M/s. Kasturi Housing Pvt. Ltd., Pune V. Principal Commissioner of Income-tax : 6,

ITA 929/PUN/2016

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 0589 (ITAT-PUNE)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 06-05-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D S BENU
• Assessee Lawyers: V L JAIN
• Section: 143(3); 153A; 263; 63; 132

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, PUN E , , !'#'' $ , % & BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM / ITA NO. 929/PN/2016 %' ( ')( / ASSESSMENT YEAR : 2005-06 M/S. KASTURI HOUSING PVT. LTD., 842, BUDHWAR PETH, LAXMI ROAD, PUNE 411002 PAN : AABCK8478Q ....... / APPELLANT ' / V/S. PRINCIPAL COMMISSIONER OF INCOME TAX-6, PUNE / RESPONDENT ASSESSEE BY : SHRI V.L. JAIN REVENUE BY : SHRI D.S. BENUPANI / DATE OF HEARING : 19-10-2016 / DATE OF PRONOUNCEMENT : 21-10-2016 * / ORDER PER VIKAS AWASTHY, JM : THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDE R OF PR. COMMISSIONER OF INCOME TAX-6, PUNE DATED 23-03-2016 PA SSED U/S. 263 OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT). THE ASSESSEE HAS ASSAILED THE JURISDICTION ASSUMED BY TH E PR. COMMISSIONER OF INCOME TAX IN REVISING THE ASSESSMENT ORD ER DATED 28-03-2014 PASSED U/S. 143(3) R.W.S. 254 OF THE ACT. 2 ITA NO. 929/PN/2016, A.Y. 2005-06 2. THE BRIEF FACTS OF THE CASE AS EMANATING FROM RECORD S ARE: THE ORIGINAL ASSESSMENT ORDER FOR THE IMPUGNED ASSESSMENT YE AR WAS PASSED U/S. 143(3) ON 27-12-2007 DISALLOWING THE CLAIM OF DE DUCTION U/S. 80IB(10) OF THE ACT. THE ASSESSEE PREFERRED AN APPE AL BEFORE THE COMMISSIONER OF INCOME TAX (APPEALS) AGAINST DISALLOWING THE C LAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT. THE COMMISSIONER OF IN COME TAX (APPEALS) VIDE ORDER DATED 20-05-2009 UPHELD THE FINDINGS O F ASSESSING OFFICER. THE ASSESSEE CARRIED THE MATTER IN SECOND APPEA L BEFORE THE TRIBUNAL IN ITA NO. 1231/PN/2008 & 1382/PN/2010 FOR ASS ESSMENT YEAR 2005-06. THE TRIBUNAL BY FOLLOWING THE DECISION OF CO- ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS. KRUTI CONSTR UCTION IN ITA NOS. 1031, 1032 & 1033/PN/2011 AND THE DECISION OF MUMBA I BENCH OF THE TRIBUNAL IN THE CASE OF G.V. CORPORATION VS. ITO IN IT A NO. 4512/MUM/2007 ACCEPTED THE CONTENTIONS OF THE ASSESSE E AND REMITTED THE MATTER BACK TO THE FILE OF ASSESSING OFFICER WIT H THE FOLLOWING DIRECTIONS : 5. IN VIEW OF ABOVE DISCUSSION IT IS CLEAR THAT AS SESSEE SHOULD NOT BE SUBJECTED TO SUFFER THE DISALLOWANCE OF CLAIM IN QU ESTION IN CASE RESIDENTIAL UNITS IN QUESTION HAS BEEN CLUBBED SUBS EQUENT TO THE PURCHASE OF FLATS IN QUESTION. THE LOWER AUTHORITI ES WERE NOT HAVING BENEFIT OF DECISION IN THE CASE OF G.V. CORPORATION (SUPRA) ON THE ISSUE AS WELL AS THE DECISION IN THE CASE OF KRUTI CONSTRUCT IONS (SUPRA). SO IN THE INTEREST OF JUSTICE WE SET ASIDE THE ORDER OF THE C IT(A) AND RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A D IRECTION TO DECIDE THE SAME AS PER FACT AND LAW AVAILABLE AT THE RELEVANT POINT OF TIME AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSE E. SIMILAR ISSUE AROSE IN ITA.NO.1382/PN/2010. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, WE SET ASIDE THE ORDER OF THE CIT(A ) AND RESTORE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER WITH A D IRECTION TO DECIDE THE SAME AS PER FACT AND LAW AVAILABLE AT THE RELEVANT POINT OF TIME AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE ASSESSE E. 3. THE ASSESSING OFFICER IN LINE WITH THE DIRECTIONS OF TRIBUN AL ALLOWED THE CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT OF THE ASSESSEE 3 ITA NO. 929/PN/2016, A.Y. 2005-06 VIDE ORDER DATED 28-03-2014. THEREAFTER, ON 11-01-200 8 SEARCH U/S. 132 WAS CONDUCTED ON PRIDE PURPLE GROUP OF COMPANIES. ASSESSEE BELONGS ON THE SAID GROUP. THE ASSESSING OFFICER AGAIN IN A SSESSMENT ORDERS PASSED U/S. 153A R.W.S. 143(3) FOR THE ASSESSMEN T YEARS 2003-04 TO 2006-07 DISALLOWED THE DEDUCTION CLAIMED BY TH E ASSESSEE U/S. 80IB(10). IN FIRST APPEAL, THE COMMISSIONER OF INCOME TA X (APPEALS) BY PLACING RELIANCE ON THE ORDER OF TRIBUNAL IN ITA NOS. 1231 & 1382/PN/2008 (SUPRA) HELD THAT THE ASSESSEE IS ELIGIBLE TO CLAIM DEDUCTION U/S. 80IB(10) OF THE ACT. THE DEPARTMENT CARR IED THE MATTER IN APPEAL BEFORE TRIBUNAL IN ITA NOS. 1073 TO 1076/PN/2013 FOR ASSESSMENT YEAR 2003-04 TO 2006-07. THE TRIBUNAL VIDE ORDER DATED 28-08-2014 AFFIRMED THE FINDINGS OF COMMISSIONER OF INCOME TA X (APPEALS) AND DISMISSED THE APPEALS OF REVENUE. 4. SUBSEQUENTLY, ON 28-01-2016 THE PR. COMMISSIONER OF I NCOME TAX ISSUED NOTICE U/S. 263 OF THE ACT TO THE ASSESSEE. THE RELEVANT EXTRACT OF THE NOTICE READS AS UNDER : SUB : NOTICE U/S. 263 OF THE INCOME TAX ACT 1961 FOR A.Y. 2005-06-REG. K I NDLY REFER TO THE ABOVE 02. IN RESPECT OF ABOVE MENTIONED ASSESSMENT YEAR, IT IS OBSERVED THAT YOU HAD FILED RETURN OF INCOME DECLARING TOTAL INCO ME OF RS . 2,13,882/- AFTER CLAIMING DEDUCTION U/S. 80IB(10) OF THE I.T . ACT OF RS.1 , 04,58 , 412/-. ASSESSMENT U/S. 143(3) DTD.27.12.2007 WAS COMPLETED DETERMINING THE TOTAL INCOME AT RS.1,06,7 2,290/- AFTER DISALLOWING DEDUCTION U/S.80IB(10) OF THE I . T . ACT . ON YOUR APPEAL BEFORE THE CIT(A), THE CIT(A) CONFIRMED THE DISALLO WANCE MADE BY THE AO. FURTHER ON APPEAL BEFORE THE HON'BLE ITAT, THE HON ' BLE ITAT RESTORED THE MATTER BACK TO THE FILE OF THE AO WITH A DIRECTION TO DECIDE THE MATTER AS PER FACT AND AVAILABLE AT THE RELEVAN T POINT OF TIME AFTER PROVIDING DUE OPPORTUNITY OF HEARING TO THE YOU. C ONSEQUENTLY, THE AO PASSED ORDER U/S. 1 43(3) R.W . S. 254 DTD. 28.3.2014 AND ALLOWED DEDUCTION U/S.80IB(10) OF RS . 1,04 , 58 , 412/-. 4 ITA NO. 929/PN/2016, A.Y. 2005-06 03. IT IS FURTHER OBSERVED FROM THE RECORD THAT RE VENUE IS ALREADY IN APPEAL BEFORE THE APPELLATE AUTHORITIES ON THIS ISS UE IN VARIOUS CASES . SINCE THE DEDUCTION U/S . 80IB(10) HAS BEEN WRONGLY ALLOWED TO YOU, THERE IS CONSEQUENT LOSS TO REVENUE . 04. FOR THE REASON STATED HEREINABOVE, THE ORDER DA TED 28.03.2014 MADE BY THE ASSESSING OFFICER IN YOUR CASE FOR THE A.Y. 2005-06 APPEARS TO BE ERRONEOUS IN SO FAR AS IT IS PREJUDIC IAL TO THE INTEREST OF THE REVENUE. ACCORDINGLY BY VIRTUE OF T HE POWER VESTED IN THE UNDERSIGNED AS PER THE PROVISIONS OF SECTION 263 OF THE INCOME TAX ACT 1961, THE SAID ORDER IS PROPOSED TO BE REVISED UNDE R THE SAID SECTION. 05. YOU ARE HEREBY GIVEN AN OPPORTUNITY OF BEING HE ARD TO EXPLAIN AS TO WHY THE PROPOSED REVISION SHOULD NOT BE CARRIED OUT . FOR THIS PURPOSE, YOUR CASE IS POSTED FOR HEARING ON 11/02/2016 AT 11:00 A.M . ON THE SCHEDULED DATE OF HEARING, YOU MAY EITHER AP PEAR IN PERSON OR GET YOURSELF REPRESENTED BY A REPRESENTAT IVE DULY AUTHORIZED BY YOU AS PER SECTION 288 OF THE ACT . YOU MAY ALSO MAKE YOUR WRITTEN SUBMISSIONS IN LIEU OF PERSONAL APPEARANCE . IF SUCH WRITTEN SUBMISSIONS ARE RECEIVED ON OR BEFORE THE SCHEDULED DATE OF HEARING, THE SAME SHALL BE DULY CONSIDERED FOR THE PURPOSE O F THE PROCEEDINGS U/S. 263 OF THE ACT. 5. THE PR. COMMISSIONER OF INCOME TAX VIDE IMPUGNED ORDER PASSED U/S. 263 SET ASIDE THE ASSESSMENT ORDER DATED 28-03-2 014 PASSED BY THE ASSESSING OFFICER U/S. 143(3) R.W.S. 254 HOLDING IT TO BE E RRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENUE. HENCE, THE PR ESENT APPEAL BY THE ASSESSEE. 6. SHRI V.L. JAIN APPEARING ON BEHALF OF THE ASSESSEE SUBMITT ED THAT THE PR. COMMISSIONER OF INCOME TAX HAS ERRED IN ASSUMING REVISIONAL JURISDICTION U/S. 263 OF THE ACT IN A CASE WHERE THE ISSUE RELATING TO ELIGIBILITY OF ASSESSEE TO CLAIM DEDUCTION U/S. 80IB(10) HAS AL READY BEEN DECIDED BY THE TRIBUNAL IN FAVOUR OF THE ASSESSEE. THE ASSESSING OFFICER IN THE ASSESSMENT ORDER WHICH HAS BEEN SET ASIDE IN REVISION HAD MERELY FOLLOWED THE DIRECTIONS OF TRIBUNAL IN ACCEPTING T HE CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT. THE LD. AR FURTHER SUB MITTED THAT A 5 ITA NO. 929/PN/2016, A.Y. 2005-06 PERUSAL OF SHOW CAUSE NOTICE ISSUED U/S. 263 WOULD SHOW T HAT THE PR. COMMISSIONER OF INCOME TAX HAS INITIATED PROCEEDINGS U/S. 2 63 ONLY BECAUSE THE DEPARTMENT IS IN APPEAL IN THE CASE OF SOME OTHER ASSESSEES WHICH INVOLVE CLAIM OF DEDUCTION U/S. 80IB(10) OF TH E ACT. THE PR. COMMISSIONER OF INCOME TAX HAS NOT EXAMINED THE RECORDS OF THE ASSESSEE BEFORE INITIATING PROCEEDINGS U/S. 263 OF THE ACT. 7. ON THE OTHER HAND SHRI D.S. BENUPANI REPRESENTING THE DEPARTMENT VEHEMENTLY DEFENDED THE ACTION OF PR. COMMIS SIONER OF INCOME TAX IN ASSUMING JURISDICTION U/S. 263 AND SETTING A SIDE THE ASSESSMENT ORDER. 8. WE HAVE HEARD THE SUBMISSIONS MADE BY THE REPRESENT ATIVES OF RIVAL SIDES AND HAVE PERUSED THE ORDERS OF THE AUTHORITIE S BELOW. WE HAVE ALSO CONSIDERED THE ORDERS OF CO-ORDINATE BENCH OF THE TRIBUNAL IN ASSESSEES OWN CASE. IT IS AN UNDISPUTED FACT THAT TH E ISSUE RELATING TO ASSESSEES CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT HAD TRAVELLED UP TO THE TRIBUNAL TWICE. THE CO-ORDINATE BENCH OF TRIBUNAL AFTER APPRECIATING THE FACT OF THE CASE AND THE DECISIONS OF THE TRIBUNAL IN SIMILAR CASES HAD REMITTED THE MATTER BACK TO THE FILE OF ASSESSING OFFICER WITH A DIRECTION TO DECIDE THE SAME AS PER FACTS AN D LAW AFTER AFFORDING AN OPPORTUNITY OF HEARING TO THE ASSESSEE. THE ASSESSING OFFICER AFTER APPRECIATING THE FACT IN THE CASE OF ASSESSEE AND IN THE LIGHT OF DECISIONS OF TRIBUNAL IN THE CASES OF ACIT VS. KRUTI CONSTRUCTION (SUPRA) AND G.V. CORPORATION VS. ITO (SUPRA) AC CEPTED THE ASSESSEES CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ACT. THEREAFTER, IN SECOND ROUND RESULTING FROM SEARCH ACTION IN JANUARY, 2008, THE ISSUE RELATING TO ASSESSEES CLAIM OF D EDUCTION U/S. 80IB(10) AGAIN TRAVELED UP TO TRIBUNAL. THE TRIBUNAL BY PLAC ING 6 ITA NO. 929/PN/2016, A.Y. 2005-06 RELIANCE ON ITS EARLIER ORDER DATED 31-10-2012 PASSED IN REGULAR ASSESSMENT PROCEEDINGS REITERATED THE ASSESSEES ELIGIBILIT Y TO CLAIM BENEFIT OF DEDUCTION U/S. 80IB(10) OF THE ACT. 9. IN SUCH CIRCUMSTANCES, WE DO NOT FIND ANY REASON FOR THE PR. COMMISSIONER OF INCOME TAX TO INVOKE THE PROVISIONS OF SEC TION 263 OF THE ACT ON THE SAME ISSUE WHICH HAS ALREADY BEEN ADJU DICATED BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR SAME ASSESSMENT YEA R. A PERUSAL OF THE SHOW CAUSE NOTICE ISSUED U/S. 263 WHICH HAS BEEN REPRODUCED IN PARA 3 ABOVE WOULD SHOW THAT NO REASON HAS BEEN GIVEN BY THE PR. COMMISSIONER OF INCOME TAX FOR INVOKING THE PROVISIONS OF SE CTION 263 EXCEPT FOR THAT IN THE CASE OF SOME OTHER ASSESSEES, TH E DEPARTMENT IS IN APPEAL AGAINST THE GRANT OF DEDUCTION U/S. 80IB(10) OF TH E ACT. THE REASON GIVEN BY THE PR. COMMISSIONER OF INCOME TAX IN NOT ICE BY NO STRETCH OF IMAGINATION CAN BE CONSIDERED AS A VALID REASON FOR INVOKING THE PROVISIONS OF SECTION 263 OF THE ACT. 10. IT IS A WELL SETTLED LAW THAT TO ASSUME THE JURISDICT ION U/S. 263 OF THE ACT, THE COMMISSIONER OF INCOME TAX/PR. COMMISSIONER OF INCOME TAX HAS TO BE SATISFIED WITH THE TWIN CONDITIONS I.E. I. THE ORDER OF ASSESSING OFFICER SOUGHT TO BE REVISED IS ER RONEOUS; AND II. IT IS PREJUDICIAL TO THE INTEREST OF REVENUE. IF ANY OF THE ABOVE CONDITION IS ABSENT, THE COMMISSIONER C ANNOT TAKE RECOURSE TO THE PROVISIONS OF SECTION 263 OF THE AC T. IN THE PRESENT CASE THE ASSESSING OFFICER PASSED THE ORDER IN COMPLIANCE WITH THE DIRECTIONS OF TRIBUNAL. MERELY, FOR THE REASON THAT THE AS SESSING OFFICER ALLOWED THE CLAIM OF DEDUCTION U/S. 80IB(10) OF THE ASSESSEE THE ORDER 7 ITA NO. 929/PN/2016, A.Y. 2005-06 CANNOT BE SAID TO BE ERRONEOUS. THE PR. COMMISSIONER OF INCOME TAX ERRED IN INVOKING THE PROVISIONS OF SECTION 263 TO REVISE THE ASSESSMENT ORDER PASSED IN LINE WITH THE DIRECTIONS OF THE TRIBUNAL. THUS, IN THE FACTS AND CIRCUMSTANCES OF THE PRESENT CAS E WE ARE OF THE CONSIDERED VIEW THAT THE PR. COMMISSIONER OF INCOM E TAX HAD WRONGLY ASSUMED JURISDICTION U/S. 263 OF THE ACT. ACCORD INGLY, THE IMPUGNED ORDER IS SET ASIDE AND THE APPEAL OF THE ASSESSEE IS ALLOWED. 11. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON FRIDAY, THE 21 ST DAY OF OCTOBER, 2016. SD/- SD/- ( . . / R.K. PANDA) ( ! ' / VIKAS AWASTHY) #' / ACCOUNTANT MEMBER $ % #' / JUDICIAL MEMBER / PUNE; &# / DATED : 21 ST OCTOBER, 2016 RK *+,%-.#/#)- / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. PR. COMMISSIONER OF INCOME TAX-6, PUNE 4. !'( %%)* , )* , + +,- , / DR, ITAT, B BENCH, PUNE. 5. ( . /0 / GUARD FILE. // ! % // TRUE COPY// #1 / BY ORDER, %2 )- / PRIVATE SECRETARY, )* , / ITAT, PUNE