M.Amutha, Kumbakonam V. ACIT, Kumbakonam

ITA 961/CHNY/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4856 (ITAT-CHENNAI)
• Duration Of Justice: 1 year(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2011
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 16-06-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 15-06-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: R VISWANATHAN
• Assessee Lawyers: S SRIDHAR SHRI G BASKAR

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH C CHENNAI BEFORE DR. O.K. NARAYANAN, VICE-PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER I.T.A.NO. 961/MDS/2010 ASSESSMENT YEAR : 2006-07 M.AMUTHA, W/O MOHAN, 2123, SHANTHI NAGAR, KUMBAKONAM 612 001. PAN AAFPA 8392 N VS. THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-I, KUMBAKONAM. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S. SRIDHAR FOR SHRI G. BASKAR RESPONDENT BY : SHRI R. VI SWANATHAN O R D E R PER DR. O.K. NARAYANAN, VICE-PRESIDENT THIS APPEAL IS FILED BY THE ASSESSEE. THE RELEVANT ASSESSMENT YEAR IS 2006-07. THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) A T TIRUCHIRAPPALLI DATED 14.5.2010. THE APPEAL ARISES OUT OF THE ASSESSMENT COMPLETED UNDER SEC.143(3) OF THE INCOM E-TAX ACT, 1961. ITA 961/10 :- 2 -: 2. THE GROUND RAISED BY THE ASSESSEE IN THE PRESENT CASE IS THAT THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS G ONE WRONG IN CONFIRMING THE ADDITION TOWARDS THE TOTAL COST O F CONSTRUCTION TO THE EXTENT OF ` 6,55,380/-. IT IS THE CASE OF THE ASSESSEE THAT T HE REPORTS OF TWO APPROVED VALUERS SHOULD HAVE BEEN GI VEN DUE CONSIDERATION BY THE COMMISSIONER OF INCOME-TAX (AP PEALS). IT IS ALSO THE CASE OF THE ASSESSEE THAT DISTRICT VALUATI ON OFFICER (DVO) HAS ADOPTED CPWD RATES AS AGAINST THE STATE PWD RA TES AND THIS ITSELF HAS OVERSTATED THE COST OF CONSTRUCTION AT LEAST BY 20%. IT IS TO BE SEEN THAT THE ASSESSEES HUSBAND HAS PR OCURED BUILDING MATERIALS DIRECTLY FROM THE MARKET AND THI S HAS ALSO SAVING SOME ECONOMY AT LEAST TO 10%. 3. ON HEARING BOTH SIDES, WE ARE OF THE OPINION THA T THE ASSESSEE DESERVES RELIEF IN RESPECT OF COST OF CONS TRUCTION ON THE GROUND OF RATE APPLIED BY THE DVO AND ALSO ON ACCOU NT OF NON- CONSIDERATION OF ECONOMY AVAILED BY THE ASSESSEE BY PURCHASING BUILDING MATERIALS DIRECTLY FROM THE MARKET. THE C PWD RATES ADOPTED BY THE DVO HAVE DEFINITELY ENHANCED THE COS T OF CONSTRUCTION AS AGAINST THE STATE PWD RATES IN WHIC H LOCAL CONDITIONS ARE BETTER REFLECTED. LIKE WISE, PROCUR EMENT OF BUILDING ITA 961/10 :- 3 -: MATERIALS DIRECTLY FROM THE MARKET HELPS TO EARN SU BSTANTIAL SAVING AND THIS ECONOMY ALSO COULD CAUSE TO REDUCE THE COS T OF CONSTRUCTION WHEN THESE TWO MATTERS ARE TAKEN INTO CONSIDERATION. WE ARE OF THE VIEW THAT THERE IS NO JUSTIFICATION F OR SUSTAINING THE ADDITION OF ` 6,55,380/-. THE SAID ADDITION IS ACCORDINGLY, DEL ETED. 4. THE ISSUES OF DISALLOWANCE OF ` 24,000/- OUT OF THE ADVERTISEMENT EXPENSES AND ` 1,68,010/- OUT OF THE SALES PROMOTION EXPENSES ARE CONFIRMED AS THEY CANNOT BE TELESCOPED TO OTHER ADDITIONS AS PRAYED FOR BY THE ASSESSEE. 5. IN RESULT, THIS APPEAL FILED BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING, ON THURSDAY, THE 16 TH DAY OF JUNE, 2011 AT CHENNAI. SD/- SD/- (HARI OM MARATHA) (DR.O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 16 TH JUNE, 2011 MPO* COPY TO : APPELLANT/RESPONDENT/CIT/CIT(A)/DR