Deputy Commissioner of Income-Tax, Central Circle 2(1), Pune V. M/s. Vikram Developers And Promotors, Pune

ITA 608/PUN/2020

AI Insights

The case involves an appeal by the Deputy Commissioner of Income Tax, Central Circle-2(1), Pune against M/s. Vikram Developers and Promoters concerning the applicability of Section 115JC of the Income Tax Act, 1961 for the assessment year 2014-15. The primary legal contention was whether the amended provisions of Section 115JC, which pertain to the Alternate Minimum Tax (AMT), apply to the assessee despite the approval of their project 'Midori' before the specified date. The CIT(A) had previously ruled in favor of the assessee, which was contested by the Revenue in this appeal. The Tribunal's decision was influenced by a precedent set in a similar case, ITA.No.159/PUN./2018 & C.O.No.1/PUN./2022, which supported the Revenue's position.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 137364 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 1 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2023
• Appeal Filed By: Department
• Order Result: AllowedAllowed
• Bench Allotted: B
• Next Hearing Date: 20-12-2022
• Assessment Year: 2014-2015
• Appeal Filed On: 11-11-2020
• Other Referred Cases: ITO vs. M/s. Yash Associates, M/s.Vikram Developers and Promoters Vs. DCIT, Central Bank of India Vs. State of Kerala, CIT Vs. Calcutta Knitwears, Ludhiana, CCE Vs. Dilip Kumar, PCIT Vs. Wipro Ltd., M/s.Sankara Polymers (P) Ltd. Vs. ITO
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Section: 115JB; 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH “B” : PUNE BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER ITA.No.608/PUN./2020 Assessment Year 2014-15 The DCIT, Central Circle-2(1) Room No.630, 6 th Floor, 548/2B, Gultekadi, Salisbury Park, Pune. Maharashtra. PIN – 411 037. vs. M/s. Vikram Developers and Promoters, 19, Shrikrishna Heights, Ganeshkhind Road, Shivaji Nagar, Pune. PAN AAGFV4298R PIN – 411 005 (Appellant) (Respondent) For Revenue : Shri M.G. Jasnani For Assessee : Shri Kishor Phadkhe Date of Hearing : 21.12.2022 Date of Pronouncement : 10.01.2023 ORDER PER SATBEER SINGH GODARA, J.M. This assessee’s appeal for the assessment year 2014- 15, arises against the CIT(A), Pune-12, Pune’s order dated 22.09.2020, passed in DIN & Order No.ITBA/APL/S/250/ 2020-21/1028031053(1), involving proceedings under Section 143(3) of the Income Tax Act, 1961 (in short “the Act”). 2. Heard both the parties. Case file perused. 3. The Revenue raises the following substantive grounds in the instant appeal : 2 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 1. “Whether in the facts and circumstances of the case and in law, the Ld.CIT(A) was justified in holding that amended provisions of section 115JC of the Income tax Act do not apply to the assessee, as the approval of the said project "Midori" has been obtained prior to 01/04/2013 ? 2. Whether m the facts and circumstances of the case and in law, the Ld. CIT(A) was justified by not applying the provisions of section 115JC to the assessee though that the amended provisions clearly provide for application of the section to any assessee , not being a company, whose total Income tax payable is less than the AMT (Alternate Minimum Tax ? 3. The appellant craves leave to add, amend or alter any ground/ grounds of appeal which may be necessary.” 4. Both the learned representatives next took us to the CIT(A)'s detailed discussion rejecting applicability of sec.115JC “AMT” provision as follows : 3 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 4 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 5 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 6 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 7 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 8 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 9 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 10 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 11 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 12 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 13 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 14 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 15 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 16 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 17 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 18 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 19 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 20 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. 5. Mr. Fadke vehemently argued in assessee’s favour that it has already succeeded on the very issue in earlier assessment year before this tribunal. 6. The Revenue on the other hand has strong support from the Assessing Officer’s action making the impugned sec.115JC adjustment in issue. 7. Faced with the situation, we note that this tribunal’s recent coordinate bench’s order in ITA.No.159/ PUN./2018 & C.O.No.1/PUN./2022 decided on 05.08.2022 in ITO vs. M/s. Yash Associates goes against the assessee and in department’s favour as follows : “4. Next comes the assessee’s C.O.No.01/PUN/2022 raising its sole substantive grievance that section 115JC of the Act is not applicable in its case as the corresponding residential project(s) had been approved and completed well before the Finance Act, 2011 inserting the foregoing provision made applicable w.e.f 01.04.2012. Learned Counsel also sought to buttress the point that such a course of action of making section 115JC applicable in case of residential projects having got approved / completed much earlier would render sec 80IC(10) deduction as well as sec 115JC(1) as otiose. It was further highlighted that this eligible assessee had only developed a single residential project which stood completed and therefore, building / development business 21 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. had come to an end. Meaning thereby that it would not be able to raise any tax credit claim u/s.115JC(1) in the succeeding assessment years. Mr.Thakkar also quoted this tribunal’s co- ordinate bench’s order in M/s.Vikram Developers and Promoters Vs. DCIT ITA Nos.2795 & 2796 /PUN/2016 dated 14.11.2019 rejecting applicability of section 115JC “AMT” qua the projects which had already sanctioned and completed before 01/04/2012. 5. We find no merit in the assessee’s instant arguments. We make it clear that the legislature has inserted Chapter XII-BA in the Act; including sec 115JC, by the Finance Act, 2011 w.e.f 01.04.2012 applicable in case of “persons other than a company”. Section 115JC (1) starts with a non-obstante clause “Notwithstanding anything contained in this Act” in the nature of an overriding provision on all other provisions of the Act” which is in light of Central Bank of India Vs. State of Kerala [2009] 45 CC 94 (SC). It is further noted that section 115JC(2)(i) stipulates adjustment(s) in an assessee’s total income; “as increased by deductions claimed, if any, under any section (other than section 80B) included in Chapter-VIA under the heading {C}-Deduction in respect of certain incomes”. There is hardly any dispute that the assessee’s impugned section80IB(10) deduction indeed comes under this specific clause wherein the legislature has not stipulated any exception regarding the eligible residential 22 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. projects which had been approved or completed earlier or later; as the case may be. The same rather indicates very clearly that it is not the approval or completion of the residential project but the deduction claim only which has to be added u/s.115JC(2)(i) of the Act. 6. Faced with the situation, we adopt stricter interpretation in light of the foregoing non-obstante provision and reject the assessee’s contentions as per of hon’ble apex court’s recent decision in CIT Vs. Calcutta Knitwears, Ludhiana [2014] 6 SCC 444 (SC), CCE Vs. Dilip Kumar [2018] 9 SCC 1 (SC) (FB) and PCIT Vs. Wipro Ltd. [2022] 140 taxmann.com 223 (SC). 7. Learned counsel at this stage once again reiterated his vehement contentions in light of section 115JC read with sec 115JD(1) of the Act(supra). He could hardly rebut the fact that section 115JC(1) carries an overriding effect on section 115JD being in the nature of non-obstante provision. He next sought constitution of a Special Bench u/s 255(3) of the Act once we are taking a divergent view going against M/s.Vikram Developers and Promoter Ltd., (supra). And that making sec 115JC applicable on already approved / completed housing projects eligible for sec 80IB(10) deductions would end up frustrating the deduction provision itself. All these assessee’s argument fail to evoke our concurrence. So far as it’s reliance on learned co- 23 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. ordinate bench in concerned, we hold that the same hardly forms a binding precedent as per CIT Vs. B R Constructions [1993] 202 ITR 333 (AP)(FB) holding that any decision not based on correct appreciation of facts and law does not bind a co-ordinate bench. The assessee’s last argument in that sec 115 JC; if made applicable on its project entitled for sec 80IB(10) deduction which had been approved & completed much earlier, hardly carried any weight in light of M/s.Sankara Polymers (P) Ltd. Vs. ITO [2013] 31 taxmann.com 1656 (Kar) rejecting the concerned assessee’s contention challenging sec 115JB “MAT” applicability on its income eligible for sec 80IB deduction. The very principle applies in section 115JC as well since the difference vis-a-vis sec 115JB is regarding the class of an assessee i.e. “PERSONS OTHER THAN A COMPANY and “Companies” only. The assessee fails in all of its argument, grounds raised in CO No.01/PUN/2022. Ordered Accordingly.” 8. Learned counsel at this stage made a strong endeavour to either seek constitution of a Special Bench or to follow the assessee’s earlier order, as the case may be. 9. We find from the perusal of the learned coordinate bench’s order in earlier assessment year that it had nowhere examined the ambit and scope of AMT provision in sec.115JC of the Act so as to form a binding precedent in line of CIT vs. 24 ITA.No.608/PUN./2020 M/s. Vikram Developers And Promoters, Pune. B.R. Constructions [1993] 202 ITR 222 [A.P.]. We thus adopt stricter interpretation herein as well to accept the Revenue’s instant sole substantive ground seeking to revoke sec.115JC of the Act in assessee’s case. Ordered accordingly. 10. This Revenue’s appeal is allowed in above terms. Order pronounced in the open Court on 10.01.2023. Sd/- Sd/- [DR. DIPAK P. RIPOTE] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 10 th January, 2023 VBP/- Copy to 1. The appellant 2. The respondent 3. The Ld. CIT(A) concerned. 4. The CIT concerned 5. D.R. ITAT, Pune “B” Bench, Pune 6. Guard File. //By Order// Assistant Registrar, ITAT, Pune Benches Pune.