Shri B.Murugeswaran, CHENNAI V. DCIT, CHENNAI

ITA 503/CHNY/2009

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86290 (ITAT-CHENNAI)
• Duration Of Justice: 5 year(s) 9 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2005-2006
• Appeal Filed On: 13-04-2009
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: RU GEORGE
• Assessee Lawyers: DR ANITA SUMANTH
• Keywords: Revision of order

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI .. , ! , ' #$ BEFORE SHRI B.R. BASKARAN, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER ./ ITA NOS. 502 & 503/MDS/2009 ' % &% / ASSESSMENT YEARS : 2004-05 & 2005-06 SHRI B. MURUGESWARAN, 50, B.B. ROAD, VYASARPADI, CHENNAI - 600 039. PAN : ADJPM 1232 A V. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE XI, CHENNAI - 600 006. (!(/ APPELLANT) (*+!(/ RESPONDENT) !( , - / APPELLANT BY : DR. ANITA SUMANTH, ADVOCATE *+!( , - / RESPONDENT BY : MS. RUBY GEORGE, CIT-DR . , / / DATE OF HEARING : 05.02.2015 01& , / / DATE OF PRONOUNCEMENT : 05.02.2015 / O R D E R PER B.R. BASKARAN, ACCOUNTANT MEMBER: THE ASSESSEE HAS FILED THESE TWO APPEALS CHALLENG ING THE REVISION ORDERS PASSED BY LD CIT-IX, CHENNAI AND TH EY RELATE TO THE ASSESSMENT YEARS 2004-05 AND 2005-06. 2. THE LD COUNSEL APPEARING FOR THE ASSESSEE DR. AN ITA SUMANTH SUBMITTED THAT THE LD CIT HAS INITIATED REV ISION PROCEEDINGS ON THE GROUND THAT THE DEDUCTION U/S 80 IB(10) OF THE 2 I.T.A. NOS.502 & 503/MDS/09 ACT HAS BEEN WRONGLY ALLOWED TO THE ASSESSEE IN BOT H THE YEARS AND THE SAME HAS RENDERED THE ASSESSMENT ORDER ERRONEOU S AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. THE L D A.R SUBMITTED THAT THE LD CIT HAS HELD SO FOR THE FOLLOWING THREE REASONS:- (A) THE ASSESSEE HAS NOT FILED THE AUDIT REPORT IN FORM NO.10CCB AS REQUIRED TO BE FILED IN TERMS OF THE PROVISIONS OF SEC. 80IB. (B) COPY OF APPROVAL OBTAINED FOR THE PROJECT FROM THE LOCAL AUTHORITY HAS NOT BEEN PLACED ON RECORD. (C) NO EVIDENCE TO SHOW THAT THE PALLAVARAM HOUSI NG PROJECT HAS BEEN COMPLETED WITHIN THE TIME PERIOD PRESCRIBED IN SEC. 80IB(10) OF THE ACT. (D) THE ASSESSEE, PRIMA FACIE, WAS NOT EXCLUSIVE DEVELOPER OF THE SAID PROJECT. THE ASSESSEE MAY BE UNDERTAKING A WO RK CONTRACT. 3. THE LD COUNSEL SUBMITTED THAT THE ASSESSEE H AS FURNISHED COPIES OF FORM NO.10CCB BEFORE THE ASSESSING OFFICE R DURING THE COURSE OF ASSESSMENT PROCEEDINGS RELATING TO THE AY 2004-05 AND THE SAID REPORT WAS FILED ALONG WITH THE RETURN OF INCOME FILED FOR AY 2005-06. SHE FURTHER SUBMITTED THAT THE ASSESSEE H AS ALSO FILED COPIES OF THE SAID REPORTS IN THE ASSESSMENT PROCEE DINGS COMPLETED IN CONSEQUENCE TO THE REVISION ORDERS. SHE FURTHER SUBMITTED THAT THE COPIES OF AUDIT REPORTS ARE ALSO PLACED IN THE PAPER BOOK FILED BEFORE THE TRIBUNAL. SHE FURTHER SUBMITTED THAT TH E PROPOSITION THAT NON-FILING OF AUDIT REPORT IS ONLY A TECHNICAL BREA CH, WHICH CAN BE MADE GOOD AT THE LEVEL OF APPELLATE PROCEEDINGS ALS O IS WELL SETTLED NOW. 3 I.T.A. NOS.502 & 503/MDS/09 4. THE LD A.R FURTHER PLACED RELIANCE ON THE DE CISIONS RENDERED BY HONBLE MADRAS HIGH COURT IN THE CASES OF CIT VS . JAIN HOUSING & CONSTRUCTION LTD (256 CTR (MAD) 408) AND CIT VS. SANGHVI AND DOSHI ENTERPRISE (2013)(255 CTR (MAD) 156) TO CONTE ND THAT THE OTHER VIEWS EXPRESSED BY LD CIT(APPEALS) ARE ALSO N OT SUSTAINABLE. THE LD A.R FURTHER SUBMITTED THAT THE ASSESSEE HAS BEEN FOLLOWING PERCENTAGE COMPLETION METHOD FOR DECLARING INCOME A ND HENCE THE QUESTION OF COMPLETION CERTIFICATE SHALL NOT ARISE DURING THE YEARS UNDER CONSIDERATION. SHE FURTHER SUBMITTED THAT TH E ASSESSEE HAD COMPLETED THE PROJECT IN THE SUBSEQUENT YEARS. ACC ORDINGLY SHE CONTENDED THAT THE IMPUGNED REVISION ORDERS ARE LIA BLE TO BE SET ASIDE. 5. ON THE CONTRARY, THE LD D.R SUBMITTED THAT T HE ASSESSING OFFICER HAS NEITHER MADE ANY ENQUIRY NOR APPLIED HI S MIND WITH REGARD TO THE CLAIM OF DEDUCTION U/S 80IB(10) OF TH E ACT IN THE TWO YEARS UNDER CONSIDERATION. BY PLACING RELIANCE ON THE DECISION OF MALABAR INDUSTRIAL COMPANY (243 ITR 83), THE LD D.R SUBMITTED THAT THE LACK OF ENQUIRY ON THE PART OF THE ASSESSI NG OFFICER WOULD RENDER THE ASSESSMENT ORDER ERRONEOUS AND PREJUDICI AL TO THE INTERESTS OF THE REVENUE. 4 I.T.A. NOS.502 & 503/MDS/09 6. IN THE REJOINDER, THE LD A.R SUBMITTED THAT THE LD CIT HAS ALMOST DECIDED ON THE ALL ISSUES RAISED BY HIM AND HENCE THE IMPUGNED REVISION ORDERS WILL NOT GIVE ANY FURTHER SCOPE TO THE ASSESSING OFFICER TO TAKE A DIFFERENT VIEW. 7. HAVING HEARD THE RIVAL SUBMISSIONS, WE FIND MERIT IN THE CONTENTIONS OF LD D.R., SINCE IT IS AN ADMITTED FAC T THAT THE ASSESSING OFFICER DID NOT MAKE ANY ENQUIRY ABOUT TH E DEDUCTION CLAIMED BY THE ASSESSEE U/S 80IB(10) OF THE ACT. W E ALSO DO NOT FIND ANY DISCUSSION ABOUT THE SAME IN THE ASSESSMEN T ORDER. DURING THE COURSE OF HEARING, THE LD A.R SUBMITTED THAT THE ASSESSING OFFICER ONLY MADE ORAL ENQUIRIES, BUT THE SAID SUBMISSION COULD NOT BE ENTERTAINED IN THE ABSENCE OF ANY EVID ENCE. HENCE, IT LEADS US TO THE CONCLUSION THAT THE ASSESSING OFFIC ER DID NOT MAKE ANY ENQUIRY WITH REGARD TO THE DEDUCTION CLAIMED U/ S 80IB(10) OF THE ACT AND THE SAME RENDERS THE ASSESSMENT ORDER ERRON EOUS AND PREJUDICIAL TO THE INTERESTS OF THE REVENUE. 8. HOWEVER, THE LD A.R SUBMITS THAT THE VIEWS E XPRESSED BY LD CIT LEAVES NO SCOPE TO THE AO TO MAKE FURTHER ENQUI RIES, ACCORDING TO LD A.R, THE VARIOUS DEFICIENCIES POINTED OUT BY THE LD CIT HAS SINCE BEEN SETTLED BY THE DECISION OF HONBLE JURIS DICTIONAL HIGH COURT. THERE CANNOT BE ANY DISPUTE THAT THE DECISI ON OF 5 I.T.A. NOS.502 & 503/MDS/09 JURISDICTIONAL HIGH COURT IS BINDING ON THE ASSESSI NG OFFICER. ACCORDINGLY, WE ARE OF THE VIEW THAT THE ASSESSING OFFICER SHOULD PROCEED TO PASS THE ASSESSMENT ORDER IN ACCORDANCE WITH THE LAW UNTRAMMELED BY THE VIEWS EXPRESSED BY LD CIT. ACCO RDINGLY WE DIRECT THE ASSESSING OFFICER TO PASS THE ASSESSMENT ORDERS BY DULY CONSIDERING THE CASE LAWS RELIED UPON BY THE ASSESS EE, THE AUDIT REPORTS FURNISHED BY THE ASSESSEE AND OTHER INFORMA TION AND EXPLANATIONS THAT MAY BE FURNISHED BEFORE HIM WITHO UT BEING INFLUENCED BY THE VIEWS EXPRESSED BY LD CIT IN THE IMPUGNED REVISION ORDERS. THE ORDERS OF LD CIT STANDS MODIF IED TO THAT EXTENT. 9. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASSESSEE ARE TREATED AS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AFTER CONCLUSI ON OF HEARING ON THE 5 TH DAY OF FEBRUARY, 2015 AT CHENNAI. SD/- SD/- ( ! ) ( .. ) (VIKAS AWASTHY) (B.R. BASKARAN) ' /JUDICIAL MEMBER /ACCOUNTANT MEMBER /CHENNAI, A /DATED, THE 5 TH FEBRUARY, 2015. KRI. 6 I.T.A. NOS.502 & 503/MDS/09 B , *'/C D &/ /COPY TO: 1. !( /APPELLANT 2. *+!( /RESPONDENT 3. . E/ /CIT-IX, CHENNAI 4. FG *'/' /DR 5. GH% I /GF.