DCIT, New Delhi V. M/s. Utkarsh Realtech Pvt. Ltd., New Delhi

ITA 508/DEL/2015

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 2797 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 10 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-12-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2010-2011
• Appeal Filed On: 23-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: AJAY BHAGWANI
• Keywords: Loose papers
• Section: 153A; 132

Judgement Text

ITA NO. 508/DEL/2015 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: H NEW DELHI BEFORE SHRI N.K. SAINI, ACCOUNTANT MEMBER & SHRI K.N. CHARY, JUDICIAL MEMBER ITA NO.-508/DEL/2015 ( ASSESSMENT YEAR: 2010-11) DCIT CENTRAL CIRCLE 32 NEW DELHI. VS UTKARSH REALTECH PVT. LTD. M-11, MIDDLE CIRCLE, CONNAUGHT CIRCUS, NEW DELHI. AABCU0945J ASSESSEE BY SH. AJAY BHAGWANI, CA REVENUE BY SH. MUNISH KUMAR GUPTA, CIT DR ORDER PER K. NARSIMHA CHARY, J.M. AGGRIEVED BY THE ORDER DATED 30.10.2014 IN APPEAL N O. 269/13-14/1420 PASSED BY THE LD. COMMISSIONER OF IN COME TAX (APPEALS)-XXXIII, NEW DELHI, REVENUE PREFERRED THIS APPEAL. 2. RELEVANT FACTS AS COULD BE GATHERED FROM THE ORD ERS OF THE AUTHORITIES BELOW AND AS PLEADED BY THE ASSESSEE, A RE THAT THE ASSESSEE COMPANY WAS INCORPORATED ON 06/07/2009 AND IS AN ASSOCIATE OF BPTP GROUP OF COMPANIES. THERE WAS A S EARCH UNDER SECTION 132 OF THE ACT ON 15/11/2007 ON BPTP GROUP OF COMPANIES. AT SUCH TIME, BASING ON THE SEIZED DOCUM ENTS, THE DATE OF HEARING 19.12.2017 DATE OF PRONOUNCEMENT 20.12.2017 ITA NO. 508/DEL/2015 2 ASSESSING OFFICER OPINED THAT THE BPTP GROUP OF COM PANIES ARE PAYING UNACCOUNTED INTEREST PAYMENT ON POST DATED C HEQUES AND MADE ADDITION ON THAT ACCOUNT. SUBSEQUENTLY THE RE WAS ANOTHER SEARCH OPERATION ON 07/12/2010, AND A NOTIC E UNDER SECTION 153A OF THE ACT WAS ISSUED TO THE ASSESSEE , PURSUANT TO WHICH THE ASSESSEE FILED THEIR RETURN OF INCOME ON 23/01/2012. IN THE CASE OF THE ASSESSEE ALSO LD. AO MADE ADDITI ON OF RS. 37,40,069/-ON ACCOUNT OF INTEREST ON POST DATED CHE QUES. DURING THE APPEAL, LD. CIT(A) OBSERVED THAT IN THE EARLIER MATTERS RELATING TO THE BPTP GROUP OF COMPANIES, AF TER CONSIDERING THE EVIDENTIAL VALUE OF THE SEIZED DOCU MENTS AS A RESULT OF SEARCH, HE FOUND THAT THE BPTP GROUP OF C OMPANIES ARE PAYING UNACCOUNTED INTEREST PAYMENT ON POST DATED C HEQUES, AND WHILE FOLLOWING THE SAME HE OBSERVED THAT, CONS IDERING THE FACT THAT AT THE TIME OF ENTERING THE CONVEYANCE DE ED, THERE MAY BE AGREED CONSIDERATION IN THE FORM OF POST DATED C HEQUES & CALCULATION OF INTEREST IS INHERENT WHILE COMPUTING THE CONSIDERATION. HE FURTHER OBSERVED THAT IF SUCH PE RIOD FOR POST DATED CHEQUES ARE EXTENDED, THE SELLER OF THEIR LAN D WOULD DEFINITELY DEMAND COMPENSATION FOR THE DELAY AS SUC H, HE DIRECTED THE ASSESSING OFFICER TO COMPUTE UNACCOUNT ED INTEREST ON POST DATED CHEQUES GIVEN TO THE FARMERS ON SIMIL AR LINES AS ITA NO. 508/DEL/2015 3 GIVEN IN HIS FINDINGS IN ITA NO. 521/09-10/309 I.E. , LD. CIT (A), THEREFORE, DIRECTED THE AO TO RE-COMPUTE THE INTERE ST ON PDC EITHER ON THE SALE CONSIDERATION OR ADDITIONAL PAYM ENT TO THE EXTENT OF EXTENDED PERIOD OF PDCS BY THE AO AND IN CASE THE WORKING OUT OF THE SAME IS NOT POSSIBLE, TO RE-COMP UTE THE INTEREST ON PDCS AFTER SIX MONTHS FROM THE DATE OF ISSUE OF PDCS I.E. DATE OF SALE, AS SIX MONTHS IS TAKEN AS R EASONABLE PERIOD FOR GIVING PDC AS PER SALE DEED. AGGRIEVED B Y THIS FINDING OF THE LD. CIT(A) , THE REVENUE IS IN APPEAL BEFORE US. 3. LD. DR VEHEMENTLY RELIED UPON THE ASSESSMENT ORD ER, WHEREAS PER CONTRA, LD. AR SUBMITTED BEFORE US THAT IN RESPECT OF THE INTEREST ON PDCS, WHEN A SIMILAR ADDITION WA S MADE IN THE CASE OF M/S IAG PROMOTERS AND DEVELOPERS PVT. L TD., A COORDINATE BENCH OF THIS TRIBUNAL IN ITA NO. 1674/D EL/2013, VIDE ORDER DATED 31.10.2014 EXAMINED THE ISSUE AT L ENGTH AND REACHED A CONCLUSION THAT THE DIRECTIONS GIVEN BY T HE LD. CIT (A) TO RECALCULATE THE INTEREST ON PDCS WAS ON A SOUND LOGIC AND WAS UPHELD. PER CONTRA, 4. ON THIS ASPECT OF INTEREST ON PDCS, IT IS AN ADM ITTED FACT THAT THE ASSESSEE IS A PART OF BPTP GROUP AND SIMIL AR ADDITIONS WERE MADE IN RESPECT OF MANY GROUP ENTITIES. SOME M ATTERS ITA NO. 508/DEL/2015 4 WERE DISPOSED OF BY THE TRIBUNAL ALSO. WE HAVE PER USED THE ORDER OF A COORDINATE BENCH OF THIS TRIBUNAL IN M/S IAG PROMOTERS AND DEVELOPERS PVT. LTD (SUPRA). THE OBSE RVATIONS OF THE TRIBUNAL, VIDE PARAGRAPH NO. 5 ARE AS FOLLOWS: AFTER EXAMINING THE LOOSE PAPERS SEIZED AT THE TIM E OF SEARCH AT THE ASSESSEE'S PREMISES, IT WAS NOTICED THAT INTERE ST IS PAID ON THE PDCS ONLY DURING THE PERIOD OF EXTENSION OF PDC S AND, THEREFORE, HE DIRECTED THE ASSESSING OFFICER TO REC OMPUTED THE INTEREST ON PDCS AT THE TIME OF EXTENSION OF THE PDCS. HE HAS FURTHER OBSERVED THAT IF IT IS NOT POSSIBLE TO WORK OUT THE EXTENSION OF PDCS IN EACH CASE, THEN THE ASSESSING OFFICER IS DIRECTED TO RECOMPUTED INTEREST ON PDCS AFTER SIX MONTHS FROM THE DATE OF ISSUE OF THE PDCS. THEREFORE, THE GROUND OF APPEAL OF THE REVENUE THAT THE CIT(A) DELETED THE ADDITION OF RS. 5,06,625/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF INTEREST ON PDC S IS FACTUALLY INCORRECT AND CONTRARY TO THE ORDER OF THE CIT(A). THE CIT(A) DIRECTED TO RECALCULATE THE INTEREST ON PDCS AND TH ERE WAS A SOUND LOGIC FOR SUCH DIRECTION. HIS DIRECTION IS BAS ED ON MATERIAL FOUND AND SEIZED AT THE TIME OF SEARCH. IN VIEW OF TH E ABOVE, WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDER OF LEARNED CIT(A) IN THIS REGARD 5. NO MATERIAL IS BROUGHT TO OUR NOTICE ON THIS ASP ECT TO TAKE A CONTRARY VIEW FROM THE ONE TAKEN ABOVE. WE, THERE FORE, WHILE RESPECTFULLY FOLLOWING THE ABOVE, UPHELD THE FINDIN GS OF THE LD. CIT (A) AND DISMISS THE GROUNDS OF APPEAL OF REVENU E. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN THE OPEN COURT ON 20.12.2017 SD/- SD/- (N.K. SAINI) (K. NARSIMHA CHARY) ACCOUNTANT MEMBER JUDICIAL MEMB ER DATED: 20.12.2017 *KAVITA ARORA ITA NO. 508/DEL/2015 5 COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT TRUE COPY ASSISTANT REGISTRAR ITAT NEW DELHI