Sharada Construction & Investment Company, Pune V. Addl CIT Rg 3 Pune., Pune

ITA 720/PUN/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 66870 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2008-2009
• Appeal Filed On: 10-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S PRAVEENA
• Assessee Lawyers: NIKHIL PATHAK SHRI SUHAS BORA
• Keywords: Depreciation; Question of law
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI G.S.PANNU, ACCOUNTANT MEMBER, AND SHRI R.S.PADVEKAR, JUDICIAL MEMBER. ITA.NO.720/PN/2012 (ASSTT. YEAR : 2008-09) M/S.SHARADA CONSTRUCTION & INVESTMENT CO., SHARADA CENTRE, 11/1, ERANDWANE, PUNE 411004. .. APPELLANT PAN: AADFS6325H VS. ADDL.CIT, RANGE-3, PUNE. .. RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK/ SHRI SUHAS BORA DEPARTMENT BY : SMT.S.PRAVEENA DATE OF HEARING : 24.04.2013 DATE OF PRONOUNCEMENT : 29.04.2013 ORDER PER R.S.PADVEKAR, JM : IN THIS APPEAL THE ASSESSEE HAS CHALLENGED THE IMP UGNED ORDER OF THE LD. CIT(A)-II, PUNE, DATED 23.12.2011 FOR TH E A.Y. 2008-09. THE ASSESSEE HAS TAKEN THE FOLLOWING EFFECTIVE GROU NDS: 1. GROUND NO.1 DISALLOWANCE OF DEDUCTION U/S.80IA : RS.15,52,899/- A) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW THE LD. CIT(A) ERRED IN CONFIRMING THE DISALLOWANCE OF CLAIM OF RS.15,52,899/- MADE U/S.80IA BY HOLDING THAT REGARD LESS OF THE EXERCISE OF OPTION BY ASSESSEE OF CHOOSING THE INITIAL ASSESSMENT YEAR, THE UNABSORBED LOSSES/DEPRECIATION RELATING TO ELIGIBLE UNDERTAKING ARE TO BE TAKEN IN TO ACCOUNT IN DETERMINING THE QUANTUM OF DEDUCTION U/S.80IA EV EN THOUGH THESE MAY HAVE BEEN ACTUALLY SET OFF AGAINST THE PROFITS OF THE ASSESSEE FROM OTHER SOURCES. B) YOUR APPELLANT SUBMITS THAT THE LD. CIT(A) OUGHT TO HAVE HELD THAT W.E.F. 1-4-2000, SEC.80IA(5) IS APPLICABL E ONLY 2 WHEN THE ASSESSEE CHOOSES TO CLAIM DEDUCTION U/S 80 IA FOR THE FIRST TIME BY EXERCISING OPTION AVAILABLE U/S.8 0IA(2) AS THIS WILL BE THE YEAR IN WHICH THE UNDERTAKING HAS TO BE TREATED AS A SEPARATE SOLE SOURCE OF INCOME WITHIN THE MEANING OF SECTION 80IA(5) AND THEREFORE DEPRECIATI ON AND LOSS OF EARLIER YEAR CANNOT BE NOTIONALLY CARRIED F ORWARD TO BE SET OFF AGAINST INCOME OF THAT YEAR FOR COMPUTIN G DEDUCTION U/S 80IA. C) YOUR APPELLANT PRAYS THAT DEDUCTION AS CLAIMED BY T HE ASSESSEE MAY KINDLY BE ALLOWED. 2. GROUND NO.2 TREATING INCOME RECEIVED FROM RENTING OF TERRACE OF BUILDING AS INCOME UNDER THE HEAD INCOME FROM OTHER SOURCES A) ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW THE LD. CIT(A) ERRED IN CONFIRMING THE TREATMENT OF INC OME RECEIVED FROM RENTING OF TERRACE OF BUILDING AS FAL LING UNDER THE HEAD INCOME FROM OTHER SOURCES AS AGAINST THE CLAIM OF THE ASSESSEE THAT IT FALLS UNDER THE HEAD INCOM E FROM HOUSE PROPERTY. B) YOUR APPELLANT PRAYS THAT THE CLAIM OF THE ASSESSEE THAT THE INCOME FALLS UNDER THE HEAD INCOME FROM HOUSE PROP ERTY BE UPHELD. 2. THE FACTS WHICH ARE REVEALED FROM THE RECORD ARE AS UNDER. THE ASSESSEE IS CARRYING OUT BUSINESS ACTIVITY AS P ROMOTERS AND DEVELOPERS AND ALSO IS ENGAGED IN THE WIND POWER GE NERATION. ASSESSEE FILED THE RETURN OF INCOME FOR THE A.Y. 20 08-09 DECLARING TOTAL INCOME AT RS.2,36,45,840/-. THE ASSESSEES C ASE WAS SELECTED FOR SCRUTINY AND ASSESSMENT HAS BEEN COMPLETED U/S. 143(3) OF THE ACT. THE ASSESSING OFFICER MADE THE DISALLOWANCE I N RESPECT OF DEDUCTION CLAIMED U/S.80IA(4) OF THE ACT TO THE EXT ENT OF RS.15,52,899/- WHICH WAS CLAIMED ON ACCOUNT OF POWE R GENERATION FROM THE WINDMILL. THE ASSESSING OFFICER ALSO TREA TED THE RENT/INCOME RECEIVED BY THE ASSESSEE FOR THE USE OF THE TERRACE TO THE EXTENT OF RS.7,20,000/- AS INCOME FROM OTHER SO URCES, REJECTING THE CLAIM OF THE ASSESSEE THAT THE SAID INCOME IS T O BE ASSESSED UNDER THE HEAD INCOME FROM HOUSE PROPERTY. ASSE SSEE CHALLENGED BOTH THE DISALLOWANCES BEFORE THE LD. CIT(A) BY FIL ING THE APPEAL. THE LD. CIT(A) HAS NOTED THAT THE FIRST NOTICE OF H EARING WAS SENT TO THE ASSESSEE BY RPAD ON 27.07.2011 FIXING THE CASE FOR HEARING ON 18.08.2011, BUT THERE WAS NO RESPONSE FROM THE ASSE SSEE TO THE 3 SAID NOTICE. ANOTHER NOTICE WAS ISSUED ON 05.10.20 11 FIXING THE HEARING OF THE APPEAL ON 28.10.2011, BUT ON THE APP OINTED DAY NONE ATTENDED. AGAIN ANOTHER NOTICE WAS SENT TO TH E ASSESSEE ON 08.11.2011. THE LD. CIT(A) HAS OBSERVED THAT THE A SSESSEE RECEIVED ALL THE NOTICES SENT BY RPAD. THE LD. CIT(A), THER EFORE, ISSUED THE FINAL NOTICE REQUIRING THE ASSESSEE TO ATTEND ON 19 .12.2011. AS NOTED BY THE LD. CIT(A), EVEN THE ASSESSEE DID NOT RESPOND TO THAT NOTICE. THE LD. CIT(A), THEREFORE, PROCEEDED TO DI SPOSE OF THE APPEAL EX PARTE. 3. WE HAVE HEARD THE PARTIES AND PERUSED THE RECORD . IN THIS CASE IT IS NOT DISPUTED THAT THE LD. CIT(A) HAS SEN T 3-4 NOTICES TO THE ASSESSEE AS NOTED IN THE IMPUGNED ORDER. THE L D. COUNSEL SUBMITS THAT IN THE INTEREST OF JUSTICE ONE MORE OP PORTUNITY MAY BE GIVEN TO THE ASSESSEE AS ASSESSEE WAS HAVING SOME G ENUINE DIFFICULTIES FOR NOT ATTENDING BEFORE THE LD. CIT(A ). AS PER THE NOTINGS MADE BY THE LD. CIT(A) IN THE ORDER, THOUGH IN OUR OPINION ASSESSEE DOES NOT DESERVE TO BE GIVEN ANY MORE OPPO RTUNITY, BUT CONSIDERING THE FACT THAT THE TRIBUNAL IS THE LAST FACT FINDING AUTHORITY AS WELL AS ON THE QUESTION OF LAW, HENCE IN THE INTEREST OF JUSTICE WE GIVE ONE MORE OPPORTUNITY TO THE ASSESSE E TO PRESENT BEFORE THE LD. CIT(A) AND REPRESENT ITS CASE. WE A CCORDINGLY SET ASIDE THE ORDER OF THE CIT(A) ON THE ISSUES RAISED BEFORE US AND DIRECT LD. CIT(A) TO DISPOSE OF THE APPEAL BY GIVIN G OPPORTUNITY TO THE ASSESSEE BY PROPER SERVICE OF NOTICE BY RPAD. ASSESSEE IS ALSO DIRECTED TO COOPERATE FOR THE DISPOSAL OF THE APPEA L. 4. IN THE RESULT, ASSESSEES APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN COURT ON THIS THE 29 TH DAY OF APRIL, 2013. SD/- SD/- ( G.S.PANNU ) ( R.S.PADVEKAR ) ACCOUNTANT MEMBER JUDICIAL MEMBER GSPS PUNE, DATED THE 29 TH APRIL, 2013 4 COPY OF THE ORDER IS FORWARDED TO: 1. THE ASSESSEE 2. THE ADDL.CIT, RANGE-3, PUNE. 3. THE CIT(A)-II, PUNE. 4. THE CIT-II, PUNE. 5. THE DR B BENCH, PUNE. 6. GUARD FILE. BY ORDER //TRUE COPY// PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, PUNE.