Addl. CIT, Ghaziabad V. M/s. Shipra EstateLtd., Ghaziabad

ITA 5250/DEL/2010

• Counselvise Citation: 525020114 RSA 2010
• Duration Of Justice: 4 year(s) 3 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 19-03-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 01-01-2015
• Assessment Year: 2003-2004
• Appeal Filed On: 25-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: B R R KUMAR
• Keywords: Depreciation; Business expenditure; Benefit of exemption
• Section: 80IB; 6; 10; 154

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G NEW DELHI) BEFORE SHRI I.C. SUDHIR AND SHRI B.C. MEENA ITA NO. 5250/DEL/2010 ASSESSMENT YEAR: 2003-04 ADDITIONAL CIT, VS. SHIPRA ESTATE LTD., RANGE-2, C-36, PATEL NAGAR, GHAZIABAD. GHAZIABAD. (PAN: AACCS6116J ) (APPELLANT) (RESPONDENT) ITA NO. 5588/DEL/2010 ASSESSMENT YEAR: 2003-04 SHIPRA ESTATE LTD., VS. ADDITIONAL CIT, C-36, PATEL NAGAR, RANGE-I, GHAZIABAD. GHAZIABAD. (PAN: AACCS6116J ) (APPELLANT) (RESPONDENT) REVENUE BY: SHRI PRATEEK GUPTA, CA ASSESSEE BY: SHRI BRR KUMA R, SR.DR DATE OF HEARING : 01.01.2015 DATE OF PRONOUNCEMENT: 19.03.2015 ORDER PER I.C. SUDHIR: JUDICIAL MEMBER IN THESE CROSS-APPEALS, THE REVENUE HAS PREFERRED T HE APPEAL AGAINST THE FIRST APPELLATE ORDER ON THE FOLLOWING GROUNDS: 1. THE LEARNED CIT(APPEALS) HAS ERRED IN LAW AND O N FACTS BY ALLOWING THE DEDUCTION U/S. 80IB(10) AMOUNTING TO R S.1,19,04,619 IN RESPECT OF SUB PROJECTS NAMELY BRAHMPUTRA, KAVERI, AMRAVATI AND DAMODAR WHICH ARE THE PART OF MAIN PROJECT I.E. SHI PRA RIVIERA IN WHICH THE DEVELOPMENT AND CONSTRUCTION WORK WAS STA RTED BEFORE IST 2 OCTOBER, 1998 AND ASSESSEE DID NOT FULFILL THE REQU ISITE CONDITIONS AS LAID DOWN IN SEC. 80IB(10) OF I.T. ACT, 1961, HENCE THE ORDER OF A.O. BE RESTORED AND CIT(A) BE SET ASIDE. 2. THAT THE LEARNED CIT(APPEALS) HAS ERRED IN LAW A ND ON FACTS BY ALLOWING THE DEDUCTION UNDER SEC. 80IB(10), IGNORIN G THE FACT THAT ASSESSEE HAD STARTED THE CONSTRUCTION ACTIVITIES PR IOR TO 01.10.1998 AND WAS NOT FULFILLING THE CONDITIONS AS LAID DOWN UNDE R SEC. 80IB(10) OF THE I.T. ACT, 1961. 3. THAT THE LEARNED CIT(APPEALS) HAS ERRED ON FACTS AND IN LAW IN ALLOWING THE DEDUCTION UNDER SEC. 80IB(10) ON THE P ART OF THE PROJECT TREATING IT A SEPARATE PROJECT, WHILE APPROVAL OF T HE WHOLE PROJECT AND CONSTRUCTION WAS STARTED PRIOR TO 01.10.1998. 4. THAT THE ORDER OF THE LEARNED CIT(APPEALS) DESER VES TO BE SET ASIDE AND THE ORDER OF THE A.O. BE RESTORED. 2. AT THE OUTSET OF HEARING, THE LEARNED AR POINTED OUT THAT THE ISSUE RAISED IN THE GROUNDS QUESTIONING THE ACTION OF THE LEARNED CIT(APPEALS) IN ALLOWING THE CLAIMED DEDUCTION UNDER SEC. 80IB(10) OF THE INCOME-TAX ACT, 1961 IN RESPECT OF THE SUB-PROJECTS, NAMELY, BRAHAM PUTRA, KAVERI, AMRAVATI AND DAMODAR WHICH ARE THE PART OF THE MAIN PROJECT SHIPRA RIVIERA IS COVERED BY THE ORDER DATED 30.10.2009 OF THE DELHI BENCH OF THE ITAT IN THE CASE OF ASSESSEE ITSELF FOR THE ASSESSMENT YEARS 20 00-01, 2001-02 AND 2002- 3 03 IN ITA NOS.4628/DEL/2003. 3719/DEL/2004 & 1329/D EL/2005, A COPY WHEREOF HAS BEEN MADE AVAILABLE ON RECORD. THE LEAR NED AR REFERRED PARA NOS.17 TO 26 OF THE SAID ORDER OF THE ITAT IN SUPPO RT. THE LEARNED AR POINTED FURTHER THAT THE SAME ISSUE HAS AGAIN DECID ED IN FAVOUR OF THE ASSESSEE BY THE ITAT FOR THE ASSESSMENT YEAR 2004-0 5 AND 2006-07 VIDE ORDER DATED 03.12.2010 IN ITA NOS.2613, 2614, 2739 AND 2741/DEL/2010. A COPY OF THIS ORDER HAS ALSO BEEN FURNISHED FOR A RE ADY REFERENCE. 3. THE LEARNED SR. DR DID NOT DISPUTE THE ABOVE SUB MISSIONS. HE, HOWEVER, PLACED RELIANCE ON THE ASSESSMENT ORDER. 4. THE FACTS IN BRIEF ARE THAT ASSESSEE IS A LIMITE D COMPANY ENGAGED IN THE CONSTRUCTION ACTIVITIES. DURING THE YEAR, THE A SSESSEE IN JOINT VENTURE WITH GHAZIABAD DEVELOPMENT AUTHORITY (GDA) WAS ENGAGED I N THE BUSINESS OF DEVELOPMENT AND CONSTRUCTION OF HOUSES OF DIFFERENT CATEGORIES. THE ASSESSEE COMPANY HAD UNDERTAKEN THE COMMENCEMENT OF CONSTRU CTION ON TWO MAJOR COMPLEXES MAINLY M/S. SHIPRA RIVIERA AT INDIRAPURAM AND M/S. SHIPRA SUN CITY AT INDRAPURAM. EACH COMPLEX WAS FURTHER SUB-DI VIDED IN TWO SMALL PROJECTS CONSISTING OF NUMBER OF FLATS OF VARIOUS S IZES. THE SHIPRA RIVIERA COMPLEX WAS SUB-DIVIDED INTO SIX PROJECTS WHILE SHI PRA SUN CITY COMPLEX WAS SUB-DIVIDED INTO FIVE PROJECTS. THE DEVELOPMENT AND CONSTRUCTION OF 4 FOUR PROJECTS, NAMELY, BRAHAMPUTRA, KAVERI, AMRAVAT I AND DAMODAR IN SHIPRA RIVIERA COMPLEX WERE CLAIMED TO HAVE BEEN CO MMENCED AFTER 01.10.1998. THE DEVELOPMENT AND CONSTRUCTION OF SHI PRA SUN CITY COMPLEX WAS CLAIMED TO HAVE BEEN UNDERTAKEN IN THE YEAR 199 9. THE ASSESSEE HAD CLAIMED BENEFIT OF TAX HOLIDAYS RELIEF AS AVAILABLE UNDER SEC. 80IA(4F) AND 80IB (10) OF THE INCOME-TAX ACT, 1961. THERE WAS NO DISPUTE ABOUT THE TAX HOLIDAY BENEFIT IN RESPECT OF SHIPRA SUN CITY COMPL EX, HOWEVER, THE ASSESSING OFFICER DISALLOWED THE CLAIMED BENEFIT IN RESPECT OF BRAHAMPUTRA, KAVERI, AMRAVATI AND DAMODAR PROJECTS FALLING IN SH IPRA RIVIERA COMPLEX. THE ASSESSING OFFICER OBSERVED THAT THE DEVELOPMENT AND CONSTRUCTION ON THE ABOVE PROJECTS IN SHIPRA RIVIERA COMPLEX HAD CO MMENCED MUCH BEFORE THE PRESCRIBED DATES AS CONTAINED UNDER THE PROVISI ONS OF SEC. 80IA(4F) AND SECTION 80IB(10) OF THE ACT. THE LEARNED CIT(APPEAL S) FOLLOWING THE DECISION OF ITAT ON AN IDENTICAL ISSUE IN THE CASE OF ASSESSEE ITSELF FOR THE ASSESSMENT YEAR 2000-01 TO 2002-03 HAS ALLOWED THE CLAIMED DEDUCTION UNDER SEC. 80IB OF THE ACT IN RESPECT OF THE ABOVE SAID PROJECTS WITH DIRECTION TO THE ASSESSING OFFICER TO DELETE THE DI SALLOWANCE OF RS.1,19,04,619 MADE IN THIS REGARD. 5 5. HAVING GONE THROUGH THE ORDERS OF THE AUTHORITIE S BELOW AS WELL OF THE ITAT IN THE CASE OF ASSESSEE ITSELF, CITED ABOVE, W E FIND THAT UNDER SIMILAR SET OF FACTS, THE ITAT AFTER DEALING IN DETAIL HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE FOR THE ASSESSMENT YEAR 2000-01 & 2 001-02 (SUPRA). FOR A READY REFERENCE, PARA NOS. 17 TO 26 THEREOF ARE BEI NG REPRODUCED HEREUNDER: 17. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND HAVE GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND THE RELEVANT PROVISION OF LAW. SECTION 80LA INSERTED BY FINANCE (NO.2) ACT 1991, SUB- SECTION (4F) DURING THE RELEVANT ASSESSMENT YEAR RE ADS AS UNDER:- 80LA(4F) THIS SECTION APPLIES TO AN UNDERTAKING, E NGAGED IN DEVELOPING AND BUILDING HOUSING PROJECTS APPROVED B Y A LOCAL AUTHORITY SUBJECT TO THE CONDITION THAT THE SIZE OF THE PLOT OF LAND HAS A MINIMUM AREA OF ONE ACRE, AND THE RESIDENTIAL UNIT HAS A BUILT UP AREA NOT EXCEEDING ONE THOUSAND SQUARE FEET: PROVIDED THAT THE UNDERTAKING COMMENCES DEVELOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT ON OR AFTER THE 1 ST DAY OF OCTOBER, 1998 AND COMPLETES THE SAME BEFORE THE 31 ST DAY OF MARCH, 2001. 18. SUBSEQUENTLY, SECTION 80LA WAS SUBSTITUTED BY SECTION 80LA AND SECTION 80IB BY FINANCE ACT, 1999 W.E.F. 1.4.20 00. SUB-SECTION 10 OF SECTION 80IB AT THE RELEVANT TIME READS AS UN DER:- '80IB(10) THE AMOUNT OF DEDUCTION IN THE CASE OF AN UNDERTAKING DEVELOPING AND BUILDING HOUSING PROJECTS APPROVED BEFORE THE 31 ST 6 DAY OF MARCH,2008 BY A LOCAL AUTHORITY SHALL BE HU NDRED PER CENT OF THE PROFITS DERIVED IN THE PREVIOUS YEAR RELEVANT T O ANY ASSESSMENT YEAR FROM SUCH HOUSING PROJECT IF (A) SUCH UNDERTAKING HAS COMMENCED OR COMMENCES DEV ELOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT ON OR AFTER THE 1 ST DAY OF OCTOBER, 1998 AND COMPLETES SUCH CONSTRUCTION,- (I)IN A CASE WHERE A HOUSING PROJECTS HAS BEEN APPR OVED BY THE LOCAL AUTHORITY BEFORE THE 1 ST DAY OF APRIL, 2004, ON OR BEFORE THE 31 ST DAY OF MARCH, 2008; (II) IN A CASE WHERE A HOUSING PROJECT HAS BEEN, OR , IS APPROVED BY THE LOCAL AUTHORITY ON OR AFTER THE 1 ST DAY OF APRIL, 2004, WITHIN FOUR YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE HOU SING PROJECT IS APPROVED BY THE LOCAL AUTHORITY. EXPLANATION-FOR THE PURPOSES OF THIS CLAUSE,- (I) IN A CASE WHERE THE APPROVAL IN RESPECT OF THE HOUSING PROJECT IS OBTAINED MORE THAN ONCE, SUCH HOUSING PROJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON THE DATE ON WHICH THE BUILDIN G PLAN OF SUCH HOUSING PROJECT IS FIRST APPROVED BY THE LOCAL AUTH ORITY; (II) THE DATE OF COMPLETION OF CONSTRUCTION OF THE HOUSING PROJECT SHALL BE TAKEN TO BE THE DATE ON WHICH THE COMPLETION CER TIFICATE IN RESPECT OF SUCH HOUSING PROJECT IS ISSUED BY THE LOCAL AUTH ORITY; (B) THE PROJECT IS ON THE SIZE OF A PLOT OF LAND WH ICH HAS A MINIMUM AREA OF ONE ACRE: 7 PROVIDED THAT NOTHING CONTAINED IN CLAUSE (A) OR CL AUSE (B) SHALL APPLY TO A HOUSING PROJECT CARRIED OUT IN ACCORDANCE WITH A SCHEME FRAMED BY THE CENTRAL GOVERNMENT OR A STATE GOVERNMENT FOR RECONSTRUCTION OR REDEVELOPMENT OF EXISTING BUILDINGS IN AREAS DEC LARED TO BE SLUM AREAS UNDER ANY LAW FOR THE TIME BEING IN FORCE AND SUCH SCHEME IS NOTIFIED BY THE BOARD IN THIS BEHALF; (C) THE RESIDENTIAL UNIT HAS A MAXIMUM BUILT-UP ARE A OF ONE THOUSAND SQUARE FEET WHERE SUCH RESIDENTIAL UNIT IS SITUATED WITHIN THE CITY OF DELHI OR MUMBAI OR WITHIN TWENTY-FIVE KILOMETRES FR OM THE MUNICIPAL LIMITS OF THESE CITIES AND ONE THOUSAND A ND FIVE HUNDRED SQUARE FEET AT ANY OTHER PLACE; (AND) (D) THE BUILT-UP AREA OF THE SHOPS AND OTHER COMMER CIAL ESTABLISHMENTS INCLUDED IN THE HOUSING PROJECT DOES NOT EXCEED FIV E PER CENT OF THE AGGREGATE BUILT-UP AREA OF THE HOUSING PROJECT OR T WO THOUSAND SQUARE FEET, WHICHEVER IS LESS.' 19. IT IS CRYSTAL CLEAR FROM THE ABOVE PROVISIONS THAT FOR CLAIMING EXEMPTION IN RESPECT OF PROFIT DERIVED FROM HOUSING PROJECT, FOLLOWING THREE CONDITIONS ARE REQUIRED TO BE SATISFIED:- (I) COMMENCES DEVELOPMENT AND CONSTRUCTION OF HOU SING PROJECT AFTER 1.10.1998 AND COMPLETE CONSTRUCTION BEFORE 1. 4.2004; (II) REQUIRED LAND AREA UNDER EACH PROJECT IS MORE THAN ONE ACRE. (III) BUILT-UP AREA OF HOUSE IS NOT MORE THAN 1000 SQ.FT. 20. THE ASSESSEE HAS CLAIMED FULFILLMENT OF ALL TH E CONDITIONS. THE AO WAS NOT SATISFIED WITH THE CONDITION OF COMMENCE MENT OF DEVELOPMENT AND CONSTRUCTION OF FOUR PROJECTS OF SH IPRA RIVIERA 8 COMPLEX AFTER 1.10.1998. HE THEREFORE DECLINED THE EXEMPTION CLAIMED. 21. THE ASSESSEE COMPANY HAD CLAIMED BENEFIT OF SE CTION 80LA SUBSEQUENTLY AMENDED TO 80IB IN RESPECT OF THE FOUR PROJECTS FROM OUT OF THE SHIPRA RIVIERA COMPLEX, AND IN RESPECT OF ON E PROJECT FROM OUT OF THE SHIPRA SUN CITY COMPLEX. THE INCOME DERIVED FROM OUT OF THE HOUSING PROJECTS WAS CLAIMED TO BE EXEMPT FROM TAX, SUBJECT TO THE FULFILLMENT OF THE TERMS AND CONDITIONS AS LAID OUT UNDER THE PROVISIONS OF SECTION 80IA/80IB OF THE ACT. THE AO HAS ALLOWED BENEFIT OF EXEMPTION OF INCOME TO THE SHIPRA SUN CITY COMPLEX IN RESPECT OF THE ONE PROJECT THAT WAS STATED AND COMPLETED DURING TH E FINANCIAL YEAR ENDING 31.03.2001. THE DISPUTE IS WITH REGARD TO TH E FOUR PROJECTS OF SHIPRA RIVIERA COMPLEX. THE EXEMPTION IN RESPECT OF FOUR PROJECTS UNDER SHIPRA RIVIERA COMPLEX HAS BEEN DENIED BY THE ASSESSING OFFICER. 22. IT IS CLEAR FROM THE ORDER OF THE AO THAT HE HA S BASICALLY DECLINED DEDUCTION U/S 80IA/80IB ON FOLLOWING PLEA: - I. THE ASSESSEE HAS PURCHASED THE LAND ON WHICH PRO POSED CONSTRUCTION WAS TO BE DONE PRIOR TO 01.10.1999. II. THE DEVELOPMENT AUTHORITY HAD SANCTIONED THE PL AN OF CONSTRUCTION PRIOR TO 01.10.1999. (III). THE ASSESSEE HAS ADVERTISED FOR BOOKING OF F LATS IN THE NEWSPAPER PRIOR TO THE INSERTION OF SECTION 80IA I.E. 01.10.1 998. 9 (IV). THE ASSESSEE HAS UNDERTAKEN EARTH FILLING ACT IVITY OF THE LAND SO PURCHASED FOR UNDERTAKING THE CONSTRUCTION OF THE P ROJECT PRIOR TO 01.10.1998. 23. FROM THE ORDER OF THE AO, WE FOUND THAT THE AO HIMSELF HAS OBSERVED THAT FOR THE COMMENCEMENT OF DEVELOPMENT A ND CONSTRUCTION, A PERSON MIGHT OWN LAND WHICH MAY BE ANCESTRAL OR EVEN PURCHASED PRIOR TO 01.10.1998, AND THE ASSESSEE MAY THINK OF CONSTRUCTING HOUSING PROJECT FOR AVAILING DEDUCTION U/S 80IA IN VIEW OF THE NEWLY INSERTED PROVISIONS FOR DEVELOPMENT AN D CONSTRUCTION AFTER THE SPECIFIED DATE. THUS, AS PER AO, THE DATE OF PURCHASE OF LAND ALONE CANNOT BE AND SHOULD NOT BE CONSIDERED AS A C RITERIA FOR DECIDING THE ACTUAL TIME OF COMMENCEMENT OF DEVELOPMENT AND CONSTRUCTION OF HOUSING PROJECT. SIMILARLY, THE AO HIMSELF HAS OBSE RVED AT PAGE 10 IN PARA 7.4 THAT APPROVAL OF PLAN BY THE LOWER AUTHORI TIES MAY EITHER GET AUTOMATICALLY CANCELLED FOR THE EXPIRY OF THE TIME LIMIT WHEN NO CONSTRUCTION IS CARRIED OUT, OR MAY BE CANCELLED BY THE ASSESSEE HIMSELF AT HIS OWN AND REPLACED BY A NEW PLAN DEPEN DING UPON THE CHANGED CIRCUMSTANCES. THESE OBSERVATIONS OF THE AO CLEARLY INDICATE THAT IN ALL REASONABLE PROBABILITIES THE PURCHASE O F LAND AND APPROVAL OF CONSTRUCTION PLAN MAY NOT NECESSARILY LEAD' TO T HE INFERENCE THAT THE DEVELOPMENT AND CONSTRUCTION OF 'A PROJECT HAS COMM ENCED. NOW THERE REMAINS TWO MORE REASONS WITH THE AO FOR DECL INING EXEMPTION U/S 80LA WHICH ARE BOOKING OF ADVERTISEMENT FOR SAL E OF FLAT UNDER VARIOUS PROJECTS AND EARTH FILLING ACTIVITIES ON TH E LAND ACQUIRED FOR UNDERTAKING THE CONSTRUCTION AND DEVELOPMENT THEREO N PRIOR TO 1.10.1998. IN THIS RESPECT, WE FOUND FROM THE RECOR D THAT FOUNDATION 10 LAYING CEREMONY AND BHOOMI PUJAN WAS PERFORMED BY T HE ASSESSEE ONLY AFTER THE SPECIFIED DATE I.E. 1.10.1998 AND TH AT CONSTRUCTION CONTRACTS WITH THE CONTRACTORS WERE ENTERED INTO BY THE ASSESSEE IN THE FORM OF WRITTEN AGREEMENT ONLY AFTER THE SPECIFIED DATE I.E. 1.10.1998. IN THIS RESPECT, THE OBSERVATION OF THE AO WAS THAT FOUNDATION LAYING CEREMONY CAN BE HELD AFTER THE CONSTRUCTION OF THE ENTIRE PROJECT AND THAT THERE CAN ALWAYS BE ORAL CONTRACTS WHICH MAY, BE PUT IN WRITING AT A LATER DATE TO SUIT THE CONVENIENCE OF THE ASSESSE E. IN THIS REGARD, FROM THE MATERIAL AVAILABLE ON RECORD, WE FOUND THAT THE ASSESSEE HAD UNDERTAKEN BHOOMI PUJAN WHEN THE PROJECT WAS INITIA TED AND EVEN BEFORE DIGGING THE FOUNDATION. NO CONTRARY MATERIAL WAS BROUGHT ON RECORD BY THE' AO TO SUGGEST THAT THE CONSTRUCTION ACTIVITIES WERE UNDERTAKEN PRIOR TO PERFORM BHOOMI PUJAN AND/OR THE CONSTRUCTION MATERIAL WAS AVAILABLE AT THE SITE WHEN PROJECT WAS INITIATED BEFORE BHOOMI PUJAN WAS PERFORMED. IN RESPECT OF THE OBSER VATION OF THE AO TO THE EFFECT THAT CONSTRUCTION CONTRACTS WITH THE SUB CONTRACTORS IN WRITING ALWAYS BE FRAMED FOR CONVENIENCE IS WRONG AND INCORRECT, AS NOTHING WAS BROUGHT ON RECORD BY THE 'AO TO SUBSTAN TIATE HIS ASSERTION THAT THESE AGREEMENTS WERE ENTERED INTO A FTER THE SPECIFIED DATE. THE ASSESSEE IS A BIG COMPANY AND HAD UNDERTA KEN A HUGE PROJECT WHEREIN CONSTRUCTION IS UNDERTAKEN WITH THE HELP OF THE VARIOUS SUB CONTRACTORS AND WITHOUT WRITTEN CONTRACTS, THE WORK CANNOT START AT ALL. AS IT WAS PROJECT FOR CONSTRUCTING THOUSANDS O F HOUSES, THE SAME CANNOT BE PRESUMED TO BE INITIATED WITHOUT VALID AN D WRITTEN CONTRACTS. NOTHING WAS BROUGHT ON RECORD BY THE AO TO SUBSTANT IATE HIS ASSERTION TO THIS EFFECT. AS PER OUR CONSIDERED VIEW, IN CASE OF SUCH A HUGE CONTRACTS, CONTRACTORS ARE SHORT LISTED AFTER INVIT ING TENDERS. ACTUAL 11 CONSTRUCTION CONTRACT IS AWARDED TO THEM HAND THERE AFTER ONLY CONSTRUCTION WORK STARTS. ONCE THE CONSTRUCTION IS UNDERTAKEN BY THE CONTRACTORS, THE BILLS ARE RAISED BY HIM AND THE RE QUIRED TAX AT SOURCE OUT OF EVERY PAYMENT MADE TO THE CONTRACTOR FOR EAC H SPECIFIC PROJECT, IS DEDUCTED AT SOURCES. THUS, THE PRESUMPTION OF TH E AO TO THE EFFECT THAT CONSTRUCTION CONTRACT/AGREEMENT HAS NO RELEVAN CE TO THE IMPLEMENTATION OF THE PROJECT UNDERTAKEN BY THE ASS ESSEE IS FACTUALLY INCORRECT AND NOT SUPPORTED BY ANY MATERIAL ON RECO RD. FROM THE RECORD, WE ALSO FOUND THAT DURING THE COURSE OF ASS ESSMENT PROCEEDINGS ITSELF, COMPLETE DETAILS OF ALL AGREEME NTS ENTERED INTO WITH VARIOUS CONTRACTORS, DETAILS OF PAYMENTS MADE TO THEM FOR VARIOUS PROJECTS AND THE TAX DEDUCTED AT SOURCE THEREON, HA S ALREADY BEEN FILED. THE LANGUAGE USED. IN THE SECTION IS 'DEVELOPMENT A ND CONSTRUCTION, OF HOUSING PROJECT'. THE DEVELOPMENT IS AN INTEGRAL PART OF THE CONSTRUCTION. BOTH CANNOT BE SEGREGATED. THERE IS A LWAYS DEVELOPMENT FOR A PURPOSE. HAD IT BEEN DEVELOPMENT OF INDEPENDE NT PARK ONLY, IT COULD BE DONE AT ANY POINT OF TIME. EVEN IF IT IS D EVELOPMENT OF A FARM HOUSE OR A GARDEN, IT CAN ALSO BE DONE AT ANY POINT OF TIME BUT IF IT IS DEVELOPMENT OF A HOUSING PROJECT, IT CANNOT BE SAID THAT SUCH DEVELOPMENT CAN BE UNDERTAKEN PRIOR TO UNDERTAKING OF THE CONSTRUCTION OF THE HOUSING PROJECT ITSELF. THE LAN GUAGE SO USED BY 'THE LEGISLATURE IS, THE COMMENCEMENT OF THE DEVELOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT AND THAT MEANS TO INCLUDE TH E CONSTRUCTION OF THE HOUSING PROJECT AND AFTER THE CONSTRUCTION IS C OMPLETE, THE WASTE MATERIAL' IS REMOVED THEN FOLLOWS DEVELOPMENT OF SU RROUNDINGS SUCH AS ROADS AND PARKS. IN THE INSTANT CASE, IT WAS A B IG HOUSING PROJECT WHERE SUFFICIENT HOUSES WHICH RANGED IN THOUSANDS W ERE PROPOSED TO 12 BE CONSTRUCTED. IT WAS A PROJECT WHERE SEVERAL DIFF ERENT CATEGORIES OF HOUSES WERE PROPOSED TO BE BUILT UP AND FOR UNDERTA KING CONSTRUCTION OF SUCH A HUGE HOUSING PROJECT, LOT OF DIFFERENT MA TERIAL IS REQUIRED TO BE STORED AROUND ,THE PROJECT LIKE SAND, BRICKS, RO LL, IRON AND STEEL, HUTS FOR LABOURERS ETC. FOR ALL THESE PURPOSES, THE 'AND WAS REQUIRED TO BE LEVELED OR CLEANED, BUT IT CANNOT BE TAKEN AS COMME NCEMENT OF DEVELOPMENT INSOFAR AS DEVELOPMENT ITSELF HAS NO ME ANING UNLESS IT IS IN REFERENCE TO CONSTRUCTION OF PROJECT. IN SECTION 80IA, THE LEGISLATURE HAS USED THE LANGUAGE IN A VERY SIMPLE FORM 'COMMEN CES DEVELOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT ' AND THE LEGISLATURE HAS NOT USED THE LANGUAGE 'COMMENCES DE VELOPMENT OF LAND AND CONSTRUCTION OF HOUSING PROJECT', THIS SHO WS THAT AO HAS DEVIATED HIMSELF FROM THE LANGUAGE USED IN THE SECT ION. HON'BLE DELHI HIGH COURT IN THE CASE OF M.P.PODDAR, HUF, - 156 CT R 363 OBSERVED THAT MEANING AND INTENTION OF A TAXING STATUTE MUST BE GATHERED FROM THE -PLAIN AND UNAMBIGUOUS EXPRESSION USED THEREIN RATHER THAN TO FIND OUT WHAT IS JUST OR EXPEDIENT. AFTER DISCUSSING IN LENGTH AND RECORDING A CATEGORICAL FINDING WITH RESPECT TO EACH OF THE P ROJECT UNDERTAKEN BY THE ASSESSEE FOR WHICH CLAIM WAS MADE AND ALSO THE PROJECTS FOR WHICH NO CLAIM U/S 80IA WAS MADE BY THE ASSESSEE, THE CIT (A) HELD THAT ALL THE CONDITIONS CONTAINED U/S 80IA(4F) SUBSEQUENTLY AMENDED TO SECTION 801B(10) OF THE ACT WERE COMPILED WITH, THE ASSESSEE WAS ELIGIBLE FOR CLAIM OF BENEFIT. IT WAS FURTHER OBSER VED THAT LANGUAGE USED IN THE ACT IS VERY CLEAR AND UNAMBIGUOUS WHERE IN EXEMPTION HAS BEEN GRANTED TO THE ASSESSEE IN RESPECT OF INCOME E ARNED ON BUILDING CONSTRUCTION TO PROMOTE HOUSING SECTOR WHEN UNDERTA KEN AFTER THE SPECIFIED DATE I.E. 30.9.1998. AFTER TAKING INTO AC COUNT ALL THE 13 EVIDENCES PLACED ON RECORD, THE CIT(A) HELD THAT TH E ACTIVITIES PERFORMED, IF ANY INCIDENTAL TO ACHIEVE THE MAIN OB JECT BY THE ASSESSEE COMPANY TO UNDERTAKE HOUSING CONSTRUCTION WOULD NOT SNATCH AWAY FROM HIM THE BENEFIT, OTHERWISE PROVIDED UNDER THE LAW. THUS MERE ACT OF LEVELLING THE EARTH WILL NOT AMOUNT TO CONST RUCTION OF HOUSING PROJECT WITHIN THE MEANING OF SEC 80IA(4F). THEREFO RE ASSESSEE'S ACT OF MERE LEVELLING THE EARTH PRIOR TO 30-9-1998 WILL NOT SNATCH THE DEDUCTION PERMISSIBLE ON ACCOUNT OF CONSTRUCTION OF HOUSING PROJECT WHICH WAS UNDISPUTEDLY CARRIED OUT ONLY AFTER 30-9- 1998. THE CIT(A), ALSO OBSERVED THAT THE TECHNICAL INTERPRETA TION TAKEN BY THE AO CARRIED A STATUTE AWAY FROM THE ORIGINAL MEANING AND INTENTION OF THE LEGISLATURE AND FOUND THAT EARTH FILLING ACTIVI TIES IF AT ALL PERFORMED, AT THE TIME OF STARTING OF FIRST TWO PROJECTS AND B OOKING THE AMOUNT RECEIVED IN FEW CASES WOULD NOT CHANGE THE SITUATIO N AS AVAILABLE UNDER THE LAW, INSOFAR AS MAIN CONSTRUCTION ACTIVIT IES AS MENTIONED U/S 80IA(4F) AND 80IB( 10) WERE UNDERTAKEN ONLY AFTER 3 0.9.1998. AS PER CIT(A), THE EVIDENCE FILED ON RECORD PROVED THAT CO NTRACTS FOR CONSTRUCTION OF THE FOUR PROJECTS UNDER SHIPRA RIVI ERA WAS STARTED AFTER 30.9.1998, WHEREIN EVEN FOUNDATION LAYING CEREMONY WAS ALSO PERFORMED AFTER 30.9.1998, A CATEGORICAL OBSERVATIO N WAS MADE BY THE CITCA) WITH RESPECT TO THE FINDINGS, RECORDED BY TH E AO IN HIS ASSESSMENT ORDER FOR AY 1998-99 WHEREIN AO HIMSELF HAS STATED 'IN BOLD LETTERS THAT FOUR PROJECTS IN QUESTION COMMENC ED IN THE NEXT FINANCIAL YEAR. MERELY GETTING BOOKING MONEY IN ADV ANCE IN RESPECT OF PROJECT WHICH COMMENCED DEVELOPMENT AND CONSTRUCTIO N OF HOUSING PROJECT AFTER 1ST OCTOBER,1998 WILL NOT DISENTITLE THE ASSESSEE FROM THE BENEFIT OF DEDUCTION U/S 80IA(4F)/80IB(10), IN SO F AR AS CRUCIAL 14 CONDITION IS COMMENCEMENT OF DEVELOPMENT AND CONSTR UCTION OF HOUSING PROJECT AND NOT THE RECEIPT OF BOOKING AMOU NT IN ADVANCE. IT THE COMMENCEMENT OF DEVELOPMENT AND CONSTRUCTION IS PRIOR TO 1.10.'1998, NO DEDUCTION WILL BE ALLOWED U/S 80IA(4 F)/80IB(10) NOTWITHSTANDING THE RECEIPT OF ADVANCE BOOKING MONE Y PRIOR OR SUBSEQUENT TO 1.10.1998. 24. AS PER EVIDENCE PLACED ON RECORD THE DATE OF W ORK ORDER IN RESPECT OF FOUR PROJECTS OF SHIPRA RIVIERA COMPLEX ARE AS UNDER:- (I) BRAHMPUTRA 5.10.1998 (II ) CAVERY 10.10.1998 (III) AMRAVATI 6.10.1998 (IV) DAMODAR 15.10.1998 25. SINCE THE WORK ORDER ITSELF IN CASE OF ALL THE FOUR PROJECTS WERE SUBSEQUENT TO 1.10.1998, THERE IS NO REASON TO ASSU ME THAT COMMENCEMENT OF DEVELOPMENT AND CONSTRUCTION OF HOU SING PROJECT WAS STARTED PRIOR TO 1.10.1998 FOR THE PURPOSE OF D ECLINING THE CLAIM OF DEDUCTION U/S 80IA(4F)/80IB( 10) OF IT ACT. AS P ER EVIDENCE PLACED ON RECORD, CONTRACT FOR CONSTRUCTION OF ALL THE FOUR PROJECTS OF SHIPRA RIVIERA WAS AWARDED ONLY AFTER 30.9.1998. 26. THE ISSUE WITH REGARD TO COMMENCEMENT OF DEVEL OPMENT AND CONSTRUCTION OF HOUSING PROJECT WITH REFERENCE TO S ECTION 80IB(10) HAS BEEN ELABORATELY DEALT WITH BY THE ITAT PUNE BENCH IN THE CASE OF NIRMATI CONSTRUCTIONS VS. DCIT - 95 ITJ 1117 WHEREI N IT WAS HELD THAT ACTIVITIES LIKE APPROVAL OF PLAN, MARKETING FO R BOOKING THE RESIDENTIAL UNITS, AVAILING OF FINANCE, RECEIPTS OF ADVANCE BOOKING 15 MONEY WOULD NOT BE CONSTRUED TO MEAN COMMENCEMENT O F DEVELOPMENT CONSTRUCTION OF HOUSING PROJECTS WAS AL SO HELD THAT MERELY ON THE PLEA THAT ASSESSEE HAS INCURRED EXPEN DITURE ON CLEANING OF LAND AND TOWARDS PUJA PRIOR TO 1.10.1998 WILL NO T TAKE AWAY ASSESSEE'S RIGHT TO CLAIM DEDUCTION U/S 80IB( 10) W HICH HE IS ENTITLED IN RESPECT OF HOUSING PROJECT TO BE COMMENCED AFTER 1.10.1998. IT WAS SPECIFICALLY OBSERVED THAT THESE EXPENSES DO NOT IN DICATE THAT DEVELOPMENT AND CONSTRUCTION OF HOUSING PROJECT HAD BEEN COMMENCED BEFORE1.10.1998. EXPENSES WERE INCURRED O N CLEANING OF LAND SO THAT CORRECT MEASUREMENT OF THE LAND COULD BE DONE. THE ISSUE WITH REGARD TO EXPENDITURE ON LEVELLING OF LAND, AP PROVAL OF PLAN, MARKETING OF BOOKING THE RESIDENTIAL UNITS, RECEIPT OF ADVANCE BOOKING MONEY ETC. HAS ARISEN IN THE INSTANT CASE AND BY TA KING SHELTER OF SOME OF THESE ACTIVITIES HAVING TAKEN PLACE PRIOR TO 1.1 0.1998, THE AO HAS DENIED CLAIM OF DEDUCTION U/S 80IB. RESPECTFULLY FO LLOWING THE DECISION OF THE COORDINATE BENCH, WE DO NOT FIND AN Y MERIT IN THE ACTION OF THE ASSESSING OFFICER. 6. IN THE PRESENT ASSESSMENT YEAR UNDER CONSIDERATI ON AS WELL AS, NO REASON TO ASSUME THAT COMMENCEMENT OF DEVELOPMENT A ND CONSTRUCTION OF THE HOUSING PROJECTS WAS STARTED PRIOR TO 01.10.199 8 FOR THE PURPOSE OF DECLINING THE CLAIM OF DEDUCTION UNDER SEC. 80IA(4F )/80IB(10) OF THE INCOME-TAX ACT, 1961, HAS BEEN SHOWN BY THE REVENUE AND KEEPING IN MIND THE FACT THAT CONTRACT FOR CONSTRUCTION OF ALL THE FOUR PROJECTS OF SHIPRA RIVIERA WAS AWARDED ONLY AFTER 30.9.1998, WE ARE OF THE VIEW THAT THE ISSUE 16 IS FULLY COVERED BY THE ABOVE DECISIONS OF THE ITAT FOR THE ASSESSMENT YEARS 2000-01 AND 2001-02 WHICH HAS ALSO BEEN FOLLOWED BY THE ITAT IN THE CASE OF ASSESSEE ITSELF FOR THE ASSESSMENT YEARS 2004-05 AND 2006-07. RESPECTFULLY FOLLOWING THE SAME, WE UPHOLD THE FIRS T APPELLATE ORDER IN THIS REGARD WITH THIS FINDING THAT THE LEARNED CIT(APPEA LS) WAS JUSTIFIED IN DIRECTING THE ASSESSING OFFICER TO DELETE THE DISAL LOWANCE OF RS.1,19,04,619 WHICH WAS MADE BY THE ASSESSING OFFICER WHILE DENYI NG THE CLAIMED DEDUCTION UNDER SECTION 80-IB OF THE ACT IN RESPECT OF THE ABOVE STATED FOUR PROJECTS. THE RELATED GROUND NOS. 1 TO 3 INVOLVING THE ISSUE ARE THUS REJECTED. 7. IN RESULT, THE APPEAL IS DISMISSED. ITA NO.5588/DEL/2010 : 8. THE ASSESSEE HAS QUESTIONED FIRST APPELLATE ORDE R ON THE FOLLOWING GROUNDS: 1. BECAUSE THE LEARNED CIT(APPEALS) HAS ERRED IN CONFIRMING ADDITION OF RS.232,556 ON ACCOUNT OF CHARITY AND DO NATION WITHOUT ASSIGNING ANY GOOD REASONS. 2. BECAUSE THE LEARNED CIT(APPEALS) HAS ERRED IN CO NFIRMING ADDITION OF RS.100,000 OUT OF VARIOUS EXPENSES CLAI MED ON REPAIR, MAINTENANCE, TRAVELLING, CONVEYANCE, STATIONARY ETC . 17 3. BECAUSE THE LEARNED CIT(APPEALS) HAS ERRED IN CO NFIRMING ADDITION OF RS.10,000 PAID AS COMPOUNDING FEE TO TH E REGISTRAR OF COMPANIES. 4. BECAUSE THE LEARNED CIT(APPEALS) HAS WRONGLY CON FIRMED ADDITION OF RS.1077 ON ACCOUNT OF PPF. 5. BECAUSE THE LEARNED CIT(APPEALS) HAS ERRED IN CO NFIRMING ADDITION OF RS.854,750 AS NON-BUSINESS EXPENSES. 6. BECAUSE THE LEARNED CIT(APPEALS) HAS ERRED IN CO NFIRMING ADDITION OF RS.87,616 ON ACCOUNT OF DEPRECIATION ON CAR. 9. THE LEARNED AR SUBMITTED THAT THE ASSESSEE DOES NOT WISH TO PRESS GROUND NOS. 3 AND 4 HAVING A NOMINAL AMOUNT. THESE GROUNDS ARE ACCORDINGLY REJECTED AS SUCH. 10. REGARDING THE OTHER GROUNDS, QUESTIONING THE AD DITIONS MADE ON ACCOUNT OF CHARITY AND DONATIONS, OUT OF VARIOUS EX PENSES CLAIMED ON REPAIR, MAINTENANCE, TRAVELLING, CONVEYANCE, STATIONERY ETC .; NON-BUSINESS EXPENSES AND ON ACCOUNT OF DEPRECIATION ON CAR, THE LEARNED AR SUBMITTED THAT THESE ARE ALSO COVERED BY THE DECISION OF THE ITAT IN THE ASSESSMENT YEARS 2004- 05 AND 2006-07 - ORDER DATED 03.12.2010 IN THE CASE OF THE ASSESSEE IN ITA NOS.2613/DEL/2010 AND ORS. (SUPRA). 18 11. THE LEARNED SR.DR ON THE OTHER HAND PLACED RELI ANCE ON THE ORDERS OF THE AUTHORITIES BELOW. 12. ON PERUSAL OF ORDERS OF THE AUTHORITIES BELOW, WE FIND THAT THE LEARNED CIT(APPEALS) HAS UPHELD THE ADDITIONS IN QUESTION F OLLOWING THE FIRST APPELLATE ORDER FOR THE ASSESSMENT YEAR 2004-05 IN THE CASE OF THE ASSESSEE ON SIMILAR ISSUES. THE SUBMISSIONS OF THE LEARNED A R BEFORE US IS THAT THE VERY BASIS ON WHICH THE LEARNED CIT(APPEALS) HAS UP HELD THE ADDITIONS AND DISALLOWANCES IN QUESTION WAS ORDER OF HIS PREDECES SOR IN THE ASSESSMENT YEAR 2004-05 WHEREIN THE ITAT HAS TAKEN A DIFFERENT VIEW IN THE APPEAL PREFERRED BY THE ASSESSEE IN THE ASSESSMENT YEAR 20 04-05 AGAINST THE SAID FIRST APPELLATE ORDER. HAVING GONE THROUGH THE ORDE R OF THE ITAT FOR THE ASSESSMENT YEAR 2004-05, WE FIND THAT THE ITAT HAS DELETED THE ADDITIONS/DISALLOWANCES IN QUESTION BY PASSING A DE TAILED ORDER. IN THE ASSESSMENT YEAR 2004-05, THE ITAT HAS HELD THAT THR EE DISALLOWANCES UNDER THE HEAD CHARITY AND DONATIONS, PRIOR PERIOD EXPE NSES AND INTEREST ON TDS (UPTT) TOTAL AMOUNT OF RS.85,419 WAS ADDED BY THE A SSESSEE IN ITS COMPUTATION OF TOTAL INCOME AND HENCE TO THIS EXTEN T, THE DISALLOWANCE MADE BY THE ASSESSING OFFICER IS JUSTIFIED. SINCE THE LE ARNED CIT(APPEALS) HAS SIMPLY UPHELD THE ADDITION ON THE BASIS OF FIRST AP PELLATE ORDER FOR THE ASSESSMENT YEAR 2004-05 WITHOUT DISCUSSING THE RELA TED FACTS ON THE ISSUE FOR 19 THE ASSESSMENT YEAR UNDER CONSIDERATION, WE SET ASI DE THE MATTER TO THE FILE OF THE ASSESSING OFFICER TO DECIDE THE ISSUE AFRESH NO TING DOWN THE FACTS OF THE CASE FOR THE ASSESSMENT YEAR UNDER CONSIDERATION BY PASSING A SPEAKING ORDER. THE GROUND NO.1 IS ACCORDINGLY ALLOWED FOR S TATISTICAL PURPOSES. REGARDING THE ADDITION OF RS.1,00,000 OUT OF VARIOU S EXPENSES CLAIMED ON REPAIR, MAINTENANCE, TRAVELLING, CONVEYANCE, STATIO NERY ETC., WE FIND THAT THE ASSESSING OFFICER HAS MADE THE DISALLOWANCE CONSIDE RING THE ELEMENT OF NON-BUSINESS EXPENDITURE AS WELL AS SELF-MADE VOUCH ERS ON RECORD IN A FEW INSTANCES. THE ITAT IN THE ASSESSMENT YEAR 2004-05 HAS DELETED THIS ADDITION WITH THIS FINDING THAT ON THE BASIS OF GEN ERAL OBSERVATIONS AD HOC DISALLOWANCE CANNOT BE MADE IN ABSENCE OF EVEN A SI NGLE SPECIFIC INSTANCE OF NON-VERIFIABLITY OF THE EXPENSES OR EXPENSES HAVING BEEN INCURRED FOR NON- BUSINESS PURPOSES. FOLLOWING THIS DECISION OF THE I TAT FOR THE ASSESSMENT YEAR 2004-05, WE DIRECT THE ASSESSING OFFICER TO DE LETE THE ADDITION OF RS.1,00,000 IN QUESTION. THE GROUND NO.2 IS ACCORDI NGLY ALLOWED. 13. REGARDING THE ADDITION OF RS.8,54,750 AS NON-BU SINESS EXPENSES QUESTIONED IN GROUND NO.5, THE LEARNED AR SUBMITTED THAT THE AMOUNT IS WRONG AND THE SAME HAS BEEN RECTIFIED BY THE LEARNE D CIT(APPEALS) VIDE ITS ORDER DATED 09.12.2011 UNDER SEC. 154 OF THE ACT SU BSTITUTING THE CORRECT 20 AMOUNT AS RS.2,54,750 AS ADDED BY THE ASSESSING OFF ICER. WE FIND THAT THE ASSESSING OFFICER HAS MADE THE DISALLOWANCE OF RS.2 ,54,750 DEBITED IN P & L ACCOUNT AS MEMBERSHIP FEE ON THE BASIS THAT THE A MOUNT IS NOT EXPENDED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS AND CANNOT BE EVEN EQUATED WITH THE BUSINESS PROMOTION OR SIMILAR SUCH EXPENSES. THE ITAT IN THE ASSESSMENT YEAR 2004-05 HAS DELETED SIMILAR ADD ITION WITH THE FINDING THAT IT WAS FOR THE BUSINESS PURPOSE OF THE ASSESSE E. THE MEMBERSHIP FEE WAS PAID TO NATIONAL REAL ESTATES DEVELOPMENT COUNCIL W HICH WAS ESTABLISHED IN THE YEAR 1998 UNDER THE AEGIS OF UNION MINISTRY OF HOUSING & URBAN POVERTY ALLEVIATION, GOVERNMENT OF INDIA FOR THE DE VELOPMENT AND PROMOTION OF HOUSING AND REAL ESTATES SECTOR IN IND IA. THE ITAT HELD THAT SINCE THE ASSESSEE IS IN THE BUSINESS OF HOUSING DE VELOPMENT AND REAL ESTATES, THIS SUBSCRIPTION IS RELATING TO BUSINESS PURPOSE O F THE ASSESSEE. FOLLOWING THE SAME, WE DIRECT THE ASSESSING OFFICER TO DELETE THE ADDITION. THE GROUND NO. 5 IS ACCORDINGLY ALLOWED. 14. IN GROUND NO.6, ADDITION OF RS.87,616 ON ACCOUN T OF DEPRECIATION ON CAR HAS BEEN QUESTIONED. THE ASSESSING OFFICER HAS MADE THIS DISALLOWANCE AT 10% OF THE CLAIMED DEPRECIATION OF RS.8,76,150 O N CARS ON ACCOUNT OF POSSIBLE PERSONAL USE BY THE DIRECTORS OF THE COMPA NY. THE LEARNED CIT(APPEALS) HAS UPHELD THE SAME ON THE BASIS OF HI S PREDECESSOR ORDER IN 21 THIS REGARD FOR THE ASSESSMENT YEAR 2004-05. THE IT AT IN THE ASSESSMENT YEAR 2004-05 HAS DELETED THE DISALLOWANCE ON THE BA SIS THAT THE DEPRECIATION WAS CLAIMED AS PER THE SCHEDULE ATTACHED WITH THE B ALANCE SHEET AND FOLLOWING THE DECISION OF HON'BLE GUJARAT HIGH COUR T IN THE CASE OF SAYA JI IRON HOLDING THAT EVEN IF THERE IS PERSONAL USE OF CARS BY THE DIRECTORS OF THE ASSESSEE COMPANY, ADDITION CAN BE MADE IN THE HANDS OF THE EMPLOYEES DIRECTORS ON ACCOUNT OF PERQUISITES BUT NO DISALLOW ANCE CAN BE MADE IN THE HANDS OF COMPANY BY ALLEGING THAT THERE IS PERSONAL USE OF CARS. RESPECTFULLY FOLLOWING THIS DECISION, WE DIRECT THE ASSESSING OF FICER TO DELETE THE ADDITION OF RS.87,616. GROUND NO. 6 IS ACCORDINGLY ALLOWED. 15. IN RESULT, THE APPEAL IS PARTLY ALLOWED. 16. IN SUMMARY, APPEAL PREFERRED BY THE REVENUE IS DISMISSED AND THAT PREFERRED BY THE ASSESSEE IS PARTLY ALLOWED. DECISION PRONOUNCED IN THE OPEN COURT ON 19 .03.201 5 SD/- SD/- ( B.C. MEENA ) ( I.C. SUDHIR ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 19 /03/2015 MOHAN LAL 22 COPY FORWARDED TO: 1) APPELLANT 2) RESPONDENT 3) CIT 4) CIT(APPEALS) 5) DR:ITAT ASSISTANT REGISTRAR DATE DRAFT DICTATED ON COMPUTER DIRECTLY 17 & 18.03.2015 DRAFT PLACED BEFORE AUTHOR 18.03.2015 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. APPROVED DRAFT COMES TO THE SR.PS/PS 19.03.2015 KEPT FOR PRONOUNCEMENT ON 19.03.2015 FILE SENT TO THE BENCH CLERK 20.03.2015 DATE ON WHICH FILE GOES TO THE AR DATE ON WHICH FILE GOES TO THE HEAD CLERK. DATE OF DISPATCH OF ORDER.