ACIT, Panchkula V. M/s Housing Board Haryana, Panchkula

ITA 764/CHANDI/2015

• Counselvise Citation: [2016] 121 COUNSELVISE.COM (IT) 2467 (ITAT-CHANDIGARH)
• Duration Of Justice: 3 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: Not Allotted
• Next Hearing Date: 05-01-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 08-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: B K NOHRIA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND MS. RANO JAIN, ACCOUNTANT MEMBER ITA NO.764/CHD/2015 (ASSESSMENT YEAR : 2009-10) THE D.C.I.T., VS. M/S HOUSING BOARD HARYANA, PANCHKULA CIRCLE, C-15, SECTOR 6, PANCHKULA. PANCHKULA. PAN: AAALH0022P (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.K.MITTAL, DR RESPONDENT BY : SHRI B.K. NOHRIA DATE OF HEARING : 05.01.2016 DATE OF PRONOUNCEMENT : 07.01.2016 O R D E R PER RANO JAIN, A.M . : THE APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF LEARNED COMMISSIONER OF INC OME TAX (APPEALS), PANCHKULA DATED 29.7.2015 FOR ASSESS MENT YEAR 2009-10. 2. BRIEFLY, THE FACTS OF THE CASE ARE THAT DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE HAS CLAIMED EXPENSES AMOUNTING TO RS.1,27,15,724/- ON ACCOUNT O F MAINTENANCE OF COLONIES, WHEREAS OUT OF THIS EXPEND ITURE AN AMOUNT OF RS.1,25,84,381/- WAS INCURRED FOR 2 CONSTRUCTION OF UNDERGROUND WATER STORAGE TANK AND UP- GRADATION OF ROAD AND WATER DRAINAGE OF HBC VIHAR, GURGAON. AFTER CONSIDERING THE EXPLANATION OF THE ASSESSEE, THE ASSESSING OFFICER CONCLUDED THAT THE BENEFIT OF THIS EXPENDITURE WILL LAST FOR A LONGER PERIOD, THE ;PERMANENT ASSETS ARE BEING CREATED BY INCURRING TH IS EXPENDITURE AND NO INCOME IS BEING RECEIVED AGAINST THE SAID EXPENDITURE. IN THIS VIEW A DISALLOWANCE OF RS.1,25,84,381/- WAS MADE BY THE ASSESSING OFFICER. 3. BEFORE THE LEARNED CIT (APPEALS), IT WAS EXPLAINED THAT THE ASSESSEE HAS INCURRED EXPENDITUR E ON MAINTENANCE OF COLONIES PURELY ON COMMERCIAL EXPEDI ENCY AND TO PROMOTE BUSINESS OF THE ASSESSEE. NO ENDURI NG BENEFIT HAS BEEN RECEIVED BY THE ASSESSEE AND WILL NOT BE RECEIVED IN FUTURE ALSO. FURTHER THE SIMILAR ISSUE HAD ARISEN IN EARLIER YEAR ALSO, WHEREBY RELIEF HAS BEE N GRANTED TO THE ASSESSEE BY THE HON'BLE I.T.A.T. RE LYING ON THE ORDER OF THE I.T.A.T. IN ASSESSEES OWN CASE IN ITA NO.246/CHD/2014 AND ITA NO.741/CHD/2014 DATED 5.6.2015, THE LEARNED CIT (APPEALS) DELETED THE DISALLOWANCE. 4. AGGRIEVED BY THIS ORDER OF THE LEARNED CIT (APPEALS), THE DEPARTMENT HAS COME IN APPEAL, RAISI NG THE FOLLOWING GROUNDS OF APPEAL : 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE LD .CIT(A) HAS ERRED BY DELETING THE ADDI TION MADE ON ACCOUNT OF DISALLOWANCE OF EXPENSES 3 INCURRED ON MAINTENANCE OF COLONIES OF RS.1,25,84, 381/-. 2. IT IS PRAYED THAT THE ORDER OF THE LD. CIT (APPEA L) BE SET-ASIDE AND THAT OF THE A.O. BE RESTORED. 3. THE APPELLANT CRAVES LEAVE TO ADD OR AMEND THE GROUNDS OF APPEAL BEFORE THE APPEAL IS HEARD AND DISPOSED OFF. 5. THE LEARNED D.R. RELIED ON THE ORDER OF THE ASSESSING OFFICER, WHILE THE LEARNED COUNSEL FOR TH E ASSESSEE RELIED ON THE ORDER OF THE LEARNED CIT (AP PEALS) AS WELL AS I.T.A.TS ORDER IN ASSESSEES OWN CASE F OR ASSESSMENT YEAR 2010-11. 6. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BOTH THE PARTIES, PERUSED THE FINDINGS OF THE AUTHO RITIES BELOW AND CONSIDERED THE MATERIAL AVAILABLE ON RECO RD. ON PERUSAL OF THE ORDER OF THE I.T.A.T. IN ASSESSEE S OWN CASE FOR ASSESSMENT YEAR 2010-11, IN ITA NO.246/CHD/2014 & ITA NO.741/CHD/2014 DATED 5.6.2015, WE SEE, ON THE SIMILAR CIRCUMSTANCES, THE ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE. AFTER REFER RING TO THE ORDER OF THE TRIBUNAL IN THE CASE OF PUNJAB UR BAN DEVELOPMENT AUTHORITY, MOHALI VS. ACIT, CHANDIGARH IN ITA NO.759/CHD/2008, THE I.T.A.T. HAS GIVEN ITS FIN DING AT PARA 8, WHICH READS AS UNDER : 8. THOUGH IN THAT CASE THE ISSUE WAS MAINLY DECIDED O N THE BASIS THAT ASSESSEE HAS FOLLOWED CASH SYSTEM OF ACCOUNTING, THEREFORE, ALL EXPENSES ARE TO BE ALLOWE D. THERE 4 IS FURTHER AN OBSERVATION THAT EXPENSES INVOLVED AR E OF REVENUE NATURE. IN THE PRESENT CASE ALSO THE NATURE OF EXPENSES IS UPLIFTMENT OF STREET LIGHTING, DEVELOPME NT AND LAYING OF ROADS, UNDERGROUND TANKS ETC. THESE ASSETS WOULD NEVER BELONG TO THE ASSESSEE BUT WOULD BELONG TO THE COMMUNITY LIVING IN THE COLONY AND THEREFORE, IT CANNO T BE SAID THAT ASSESSEE HAS DERIVED ENDURING BENEFIT FROM SU CH EXPENSES, THEREFORE, IN OUR OPINION, THE ASSESSEE WAS UNDER OBLIGATION TO MAINTAIN THIS COLONY FOR WHICH SUCH EXP ENSE IS A NECESSITY. THEREFORE, WE FIND NOTHING WRONG WI TH THE ORDER OF LD. CIT(A) AND CONFIRM THE SAME. 7. SINCE, NO DISTINGUISHING FACTS WERE BROUGHT TO OUR NOTICE DURING THE COURSE OF HEARING, RESPECTFUL LY FOLLOWING THE FINDINGS OF THE CO-ORDINATE BENCH IN ASSESSEES OWN CASE IN ANOTHER ASSESSMENT YEAR, WE DISMISS THE APPEAL OF THE REVENUE. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 7 TH DAY OF JANUARY, 2016. SD/- SD/- (BHAVNESH SAINI) (RANO JAIN) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 7 TH JANUARY, 2016 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/THE CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH