCOME FROM OTHER SOURCES. FOR THESE AND SUCH OTHER GROUNDS THAT MAY BE URGED AT THE TIME OF HEARING YOUR APPELLANT PRAYS THAT ADDIT ION MAY BE DELETED. 3. WHEN THESE APPEALS ARE TAKEN UP FOR HEARING, LD. COUNSEL FOR THE ASSESSE SUBMITTED THAT THE CIT(A) H AS PASSED AN EX-PARTE ORDER AND, HENCE, THE ASSESSEE COULD NO T SUBSTANTIATE ITS CLAIM BY ADVANCING ITS ARGUMENTS B EFORE THE CIT(A). HE, THEREFORE, SUBMITTED THAT ONE MORE OPPO RTUNITY MAY BE GIVEN TO THE ASSESSEE TO SUBSTANTIATE ITS CA SE BEFORE THE CIT(A). 4. LD. DR, ON THE OTHER HAND, OBJECTED TO THE SUBMI SSIONS MADE BY THE LD. COUNSEL. 5. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD AS WELL AS GONE THROUGH THE ORDE RS OF REVENUE AUTHORITIES. AS THE ASSESSEE FAILED TO APPE AR BEFORE THE CIT(A) AND ARGUE ITS CASE ON MERITS, IN THE INT EREST OF I.T.A. NOS. 483 TO 485/HYD/2017 TELLAPUR TECHNOCITY PVT. LTD., HYD. 3 NATURAL JUSTICE, WE ARE OF THE VIEW THAT ONE MORE O PPORTUNITY MAY BE GIVEN TO THE ASSESSEE TO ARGUE ITS CASE BEFO RE THE CIT(A). ACCORDINGLY, THE IMPUGNED ORDERS OF CIT(A) ARE SET ASIDE AND THE APPEALS ARE RESTORED BEFORE HIM. THE CIT(A) IS DIRECTED TO PROVIDE AN OPPORTUNITY TO THE ASSESSEE TO PUT-FORTH ITS ARGUMENTS BEFORE HIM AND THEREAFTER DECIDE THE APPEALS IN ACCORDANCE WITH LAW AND ON MERITS. THE ASSESSEE IS DIRECTED TO COOPERATE WITH THE CIT(A) WITHOUT TAKING ANY ADJ OURNMENT WHEN THE APPEALS ARE FIXED FOR HEARING BY THE CIT(A ). 6. IN THE RESULT, ALL THE APPEALS OF THE ASSESSEE A RE TREATED AS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON 16 TH FEBRUARY, 2018. SD/- (B. RAMAKOTAIAH) ACCOUNTANT MEMBER SD/- (V. DURGA RAO) JUDICIAL MEMBER HYDERABAD, DATED 16 TH FEBRUARY, 2018 KV COPY FORWARDED TO: 1. TELLAPUR TECHNOLOGY PVT. LTD., C/O. M. ANANDAM & CO., CAS, 7A, SURYA TOWERS, SD ROAD, SCUNDERABAD 500 003. 2. ITO, WARD 2(4), HYDERABAD. 3. CIT(A) - 2, HYDERABAD 4 PR. CIT 2, HYDERABAD 5 THE DR, ITAT, HYDERABAD 6 GUARD FILE