M/s Sunderam Builders And Developmers, Indore V. The CIT- I, Indore

ITA 55/IND/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 54048 (ITAT-INDORE)
• Duration Of Justice: 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: misc
• Appeal Filed On: 30-05-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KESHAV SAXENA
• Assessee Lawyers: H P VERMA
• Keywords: Opportunity of being heard
• Section: 143(3); 6; 263

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JUDICIAL MEMBER AND SHRI R.C. SHARMA, ACCOUNTANT MEMBER ITA NO.55 TO 57/IND/2011 A.YS. 2005-06 TO 2007-08 SUNDERAM BUILDERS AND DEVELOPERS, INDORE PAN AAYFS 2386 P ... APPELLANT VS CIT-I, INDORE ... RESPONDENT DATE OF HEARING 24.11.2011 DATE OF PRONOUNCEMENT 30.11.2011 APPELLANT BY : S/SHRI HP VERMA AND ASHISH GOYAL RESPONDENT BY: SHRI KESHAV SAXENA, CIT DR O R D E R PER JOGINDER SINGH THESE THREE APPEALS ARE BY THE ASSESSEE FOR THE ASSESSMENT YEARS 2005-06 TO 2007-08 CHALLENGING THE DIFFERENT ORDERS OF THE LEARNED COMMISSIONER DATED 31.3.2011 ON THE GROUND THAT THE LEARNED COMMISSIONER ERRED IN INVOK ING 2 REVISIONAL JURISDICTION U/S 263 OF THE ACT ESPECIAL LY WHEN THE ASSESSING OFFICER FRAMED THE ASSESSMENT U/S 143(3) OF THE ACT READ WITH SECTION 153A/C OF THE ACT AND FURTHER IN SETTING ASIDE THE ORDER FOR DE NOVO CONSIDERATION ON THE PLEA THA T THE CLAIMED DEDUCTION U/S 80IB(10) REQUIRES FRESH CONSIDERATION AS THE ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. 2. DURING HEARING, THE LEARNED COUNSEL FOR THE ASSE SSEE, SHRI H.P. VERMA, ADVANCED THE ARGUMENTS WHICH ARE I DENTICAL TO THE GROUND RAISED BY FURTHER SUBMITTING THAT THE REVISIONAL JURISDICTION WAS INVOKED BY THE LEARNED CIT ON TWO COUNTS, NAMELY, (I) THE ASSESSEE IS A CONTRACTOR AND (II) T HERE IS NO CERTIFICATE OF COMPLETION OF PROJECT. IT WAS SUBMI TTED BY THE LEARNED COUNSEL FOR THE ASSESSEE THAT THE ASSESSEE IS A DEVELOPER AS THE DEVELOPMENT WAS DONE BY THE ASSESS EE FROM INITIAL STAGE TILL THE CONSTRUCTION OF THE HOUSES. OUR ATTENTION WAS INVITED TO PAGES 166 TO 173 OF THE PAPER BOOK C ONTAINING DEVELOPMENT AGREEMENT ALONG WITH PAGES 168, 175, 16 9 TO 171, 186, 190 TO 192 AND LAST PARA OF THE IMPUGNED ORDER. A STRONG PLEA WAS RAISED BY THE LEARNED COUNSEL FOR T HE ASSESSEE 3 THAT REVISIONAL JURISDICTION CAN BE INVOKED ONLY WH EN THE ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE AND SINCE THE ASSESSMENT WAS FRAMED ON EXAMINATION OF V ARIOUS DETAILS FILED BY THE ASSESSEE AND ONE OF THE POSSIB LE VIEWS WAS TAKEN BY THE ASSESSING OFFICER, THEREFORE, THE ASSE SSMENT ORDER IS NEITHER ERRONEOUS NOR PREJUDICIAL TO THE I NTEREST OF THE REVENUE. 3. ON THE OTHER HAND, THE LEARNED CIT DR STRONGLY DEFENDED THE INVOCATION OF REVISIONAL JURISDICTION BY THE LE ARNED CIT BY SUBMITTING THAT EVEN THE COMPLETION CERTIFICATE WAS NOT PRODUCED BY THE ASSESSEE BEFORE THE ASSESSING OFFIC ER AND AS SUCH IN THE ABSENCE OF THE SAME, THE ASSESSING OFFI CER WAS NOT JUSTIFIED IN GRANTING DEDUCTION U/S 80IB(10) OF THE ACT. MR. SAXENA FURTHER CONTENDED THAT THE ASSESSMENT ORDER IS CLEARLY ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE RE VENUE AND EVEN THE BASIC FACTS HAVE NOT BEEN DISCUSSED IN THE ASSESSMENT ORDER. OUR ATTENTION WAS ALSO INVITED T O THE LANGUAGE AND REQUIREMENT OF SECTION 80-IB(10) OF TH E ACT. 4 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON FILE. IT IS AN A DMITTED POSITION THAT BEFORE THE LEARNED COMMISSIONER INVOKES THE RE VISIONAL JURISDICTION U/S 263 OF THE ACT, HE MUST BE SATISFI ED THAT THE ORDER IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. IF THE FACTS AND THE ASSERTION MADE BY THE LEARNED RESPECTIVE COUNSELS ARE ANALYSED, WE FIND THAT MAHASHAKTI GRAH NIRMAN SAHKARI SANSTHA MARYADIT (HEREINAFTER CALLED THE S OCIETY) OWNED 4.24 HECTARES OF LAND FOR WHICH THE ASSESSEE WAS ENTRUSTED THE TASK OF DEVELOPMENT VIDE DEVELOPMENT AGREEMENT (PAGES 166 TO 172) OF THE PAPER BOOK AS P ER WHICH THE ASSESSEE WAS AUTHORISED TO DEVELOP THE LAND OWN ED BY THE SOCIETY ON THE TERMS AND CONDITIONS CONTAINED THERE IN. THE SOCIETY HAD ALREADY OBTAINED APPROVAL FROM THE TOWN AND COUNTRY PLANNING DEPARTMENT AND WAS TO GET THE PERM ISSION FROM MUNICIPAL CORPORATION. THE MUNICIPAL CORPORAT ION ACCORDED CONDITIONAL PERMISSION TO THE ASSESSEE AS IS EVIDENT FROM LETTER DATED 20.6.2003 (PAGE 174 OF THE PAPER BOOK). ONE OF THE REASONS FOR INVOKING THE REVISIONAL JURISDIC TION BY THE 5 LEARNED COMMISSIONER IS THAT THE ASSESSEE IS MERELY A CONTRACTOR AND NOT A DEVELOPER AND NO COMPLETION CE RTIFICATE WAS OBTAINED AS REQUIRED UNDER THE PROVISIONS OF TH E ACT. IF THIS OBSERVATION OF THE LEARNED CIT IS ANALYSED WIT H THE FACTS OF THE PRESENT APPEALS, WE ARE IN AGREEMENT THAT THE A SSESSMENT WAS FRAMED BY THE ASSESSING OFFICER WITHOUT COMPLYI NG WITH THE REQUISITE CONDITIONS CONTAINED IN THE PROVISIONS OF THE ACT. IN THE ASSESSMENT ORDER IT HAS BEEN MERELY MENTIONED T HAT BOOKS OF ACCOUNT WERE PRODUCED AND THE SAME WERE VERIFIED AND TEST CHECKED WHEREAS THE LEARNED ASSESSING OFFICER HAS N OT GIVEN HIS FINDING REGARDING FULFILMENT OF CONDITIONS CON TAINED U/S 80IB(10) OF THE ACT WHICH CLEARLY SHOWS THAT THE CL AIMED DEDUCTION HAS BEEN ALLOWED BY THE ASSESSING OFFICER WITHOUT APPLICATION OF MIND. THE LEARNED COMMISSIONER INVOK ED THE REVISIONAL JURISDICTION AFTER BEING FULLY SATISFIED ABOUT THE TWIN CONDITIONS AS REQUIRED U/S 263 OF THE ACT. THE EXPR ESSION PREJUDICIAL TO THE INTEREST OF THE REVENUE MUST B E REGARDED AS INVOLVING CONCEPTION OF FACTS OF ORDERS WHICH ARE S UBVERSIVE OF THE ADMINISTRATION OF REVENUE. THE SCOPE OF INTERFE RENCE U/S 6 263 IS NOT TO SET ASIDE MERELY UNFAVOURABLE ORDERS AND TO BRING TO TAX SOME MORE MONEY INTO THE TREASURY NOR THIS S ECTION IS MEANT TO GET THE SHEER ESCAPEMENT OF REVENUE BUT TH E PREJUDICE MUST BE PREJUDICE TO THE INTEREST OF REVE NUE. IT SEEMS THAT THE ASSESSMENT HAS BEEN FRAMED IN UNDUE HASTE AND WITHOUT MAKING PROPER INQUIRY. THE INQUIRY INTO THE ELIGIBILITY OF CLAIMED DEDUCTION IS ALSO NECESSARY AND THAT SHOULD BE PEN DOWN IN THE ORDER. ALLOWING CERTAIN DEDUCTIONS WIT HOUT PROVING THE CLAIM OR WITHOUT PROPER VERIFICATION OR IN IGNO RANCE OF THE PROVISIONS OF LAW ARE ALSO THE INSTANCES WHERE THE ORDER COULD BE CONSIDERED PREJUDICIAL TO THE INTEREST OF THE RE VENUE AND COULD BE SET RIGHT FOR REVISIONAL JURISDICTION. IT IS FURTHER SEEN THAT THE LEARNED COMMISSIONER HAS REMANDED THE MATT ER BACK TO THE ASSESSING OFFICER FOR DE NOVO CONSIDERATION, MEANING THEREBY, THE ASSESSING OFFICER SHALL FRAME THE ASSE SSMENT AFTER GIVING THE ASSESSEE AN OPPORTUNITY OF BEING HEARD A ND CONSIDERING THE MATERIAL ALREADY AVAILABLE ON RECOR D BEFORE HIM. AS SUCH, THE INTEREST OF THE ASSESSEE SHALL ALSO ST AND SAFEGUARDED. AT THE SAME TIME, THE INTEREST OF REV ENUE HAS 7 BEEN SAFEGUARDED WITHOUT PREJUDICE TO THE ASSESSEE. IF THE TOTALITY OF FACTS IS ANALYSED, WE FIND THAT THE ASS ESSMENT ORDER BEING NON-SPEAKING ON THE ISSUE, THEREFORE, IS ERRO NEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. WE, THE REFORE, FIND NO INFIRMITY IN INVOKING THE REVISIONAL JURISDICTION B Y THE LEARNED COMMISSIONER AND AFFIRM THE SAME. FINALLY, THE APPEALS OF THE ASSESSEE ARE DISMISSED . ORDER WAS PRONOUNCED IN THE OPEN COURT ON 30 .11. 2011. SD SD (R.C.SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 30 .11.2011 COPY TO: APPELLANT, RESPONDENT, CIT, CIT(A), DR, GU ARD FILE DN/-