DCIT, Chandigarh V. Sh. Sham Sunder Sharma, Chandigarh

ITA 966/CHANDI/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90196 (ITAT-CHANDIGARH)
• Duration Of Justice: 7 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-06-2015
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 08-06-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 07-11-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: MANJIT SINGH
• Assessee Lawyers: N K SAINI
• Keywords: Opportunity of being heard; Additional evidence; Competent authority
• Section: 80IB; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 966/CHD/2014 (ASSESSMENT YEAR : 2007-08) THE D.C.I.T., VS. SH.SHAM SUNDER SHARMA, CIRCLE 1(1), SCO 220, SECTOR 9-C, CHANDIGARH. CHANDIGARH. PAN: AIIPS8699B (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI MANJIT SINGH, DR RESPONDENT BY : SHRI N.K.SAINI DATE OF HEARING : 08.06.2015 DATE OF PRONOUNCEMENT : 16.06.2015 O R D E R PER BHAVNESH SAINI, J.M. : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAIN ST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS), CHANDIGARH DATED 22.8.2014 FOR ASSESSMENT YEAR 2007 -08 ON THE FOLLOWING GROUNDS : 1. THE LD. CIT (A) HAS ERRED IN ALLOWING THE APPEA L OF THE ASSESSEE WITHOUT APPRECIATING THE FACTS OF THE CASE. 2. THE LD. CIT(A) HAS ERRED IN ALLOWING THE CLAIM U/ S 80IB(10) OF THE ACT WITHOUT COMPLETION CERTIFICATE ISSUED BY THE CO MPETENT AUTHORITY BY SIMPLY RELYING ON THE ORDER OF HIS PREDE CESSOR AND WITHOUT CONSIDERING THE CONTENTION OF THE REVENUE AS DIRECTED 2 BY THE HON'BLE 1TAT VIDE ORDER DATED: 23.11.2011 I N IT A NO. 330/CHD/2011. 2. BRIEF FACTS OF THE CASE ARE THAT M/S SWASTIK CONSTRUCTIONS, A PROPRIETORSHIP CONCERN OF THE ASSE SSEE, HAD UNDERTAKEN A CONSTRUCTION PROJECT AT PANCHKULA AND CLAIMED PROFIT FROM THIS PROJECT OF RS.41,15,216/- AS DEDUCTION UNDER SECTION 80IB(10) OF THE INCOME TAX ACT,1961 (HEREINAFTER REFERRED TO AS ACT). THE ASSESSING OFFICER EXAMINED THE GENUINENESS OF CLAIM OF DEDUCTION UNDER SECTION 80IB(10) OF THE ACT. THE ASSESSING OFFICER ON THE BASIS OF THE INQUIRIES MAD E, FOUND THAT THE PROJECT WAS GRANTED APPROVAL ON 15.02.1996 I.E. MUCH BEFORE THE DATE OF OCTOBER, 19 98, PROVIDED IN THE ACT FOR CLAIMING DEDUCTION UNDER SE CTION 80IB(10) OF THE ACT. THE ASSESSEE HAD ALSO NOT FURNISHED COMPLETION CERTIFICATE OF THE LOCAL AUTHO RITY THAT THE PROJECT WAS COMPLETED BY 31.03.2008. THE ASSESSING OFFICER ACCORDINGLY REJECTED ASSESSEES C LAIM OF DEDUCTION UNDER SECTION 80IB(10) OF THE ACT. 3. BEING AGGRIEVED, THE ASSESSEE FILED APPEAL BEFORE THE LEARNED CIT (APPEALS). THE ASSESSEE DURING COURSE OF APPELLATE PROCEEDINGS FILED A COPY OF LETTER 12.04. 1999 FROM THE DIRECTOR, TOWN AND COUNTRY PLANNING, CHANDIGARH REGARDING APPROVAL OF SERVICE PLAN/ ESTIMATES IN RESPECT OF GROUP HOUSING COLONY IN SWASTIK VIHAR, MANSA DEVI C OMPLEX, SECTOR-5, PANCHKULA IN AN AREA OF 2.99 ACRES AT PAN CHKULA. AS PER THIS LETTER, THE APPROVAL FOR 2.99 ACRES GRO UP HOUSING 3 SCHEME WAS GRANTED BY THE CHIEF ENGINEER, HUDA WITH CERTAIN TERMS AND CONDITIONS AND FROM THIS LETTER, THE LEAR NED CIT (APPEALS) INFERRED THAT APPROVAL FOR THE PROJECT WA S GRANTED BY THE COMPETENT AUTHORITY AFTER 01.10.1998. THE ASSE SSEE HAD ALSO FILED A COPY OF LETTER DATED 18.05.2010 ISSUED BY THE DIRECTOR, TOWN AND COUNTRY PLANNING, HARYANA, CHAN DIGARH; VIDE WHICH PERMISSION FOR OCCUPATION OF THE BUILDIN G AFTER CHARGING THE COMPOSITION CHARGES FEE WAS GRANTED TO THE ASSESSEE WITH CERTAIN TERMS AND CONDITIONS. THE A SSESSEE HAD ALSO FILED ANOTHER LETTER DATED 09.08.2010 ISSU ED BY DISTRICT TOWN PLANNER(HQ.) [FOR DIRECTOR, TOWN AND COUNTRY PLANNING, HARYANA, CHANDIGARH], CLARIFYING THAT THE LETTER DATED 18.05.2010 ISSUED BY THE DIRECTOR, TOWN AND COUNTRY PLANNING, HARYANA, CHANDIGARH MAY BE CONSIDERED AS COMPLETION CERTIFICATE. AS THE COMPLETION CERTIFIC ATE ISSUED BY THE COMPETENT AUTHORITY WAS NOT FILED BEFORE THE AS SESSING OFFICER, THE SAME WAS FORWARDED BY THE LEARNED CIT (APPEALS) TO THE ASSESSING OFFICER FOR VERIFICATION WITH THE FOLLOWING DIRECTIONS: 2 DURING THE ASSESSMENT PROCEEDINGS ASSESSING OFF ICER OBSERVED THAT THE ASSESSEE HAD NOT FURNISHED COMPLETION CERTIFICA TE FROM THE GOVERNMENT AUTHORITIES, WHICH IS MANDATORY REQUIREMENT FOR CLA IMING EXEMPTION U/S 80IB(10), RESULTING IN DENIAL OF DEDUCTION U/S 80IB (10). 3 DURING THE APPELLATE PROCEEDINGS, THE APPELLANT HAS FAMISHED COMPLETION CERTIFICATE ISSUED BY DIRECTORATE OF TOW N & COUNTRY PLANNING, HARYANA VIDE LETTERS BEARING NO. ZP/-24-JD(B)-2010/ 6499 DATED 18.05.2010 AND ZP-24-SD(B)-2010/9844 DATED 9.8.10. ON FURTHER VERIFICATION FROM THE O/O DIRECTORATE OF TOWN & COU NTRY PLANNING, HARYANA REGARDING VALIDITY OF THE COMPLETION CERTIFICATE, THIS OFFICE WAS INFORMED THAT SINCE 4 THE RESIDENTIAL COLONY FALLS UNDER THE PERIPHERY CO NTROLLED AREA ACT, THERE IS NO PROVISION IN THE ACT TO GIVE COMPLETION CERTIFICAT E AND THEREFORE, THE OCCUPATION CERTIFICATE ISSUED BY THE DIRECTOR, TOWN AND COUNTRY PLANNING, HARYANA MAY BE TREATED AS COMPLETION CERTIFICATE. S INCE THIS CERTIFICATE WAS NOT FURNISHED DURING THE ASSESSMENT PROCEEDINGS, TH E COPIES OF THESE LETTERS/CERTIFICATES ARE BEING FORWARDED TO YOU. 4. IN THIS REGARD, YOU ARE REQUESTED TO VERIFY THE ABO VE FACTS AND SUBMIT REPORT REGARDING ALLOWABILITY OF DEDUCTION U/S 80IB (10) IN VIEW OF CERTIFICATE RECEIVED FROM THE O/O DIRECTORATE OF TOWN & COUNTRY PLANNING, HARYANA AFTER VERIFYING THE FOLLOWING FACTS:- 1. WHETHER THE AREA FALLS UNDER PERIPHERY CONTROLLE D AREA ACT? IF YES. 2. WHETHER THERE IS NO PROVISIONS OF ISSUE OF COMPL ETION CERTIFICATE UNDER THIS ACT? 3. WHAT ARE THE PROVISIONS FOR ISSUE OF COMPLETION CERTIFICATE UNDER THE HARYANA DEVELOPMENT AND REGULATION OF URBAN ARE AS ACT, 1975? 4. THE ASSESSING OFFICER IN RESPONSE TO THE LETTER OF THE LEARNED CIT (APPEALS) SUBMITTED THE REPORT, WHICH I S REPRODUCED BELOW FOR THE SAKE OF THE READY REFERENCE: A. YES, THE 2.99 ACRE SITE DOES FALL UNDER THE JUR ISDICTION OF THE PUNJAB NEW CAPITAL PERIPHERY CONTROL ACT 1952. B. NO, THERE IS NO STATUTORY PROVISION UNDER TH E PUNJAB NEW CAPITAL PERIPHERY CONTROL ACT, 1952 REGARDING OBTAINING COMPLETION CE RTIFICATE FOR ANY PROJECT WHICH IS SANCTIONED UNDER THE SAID ACT. C. UNDER THE HARYANA DEVELOPMENT AND REGULATION OF URBAN AREAS RULES, 1976, THE PROVISION FOR GRANT OF COMPLETION CERTIFICATE E XISTS UNDER RULE 16, WHICH IS REPRODUCED BELOW FOR READY REFERENCE. COMPLETION CERTIFICATE/PART COMPLETION CERTIFICAT E / SECTION 24/- 5 1) AFTER THE COLONY HAS BEEN LAID OUT ACCORDING TO A PPROVED LAYOUT PLANS AND DEVELOPMENT WORKS HAVE BEEN EXECUTED ACCORDING TO THE APPROVED DESIGNS AND SPECIFICATIONS THE COLONIZER SHALL MAKE AN APP LICATION TO THE DIRECTOR IN FORM LC-VIII. 2) AFTER SUCH (SCRUTINY), AS MAY BE NECESSARY T HE DIRECTOR MAY ISSUE A COMPLETION CERTIFICATE/PART COMPLETION CERTIFICATE IN FORM LC-K OR REFUSE TO ISSUE SUCH CERTIFICATE STATING THE REASONS FOR SUC H REFUSAL: PROVIDED THAT THE COLONIZER SHALL BE AFFORDED AN OP PORTUNITY OF BEING HEARD BEFORE SUCH REFUSAL. IT IS ALSO CONFIRMED THAT SINCE THE PERMISSION IN T HE PRESENT CASE STANDS GRANTED UNDER THE PUNJAB NEW CAPITAL PERIPHERY CONTROL ACT, 1952 THE PROVISIONS OF HARYANA DEVELOPMENT AND REGULATION OF URBAN AREAS A CT, 1975 ARE NOT APPLICABLE ON THE ABOVEMENTIONED 2.99 ACRE RESIDENT IAL COLONY DEVELOPED BY SH. SHAM SUNDER. 4. THE LEARNED CIT (APPEALS) AFTER TAKING INTO CONSIDERATION THE REPORT OF THE ASSESSING OFFICER, HELD THAT IN THE ABSENCE OF ANY SPECIFIC PROVISION REGARDING ISS UANCE OF COMPLETION CERTIFICATE IN PUNJAB NEW CAPITAL PERIPH ERY CONTROL ACT, 1952; THE OCCUPATION CERTIFICATE ISSUE D BY DISTRICT TOWN AND COUNTRY PLANNING, HARYANA, CHANDI GARH WAS TO BE TREATED AS COMPLETION CERTIFICATE, ISSUED BY THE GOVERNMENT AUTHORITIES FOR THE PURPOSES OF CLAIMING EXEMPTION U/S 80IB OF THE ACT. THE DEDUCTION CLAIME D U/S 80IB(10) OF THE ACT WAS ACCORDINGLY ALLOWED. 5. THE REVENUE HAD FILED APPEAL BEFORE THE TRIBUN AL AND THE TRIBUNAL REMANDED THE MATTER TO THE LEARNED CIT (APPEALS) VIDE ITS ORDER DATED 23.11.2011 IN 1TA NO . 330/CHD/2011 WITH THE FOLLOWING DIRECTIONS: 6 IN THIS CASE, THE ASSESSING OFFICER HAD DENIED THE CLAIM OF THE ASSESSEE ON TWO COUNTS. FIRSTLY, ON THE GROUND THAT THE PROJECT WAS GRANTED APPROVAL ON 15.2.1996 I.E. MUCH BEFORE THE DATE I.E. OCTOBER, 1 998 AS PROVIDED IN SECTION 80IB(1) OF THE I.T. ACT. SECONDLY, THE PROJECT WAS NOT COMPLETED BY MARCH 31, 2008 AS THE ASSESSEE FAILED TO FURNISH THE COMPLETI ON CERTIFICATE FROM THE LOCAL AUTHORITY. AS REGARDS, THE REJECTION OF THE A SSESSEE'S CLAIM ON FIRST GROUND BY THE ASSESSING OFFICER, THE CTT(A) HAS NOT GIVEN ANY FINDINGS, THEREFORE, THE ORDER OF CFT(A) IS BAD IN LAW AND DE SERVES TO BE SET ASIDE. IN FACT THE ASSESSEE HAS RAISED A SPECIFIC GROUND I.E. GROUND NO.3 BEFORE THE CIT(A) AND THE CTT(A) HAS NOT CONSIDERED AND DECIDE D THIS GROUND OF APPEAL. THE CTT(A) WAS REQUIRED TO GIVE HIS FINDINGS ON THI S ISSUE ALSO AND THEREFORE, WE HOLD THE IMPUGNED ORDER AS BAD IN LAW. CONSEQUEN TLY, WE REMAND THE MATTER TO CIT(A) WITH A DIRECTION TO DECIDE AND GIV E HIS FINDINGS WITH REGARD TO ISSUE RAISED BY THE ASSESSEE VIDE GROUND NO.3 OF THE APPEAL. 7. THE SECOND GROUND FOR REJECTING THE CLAIM U/S 80 IB(10) OF THE ACT IS THAT PROJECT WAS NOT COMPLETED BY 31.3.2008 AS THE ASSESSEE HAS FAILED TO FURNISH THE COMPLETION CERTIFICATE FROM THE LOCAL A UTHORITY. IT IS APPARENT FROM THE RECORD THAT BEFORE THE CIT(A), THE ASSESSEE FUR NISHED A LETTER DATED 18.5.2010 ISSUED BY DISTRICT TOWN PLANNER, HARYANA, CHANDIGARH. THE ASSESSEE ALSO FILED ANOTHER LETTER DATED 9.8.2010 I SSUED BY DISTRICT TOWN PLANNER, HARYANA, CHANDIGARH CLARIFYING THE LETTER DATED 18.5.2010 ISSUED BY DISTRICT TOWN AND PLANNER, HARYANA, CHANDIGARH. THE CTT(A) TREATED THESE LETTERS AS COMPLETION CERTIFICATE ISSUED BY G OVERNMENT AUTHORITIES FOR CLAIMING EXEMPTION U/S 80IB OF THE ACT. THESE LETTE RS ARE AVAILABLE AT PAGES 15 TO 17 OF THE ASSESSEE'S PAPER BOOK. SHRI AKHILES H GUPTA, LD. DR POINTED OUT THAT LETTER DATED 9.8.2010 ISSUED BY DISTRICT, TOWN PLANNER, HARYANA, CHANDIGARH CANNOT BE CONSIDERED AS COMPLETION CERTI FICATE. IN THIS LETTER, IT IS STATED THAT REGARDING PROVISIONS OF RAIN WATER H ARVESTING SYSTEM WHICH IS FUNCTIONAL AT SITE, THERE IS NO REQUIREMENT FOR OBTAINING THE COMPLETION CERTIFICATE. SHRI AKHILESH GUPTA, LD. DR ALSO SUBMI TTED THAT LETTER DATED 18.5.2010 ISSUED BY DISTRICT TOWN PLANNER, CHANDIGA RH ALSO CANNOT BE CONSIDERED AS COMPLETION CERTIFICATE. ACCORDING TO HIM, VIDE THIS LETTER THE DISTRICT TOWN PLANNER HAS GRANTED PERMISSION FOR OC CUPATION OF THE BUILDING AFTER CHARGING CERTAIN AMOUNT SUBJECT TO THE FOLLOW ING CONDITIONS: 7 --------------------------------------------------- ----------------------------------------------- --------------------------------------------------- ----------------------------------------------- 8. THE ASSESSEE WAS REQUIRED TO FULFILL THE ABOV E CONDITIONS. SHRI AKHILESH GUPTA, LD. DR SUBMITTED THAT BY NO STRETCH OF IMAGINATION THE ABOVE LETTERS CAN BE CONSIDERED AS COMPLETION CERTI FICATE BY LOCAL AUTHORITY AS PER LAW. 9. CONSIDERING THE ENTIRE FACTS AND CIRCUMSTANCES OF T HE PRESENT CASE, WE SET ASIDE THE ORDER OF CIT(A) IN TOTO AND REMAND THE MATTER TO THE CTT(A) WITH A DIRECTION TO DECIDE THE MATTER AFRESH I N ACCORDANCE WITH LAW CONSIDERING THE CONTENTIONS RAISED BY THE LD. DR. THE CIT(A) SHALL GIVE AN OPPORTUNITY OF BEING HEARD TO THE ASSESSEE IN THE M ATTER. AS THE SAME TIME, WE ALSO DIRECT THE LD. CIT(A) TO DISPOSE OF THE ASS ESSEE'S APPEAL PREFERABLY WITHIN THREE MONTHS FROM THE DATE OF RECEIPT OF ORD ER, (SIC) 6. THE LEARNED CIT (APPEALS) IN VIEW OF THE DIRECT IONS OF THE TRIBUNAL REFIXED THE APPEAL FOR HEARING AND AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE PASSED THE FOLLOWING ORDER IN PARAS 3 TO 5 OF THE IMPUGNED ORD ER ALLOWING THE APPEAL OF THE ASSESSEE. THE FINDINGS OF THE LEARNED CIT (APPEALS) ARE REPRODUCED AS UNDER : 3. THE HON'BLE ITAT, CHANDIGARH HAS DIRECTED TO D ECIDE GROUND OF APPEAL NO. 3 RAISED BY THE APPELLANT IN THE ORIGINA L APPEAL PROCEEDINGS. THIS GROUND IS AGAINST REJECTION OF CLAIM U/S 80IB(10) O N THE GROUND THAT THE PROJECT WAS APPROVED ON 15.02.1996, WHICH IS MUCH B EFORE OCTOBER, 1998 WHEREAS APPROVAL FOR DEVELOPMENT AND CONSTRUCTION W AS ACCORDED ON 12.04.1999. IN SUPPORT OF THIS GROUND, THE APPELLAN T HAD FILED A COPY OF LETTER BEARING NO. 5DP(III)-99/4560 DATED 12.04.1999 ISSUE D BY THE DIRECTOR, TOWN AND COUNTRY PLANNING, HARYANA, CHANDIGARH REGARDING APPROVAL OF SERVICE PLAN/ESTIMATES IN RESPECT OF GROUP HOUSING COLONY IN SWASTIK VIHAR, MANSA DEVI COMPLEX, SECTOR 5, PANCHKULA IN AN AREA OF 2.99 ACRES AT PANCHKULA BEFORE MY PREDECESSOR, WHO AFTER GOING T HROUGH THE TERMS & 8 CONDITIONS MENTIONED IN THIS LETTER HAS CONCLUDED I N PARA 7 OF HER ORDER (SUPRA) AS UNDER: THUS, FROM THE ABOVE IT CLEAR THAT APPROVAL FOR TH E PROJECT WAS GRANTED BY THE COMPETENT AUTHORITY AFTER 1.10.1998. 3.1 FROM THE ABOVE, IT IS EVIDENT THAT MY PREDECES SOR HAD TAKEN A PARTICULAR VIEW IN THE MATTER. IN THE ABSENCE OF AN Y ADDITIONAL EVIDENCE/ INFORMATION BEFORE ME, I CANNOT SIT IN JUDGEMENT OV ER THE VIEW TAKEN BY MY PREDECESSOR. IN ANY CASE, IN MY OPINION, THE VIEW T AKEN BY MY PREDECESSOR WAS CORRECT. GROUND OF APPEAL NO. 3 IS ALLOWED. 4. THE NEXT ISSUE TO BE ADJUDICATED AS PER THE HON 'BLE ITAT, CHANDIGARH ORDER IS REGARDING COMPLETION OF THE PRO JECT. THE PLEA OF THE DEPARTMENT BEFORE HON'BLE ITAT, CHANDIGARH WAS THAT THE LETTER DATED 18.05.2010 ISSUED BY DISTRICT TOWN PLANNER, HARYANA , CHANDIGARH COULD NOT BE CONSIDERED AS COMPLETION CERTIFICATE. BY THIS LE TTER; THE DIRECTOR, TOWN AND COUNTRY PLANNING, HARYANA, CHANDIGARH HAD GRANT ED PERMISSION FOR OCCUPATION OF THE BUILDING AFTER CHARGING THE COMPO SITION CHARGES FEE WITH CERTAIN TERMS & CONDITIONS. THE APPELLANT HAD ALSO FILED ANOTHER LETTER DATED 09.08.2010 ISSUED BY DISTRICT TOWN PLANNER (HQ.) [F OR DIRECTOR, TOWN AND COUNTRY PLANNING, HARYANA, CHANDIGARH] IN THE APPEL LATE PROCEEDINGS BEFORE MY PREDECESSOR, WHICH HAD CLARIFIED AGAIN TH AT THE OCCUPATION CERTIFICATE DATED 18.05.2010 MAY BE CONSIDERED AS C OMPLETION CERTIFICATE. MY PREDECESSOR HAD FORWARDED THESE LETTERS DATED 18.05 .2010 AND 09.08.2010 TO THE ASSESSING OFFICER, WITH CERTAIN DIRECTIONS (REP RODUCED IN PARA 1.1 OF THIS ORDER) AND AFTER GETTING REPORT OF THE ASSESSING OF FICER, HAD CONCLUDED THAT IN THE ABSENCE OF ANY SPECIFIC PROVISION REGARDING ISSUANCE OF COMPLETION CERTIFICATE IN PUNJAB NEW CAPITAL PERIPHERY CONTROL ACT, 1952; THE OCCUPATION CERTIFICATE ISSUED BY THE DISTRICT TOWN PLANNER WAS TO BE TAKEN AS COMPLETION CERTIFICATE ISSUED BY GOVERNMENT AUTH ORITIES FOR CLAIMING EXEMPTION U/S 80IB. ON THE FACTS AND CIRCUMSTANCES AND THE EVIDENCES PRODUCED REGARDING COMPLETION OF THE PROJECT, I FIN D THAT THE VIEW TAKEN BY MY PREDECESSOR WAS CORRECT. THE APPELLANT IS DULY E LIGIBLE FOR THE DEDUCTION CLAIMED U/S 80IB(10) OF THE ACT. THE MATTER RESTORE D BY HONBLE ITAT, CHANDIGARH IS DISPOSED OF ACCORDINGLY AND FOR STATI STICAL PURPOSES, THE APPEAL IS TREATED AS ALLOWED. 5. IN THE RESULT, THE APPEAL IS ALLOWED 9 7. WE HAVE HEARD THE LEARNED REPRESENTATIVES OF BO TH THE PARTIES AND PERUSED THE MATERIAL AVAILABLE ON R ECORD. THE LEARNED D.R FOR THE REVENUE FILED COPY OF THE E ARLIER ORDER OF THE TRIBUNAL DATED 23.11.2011 PASSED IN TH E DEPARTMENTAL APPEAL IN THE CASE OF THE ASSESSEE AS IS REFERRED TO ABOVE AND SUBMITTED THAT THE LEARNED CIT (APPEAL S) IS REQUIRED TO FOLLOW THE ORDER OF THE TRIBUNAL AND SH OULD HAVE PASSED REASONED ORDER. THE LEARNED D.R FOR THE RE VENUE SUBMITTED THAT THE LEARNED CIT (APPEALS) IN DEFIANC E OF THE ORDER OF THE TRIBUNAL HAS MERELY FOLLOWED THE ORDER OF THIS PREDECESSOR, WHICH DOES NOT EXIST IN THE EYES OF TH E LAW. THEREFORE, RELIANCE OF THE LEARNED CIT (APPEALS) ON THE EARLIER ORDER OF HIS PREDECESSOR DATED 1.11.2010 IS WHOLLY MISPLACED AND IS A CLEAR VIOLATION OF THE ORDER OF THE TRIBUN AL. THE LEARNED D.R FOR THE REVENUE SUBMITTED THAT THE LEAR NED CIT (APPEALS) SHOULD NOT HAVE FOLLOWED THE ORDER OF HIS PREDECESSOR BECAUSE IT IS ALREADY SET ASIDE BY THE TRIBUNAL AND THE LEARNED CIT (APPEALS) SHOULD HAVE DECIDED T HE APPEAL OF THE ASSESSEE STRICTLY ON MERITS FOLLOWING THE OR DER OF THE TRIBUNAL DATED 23.11.2011. THE LEARNED D.R FOR THE REVENUE, THEREFORE, SUBMITTED THAT THE ORDER OF THE LEARNED CIT (APPEALS) MAY BE SET ASIDE AND THE MATTER MAY BE RE MANDED TO THE FILE OF THE LEARNED CIT (APPEALS) FOR DECIDI NG THE APPEAL AFRESH IN ACCORDANCE WITH LAW AND IN ACCORDANCE WIT H THE DIRECTIONS OF THE TRIBUNAL DATED 23.11.2011. 8. ON THE OTHER HAND, THE LEARNED COUNSEL FOR ASSE SSEE DEFENDED THE ORDER OF THE LEARNED CIT (APPEALS) AND 10 SUBMITTED THAT THE LEARNED CIT (APPEALS) CORRECTLY FOLLOWED THE ORDER OF HIS PREDECESSOR BECAUSE ALL MATERIAL W AS AVAILABLE BEFORE THE LEARNED CIT (APPEALS) FOR GIVI NG RELIEF TO THE ASSESSEE. HE HAS ALSO SUBMITTED THAT EVEN MAT ERIAL WAS AVAILABLE IN THE FIRST ROUND OF PROCEEDINGS BEFORE THE TRIBUNAL, THEREFORE, THERE IS NO NEED TO REMAND THE MATTER TO THE FILE OF THE LEARNED CIT (APPEALS) AGAIN. 9. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. IT IS N OT IN DISPUTE THAT EARLIER THE LEARNED CIT (APPEALS) DECI DED THE APPEAL OF THE ASSESSEE VIDE ORDER DATED 1.11.2010, AGAINST WHICH THE REVENUE PREFERRED APPEAL BEFORE THE TRIBU NAL IN ITA NO.330/CHD/2011 AND THE TRIBUNAL DECIDED HE DEPARTMENTAL APPEAL VIDE ORDER DATED 23.11.2011 AND THE OPERATIVE PORTION OF THE ORDER OF THE TRIBUNAL IS R EPRODUCED ABOVE. IT WOULD MEAN THAT THE TRIBUNAL WHILE DECIDING THE DEPARTMENTAL APPEAL HAS SET ASIDE THE EARLIER O RDER OF THE LEARNED CIT (APPEALS) DATED 1.11.2010 GIVING SUBSTA NTIAL RELIEF TO THE ASSESSEE. THUS THE EARLIER ORDER OF THE PREDECESSOR OF THE LEARNED CIT (APPEALS) DATED 1.11 .2010 DOES NOT EXIST IN THE EYES OF LAW. IT COULD NOT B E TAKEN INTO CONSIDERATION FOR ANY PURPOSE AND EVEN THE SAME IS NOT AN ORDER IN THE EYES OF LAW. THE REVENUE CONTENDED B EFORE THE TRIBUNAL THAT THE PROJECT WAS GRANTED APPROVAL ON 1 5.2.1996 I.E. BEFORE OCTOBER, 1998 AND FURTHER NO COMPLETION CERTIFICATE FROM THE LOCAL AUTHORITY HAVE BEEN FILE D. THE TRIBUNAL NOTED IN ITS FINDING THAT THE CIT (APPEAL S) HAS NOT 11 GIVEN ANY FINDINGS, THEREFORE, ITS ORDER IS BAD IN LAW AND DESERVES TO BE SET ASIDE. WITH REGARD TO THE FIL ING OF THE COMPLETION CERTIFICATE IS CONCERNED, THE TRIBUNAL A LSO SET ASIDE THE ORDER OF THE LEARNED CIT (APPEALS) AND RE MANDED THE MATTER TO THE LEARNED CIT (APPEALS) WITH DIRECT ION TO DECIDE THE MATTER AFRESH IN ACCORDANCE WITH LAW CON SIDERING THE CONTENTION RAISED BY THE LEARNED D.R FOR THE RE VENUE. THE LEARNED CIT (APPEALS) INSTEAD OF FOLLOWING THE ORDER OF THE TRIBUNAL DATED 23.11.2011 AND WITHOUT CONSIDERI NG THE EVIDENCES AND MATERIAL ON RECORD AND WITHOUT GIVING HIS INDEPENDENT OPINION ON THE MATTER IN ISSUE HAS PREF ERRED TO FOLLOW THE ORDER OF HIS PREDECESSOR DATED 1.11.2010 IN ALLOWING THE APPEAL OF THE ASSESSEE. EVEN THE LEA RNED CIT (APPEALS) HAS QUOTED SOME PORTION OF THE ORDER OF H IS PREDECESSOR IN THE IMPUGNED ORDER. THE LEARNED CI T (APPEALS) ALSO BLATANTLY OBSERVED IN THE IMPUGNED O RDER THAT HE CANNOT SIT IN JUDGMENT OVER THE VIEW TAKEN BY HI S PREDECESSOR. THE FINDINGS OF THE LEARNED CIT (APP EALS) NOTED ABOVE, CLEARLY SHOW THAT THE LEARNED CIT (APPEALS) INSTEAD OF DECIDING THE APPEAL ON MERITS AND IN COMPLIANCE WIT H THE ORDER OF THE TRIBUNAL DATED 23.11.2011 PREFERRED TO FOLLOW THE VIEW AND ORDER PASSED BY HIS PREDECESSOR. THE LEARNED CIT (APPEALS) HAS EVEN GONE TO THE EXTENT OF NOTING IN THE IMPUGNED ORDER THAT THE VIEW TAKEN BY HIS PREDECESS OR WAS CORRECT. THUS IT IS CLEAR THAT THE LEARNED CIT (A PPEALS) HAS SHOWN DISOBEDIENCE TO THE ORDER OF THE TRIBUNAL DAT ED 23.11.2011. AS NOTED ABOVE, WHEN THE EARLIER ORDE R OF THE PREDECESSOR OF THE LEARNED CIT (APPEALS) DATED 1.11 .2010 WAS 12 SET ASIDE BY THE TRIBUNAL IN TOTO AND THE MATTER IS REMANDED TO HIM FOR PASSING THE ORDER AFRESH STRICTLY IN ACC ORDANCE WITH LAW, THE EARLIER ORDER OF THE PREDECESSOR OF T HE LEARNED CIT (APPEALS) WOULD NOT STAND IN THE EYES OF LAW. THEREFORE, THE LEARNED CIT (APPEALS) HAS GRAVELY ERRED IN QUOT ING THE PORTION OF THE ORDER OF HIS PREDECESSOR IN THE IMPU GNED ORDER. THE LEARNED CIT (APPEALS) HAS ALSO GRAVELY ERRED IN FINDING THAT THE VIEW TAKEN BY HIS PREDECESSOR WAS CORRECT. THE LEARNED CIT (APPEALS) FAILED TO NOTE THAT WHEN EARLIER ORDER OF HIS PREDECESSOR WAS SUBJECT MATTER IN DEPA RTMENTAL APPEAL BEFORE THE TRIBUNAL AND THE ORDER OF HIS PRE DECESSOR HAS BEEN SET ASIDE AND THE MATTER IN ISSUE IS REMAN DED TO HIS FILE FOR PASSING THE ORDER AFRESH, THERE IS NO QUES TION OF TREATING THE ORDER OF HIS PREDECESSOR TO BE AN ORDE R IN ACCORDANCE WITH LAW. THEREFORE, THE LEARNED CIT ( APPEALS) SHOULD NOT HAVE QUOTED SOME PORTION OF THE ORDER OF HIS PREDECESSOR IN THE IMPUGNED ORDER AND SHOULD NOT HA VE ALSO HELD THAT THE VIEW TAKEN BY HIS PREDECESSOR WAS COR RECT WHEN THE VIEW OF HIS PREDECESSOR WAS ALREADY SET ASIDE. IT IS A CLEAR CASE OF SHOWING DISRESPECT TO THE ORDER OF TH E TRIBUNAL. THEREFORE, CONTEMPT PROCEEDINGS COULD HAVE BEEN INI TIATED AGAINST THE LEARNED CIT (APPEALS) FOR BLATANTLY DIS OBEYING THE ORDER OF THE TRIBUNAL. THE HON'BLE MADHYA PRADESH HIGH COURT IN THE CASE OF AGRAWAL WAREHOUSING & LEASING LTD. VS. CIT, 257 ITR 235 HELD THAT THE CIT (APPEALS) CANNOT REFUSE TO FOLLOW THE ORDER OF THE APPELLATE TRIBUNAL. THE H ON'BLE HIGH COURT HELD AS UNDER : 13 HELD, THAT THE COMMISSIONER OF INCOME-TAX (APPEALS) NOT ONLY COMMITTED JUDICIAL IMPROPRIETY B UT ALSO ERRED IN LAW IN REFUSING TO FOLLOW THE ORDER OF THE APPELLATE TRIBUNAL. THE MEMBERS OF THE TRIBUNAL WH O DECIDED THE APPEAL UPHOLDING THE VIEW TAKEN BY THE COMMISSIONER INCOME-TAX (APPEALS) ALSO DID NOT OBSE RVE DUE PROCEDURE. 10. THE LEARNED CIT (APPEALS) FAILED TO TAKE NOTE OF THE FACT THAT HE IS QUASI-JUDICIAL AUTHORITY UNDER THE INCOME TAX ACT AND IS SUBORDINATE IN JUDICIAL HIERARCHY TO THE TRIBUNAL. THE ORDERS PASSED BY THE TRIBUNAL ARE BINDING ON AL L THE REVENUE AUTHORITIES FUNCTIONING UNDER THE JURISDICT ION OF THE TRIBUNAL. THE PRINCIPLES OF JUDICIAL DISCIPLINE R EQUIRE THAT THE ORDERS OF THE HIGHER APPELLATE AUTHORITIES SHOU LD BE FOLLOWED UNRESERVEDLY BY THE SUBORDINATE AUTHORITIE S. THE HON'BLE SUPREME COURT IN THE CASE OF UNION OF INDI A VS. KAMLAKSHI FINANCE CORPORATION, AIR 1992 SC 711 HELD THAT JUDICIAL DISCIPLINE REQUIRES THAT THE ORDERS OF TH E HIGHER APPELLATE AUTHORITIES SHOULD BE FOLLOWED . 11. CONSIDERING THE FACTS OF THE CASE IN THE LIGHT OF THE FINDINGS OF THE LEARNED CIT (APPEALS) IN THE IMPUGN ED ORDER, WE ARE OF THE VIEW THAT THE ORDER OF THE LEARNED CI T (APPEALS) CANNOT BE SUSTAINED IN LAW AND IS PASSED BY THE LEA RNED CIT (APPEALS) CLEARLY IN DEFIANCE OF THE ORDER OF THE T RIBUNAL. SINCE IT IS A FIRST MATTER REPORTED TO US DURING TH E COURSE OF ARGUMENTS BY THE LEARNED D.R FOR THE REVENUE THAT T HE ORDER OF THE LEARNED CIT (APPEALS) SHOWS COMPLETE DEFIANC E OF THE ORDER OF THE TRIBUNAL, THEREFORE, WE DO NOT PROPOSE AT THE 14 STAGE TO INITIATE CONTEMPT PROCEEDINGS AGAINST THE LEARNED CIT (APPEALS), HOWEVER, WE WARN HIM TO BE CAREFUL I N FUTURE IN FOLLOWING THE ORDER OF THE TRIBUNAL IN ACCORDANC E WITH LAW AND SHOULD NOT SHOW ANY DEFIANCE TO THE ORDER OF TH E TRIBUNAL. IN THIS VIEW OF THE MATTER, WE SET ASID E THE IMPUGNED ORDER OF THE LEARNED CIT (APPEALS), CHANDI GARH AND RESTORE THE MATTER IN ISSUE TO HIS FILE WITH DIRECT ION TO REDECIDE THE APPEAL OF THE ASSESSEE STRICTLY IN ACC ORDANCE WITH LAW AND IN FOLLOWING THE EARLIER ORDER OF THE TRIBUNAL DATED 23.11.2011. THE LEARNED CIT (APPEALS) SHAL L GIVE REASONABLE SUFFICIENT OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AND SHALL DECIDE THE APPEAL OF THE ASSESSE E WITHIN TWO MONTHS FROM THE RECEIPT OF THIS ORDER. 12. IN THE RESULT, DEPARTMENTAL APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 16 TH DAY OF JUNE, 2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 16 TH JUNE, 2015 *RATI* COPY TO: THE APPELLANT/THE RESPONDENT/THE CIT(A)/TH E CIT/THE DR. ASSISTANT REGISTRAR, ITAT, CHANDIGARH 15