DCIT, New Delhi V. M/s. Ansal Urban Condominium Pvt. Ltd., New Delhi

ITA 6567/DEL/2015

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6135 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 7 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2012-2013
• Appeal Filed On: 10-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SATYAM SETTI
• Keywords: Depreciation; Revised return
• Section: 139(5)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES E : DELHI BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.S. KAPOOR, ACCOUNTANT MEMBER ITA.NO.6567/DEL./2015 ASSESSMENT YEAR 2012-2013 THE DCIT, CIRCLE-2 (2), ROOM NO.392, C.R. BUILDING, I.P. ESTATE, NEW DELHI 110 002. VS. M/S. ANSAL URBAN CONDOMINIUM PVT. LTD., 115, ANSAL BHAWAN, 16 KASTURBA GANDHI MARG, NEW DELHI 110 001. PAN AAHCA2956R (APPELLANT) (RESPONDENT) FOR REVENUE : MS. RINKU SINGH, SR. D.R. FOR ASSESSEE : SHRI SATYAM SETTI, ADVOCATE. DATE OF HEARING : 05 .0 8 .201 9 DATE OF PRONOUNCEMENT : 07 .0 8 .201 9 ORDER PER BHAVNESH SAINI, J.M. THIS APPEAL BY REVENUE HAS BEEN DIRECTED AGAINST THE ORDER OF THE LD. CIT(A)-1, NEW DELHI, DATED 18.09.2015, FOR THE A.Y. 2012-2013 ON THE FOLLOWING GROUNDS : 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN ALLOWING THE CLAIM OF EXPENSES OF RS.1,00,49,126/- 2 ITA.NO.6567/DEL./2015 M/S. ANSAL URBAN CONDOMINIUM PVT. LTD., NEW DELHI. WITHOUT REVISING THE RETURN U/S 139(5) BY THE ASSESSEE WHICH IS NOT PERMISSIBLE IN VIEW OF THE DECISION OF HON'BLE SUPREME COURT IN THE CASE OF GOETZE INDIA (LTD.). 2. WITHOUT PREJUDICE TO THE ABOVE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN ALLOWING THE ABOVE CLAIM WITHOUT AFFORDING OPPORTUNITY TO THE AO TO VERIFY THE VERACITY OF THE CLAIM. 2. BRIEFLY THE FACTS OF THE CASE ARE THAT ASSESSEE FILED RETURN OF INCOME SHOWING LOSS OF RS.1.05 CRORES. THE ASSESSEE COMPANY WAS INCORPORATED AS A SUBSIDIARY OF ANSAL LANDMARK TOWNSHIP PVT. LTD. (ALTPL), FOR THE PURPOSE OF DEVELOPING A GROUP HOUSING SCHEME IN GHAZIABAD. THE ASSESSEE COMPANY IS DEVELOPING A GROUP HOUSING PROJECT NAMELY ACQUAPOLIS PROJECT AND FOLLOWS PERCENTAGE OF COMPLETION METHOD FOR RECOGNIZING INCOME. AS PER STATEMENT OF PROFIT & LOSS ACCOUNT, THE ASSESSEE HAS SHOWN OTHER INCOME AMOUNTING TO RS.10,14,644/-. AFTER CLAIMING EXPENSES, LOSS OF RS.2,23,05,212/- HAS BEEN SHOWN 3 ITA.NO.6567/DEL./2015 M/S. ANSAL URBAN CONDOMINIUM PVT. LTD., NEW DELHI. IN THE STATEMENT OF PROFIT & LOSS ACCOUNT. IN THE COMPUTATION OF INCOME, THE ASSESSEE HAS ADDED BACK THE STATUTORY DISALLOWANCES AND AFTER CLAIMING DEPRECIATION AS PER INCOME TAX ACT, 1961, NET LOSS OF RS.1,05,72,733/- HAS BEEN RETURNED. DURING THE COURSE OF ASSESSMENT PROCEEDING, THE ASSESSEE VIDE ITS LETTER DATED 12.01.2015 SUBMITTED THAT THE ROC EXPENSES WITH REGARD TO INCREASE IN SHARE CAPITAL HAS BEEN INADVERTENTLY ADDED BACK TO THE TUNE OF RS.1,17,67,986/- WHEREAS THE ACTUAL AMOUNT OF THE EXPENDITURE IS ONLY RS.17,18,860/-. THE A.O. HOWEVER DO NOT ACCEPT THE CLAIM OF ASSESSEE BECAUSE NO REVISED RETURN HAVE BEEN FILED UNDER SECTION 139(5) OF THE I.T. ACT. THE A.O. RELIED UPON JUDGMENT OF THE HONBLE SUPREME COURT IN THE CASE OF GOETZE INDIA LTD., VS. CIT [2006] 157 TAXMAN 1 (SC) AND DISALLOWED THE CLAIM OF ASSESSEE. 3. THE ASSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE A.O. AND PRODUCED THE DOCUMENTARY EVIDENCES ON RECORD THAT THERE WAS A MISTAKE IN MAKING CLAIM BEFORE A.O. HE HAS SUBMITTED THAT A.O. SHALL HAVE TO ASSESS THE ASSESSEE ON CORRECT TAX LIABILITY AS PER LAW AND VARIOUS 4 ITA.NO.6567/DEL./2015 M/S. ANSAL URBAN CONDOMINIUM PVT. LTD., NEW DELHI. DECISIONS HAVE BEEN RELIED UPON. THE LD. CIT(A) EXAMINED THE ISSUE AND NOTED THAT DURING ASSESSMENT PROCEEDINGS ASSESSEE FILED REVISED COMPUTATION OF INCOME BEFORE A.O. WHEREBY IT HAS CLAIMED THAT EXPENSES OF RS.1,00,49,126/- WERE WRONGLY ADDED BACK IN THE COMPUTATION OF INCOME ALONG WITH EXPENSES OF RS.17,18,860/- PERTAINING TO THE AMOUNT PAID FOR INCREASE IN AUTHORISED SHARE CAPITAL. THE ASSESSEE SUBMITTED THAT ONLY AN AMOUNT OF RS.17,18,860/- PERTAIN TO INCREASE IN AUTHORISED SHARE CAPITAL AND THE REMAINING EXPENDITURE OF RS.1,00,49,126/- COMPRISE OF PLAN SANCTION FEE, DEVELOPMENT FEE, ENVIRONMENT AND POLLUTION FEE ETC., THE ASSESSEE MADE SUCH A CLAIM BEFORE A.O. TO HIGHLIGHT THAT IT IS A MISTAKE IN MAKING THE CLAIM. THE ASSESSEE RELIED UPON JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. JAI PARABOLIC SPRINGS LTD., 306 ITR 42 (DEL.) IN WHICH IT WAS HELD THAT CIT(A) HAD THE JURISDICTION TO ENTERTAIN THE ADDITIONAL CLAIM NOT FILED BEFORE A.O. AND OTHER DECISIONS OF DIFFERENT HIGH COURTS WERE ALSO REFERRED TO. THE LD. CIT(A), THEREFORE, NOTED THAT CASE OF THE ASSESSEE IS COVERED BY THESE JUDGMENTS, THEREFORE, CLAIM OF EXPENSES 5 ITA.NO.6567/DEL./2015 M/S. ANSAL URBAN CONDOMINIUM PVT. LTD., NEW DELHI. OF RS.1,00,49,126/- IS FULLY ALLOWABLE. THE CLAIM OF ASSESSEE WAS ACCORDINGLY ALLOWED. 4. AFTER CONSIDERING THE RIVAL SUBMISSIONS, WE ARE OF THE VIEW THAT NO INTERFERENCE IS CALLED FOR IN THE MATTER. THE LD. D.R. RELIED UPON ORDER OF THE A.O. AND SUBMITTED THAT SINCE NO REVISED RETURN WAS FILED BEFORE A.O, THEREFORE, CLAIM OF EXCLUDING EXPENSES SHOULD NOT HAVE BEEN ALLOWED. 5. ON THE OTHER HAND, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT APPELLATE AUTHORITY HAVE POWER TO ENTERTAIN THE CLAIM WHICH IS NOT MADE BEFORE A.O. 6. IN THE PRESENT CASE, THE A.O. DID NOT DISPUTE ON MERIT THAT CLAIM OF ASSESSEE IS JUSTIFIED. SINCE IT IS A MISTAKE ON RECORD, THEREFORE, THE LD. CIT(A) BEING FIRST APPELLATE AUTHORITY HAS CORRECTLY ENTERTAINED THE CLAIM OF ASSESSEE. THE REVENUE HAS NOT FILED ANY APPEAL ON MERIT TO CHALLENGE THE ORDER OF LD. CIT(A) THAT ASSESSEE IS NOT ENTITLED TO CLAIM ON MERITS. THE ISSUE IS, THEREFORE, COVERED BY THE JUDGMENT OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. JAI 6 ITA.NO.6567/DEL./2015 M/S. ANSAL URBAN CONDOMINIUM PVT. LTD., NEW DELHI. PARABOLIC SPRINGS LTD., (SUPRA) IN WHICH IT WAS HELD AS UNDER : HELD, DISMISSING THE APPEAL, THAT THERE WAS NO PROHIBITION ON THE POWERS OF THE TRIBUNAL TO ENTERTAIN AN ADDITIONAL GROUND WHICH ACCORDING TO THE TRIBUNAL AROSE IN THE MATTER AND FOR THE JUST DECISION OF THE CASE. THERE WAS NO INFIRMITY IN THE ORDER OF THE TRIBUNAL. 6.1. IN VIEW OF THE ABOVE, NO INFIRMITY HAVE BEEN POINTED OUT IN THE ORDER OF THE LD. CIT(A). DEPARTMENTAL APPEAL FAILS AND IS DISMISSED. 7. IN THE RESULT, APPEAL OF DEPARTMENT DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT. SD/- SD/- (T.S. KAPOOR) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DELHI, DATED 07 TH AUGUST, 2019 VBP/- COPY TO 1. THE APP ELLANT 2. THE RESPONDENT 3. CIT(A) CONCERNED 4. CIT CONCERNED 5. D.R. ITAT E BENCH, DELHI 6. GUARD FILE. 7 ITA.NO.6567/DEL./2015 M/S. ANSAL URBAN CONDOMINIUM PVT. LTD., NEW DELHI. // BY ORDER // ASSISTANT REGISTRAR : ITAT DELHI BENCHES : DELHI.