M/s. Gaytri Infrastructure Ltd., Gandhinagar V. The ACIT., (OSD),GNR Circle, Gandhinagar

MA 163/AHD/2009

• Counselvise Citation: [2011] 123 COUNSELVISE.COM (IT) 7118 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 4 month(s) 24 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-10-2011
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2001-2002
• Appeal Filed On: 13-05-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S A BOHRA
• Assessee Lawyers: S N SOPARKAR
• Section: 80IB

Judgement Text

- 1 - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B AHMEDABAD BEFORE S/SHRI D.K. TYAGI, JM AND A.K. GARODIA, A.M . ASSTT. CIT,(OSD), GANDHINAGAR. GAYATRI INFRASTRUCTURE LTD., ASHOK PLAZA, SABARMATI GNR HIGHWAY, VILLAGE MOTERA, GANDHINAGAR APPELLANT VS. RESPONDENT ASSESSEE BY :- SHRI S. N. SOPARKAR, SR.ADVOCATE REVENUE BY:- SHRI S. A. BOHRA, SR.DR DATE OF HEARING 23/9/2011 DATE OF PRONOUNCEMENT -7/10/2011 O R D E R PER D.K. TYAGI, JUDICIAL MEMBER . THIS MISCELLANEOUS APPLICATION HAS BEEN FILED BY T HE ASSESSEE AGAINST THE ORDER DTD.05.12.2008 OF TRIBUNAL IN ITA NO.303/AHD/2005 FOR ASST. YEAR 2001-02. 2. THIS MISC. APPLICATION HAS BEEN FILED BY THE ASS ESSEE FOR SETTING ASIDE THE ORDER DATED 05/12/2008 PASSED BY THE TRIB UNAL BY REVERSING THE ORDER OF THE LD. CIT(A) AND REMITTING THE MATTER BA CK TO THE FILE OF AO M.A. NO.163/AHD/2009 IN ITA NO.303/AHD/2005 ASST. YEAR 2001-02 M.A. NO.163/AHD/2009 IN ITA NO.303/AHD/2005 ASST. YEAR 2001-02 2 (PAGE 6 PARA 5) WITH THE DIRECTION TO CONSIDER THE PRINCIPLES LAID DOWN BY THE HONBLE APEX COURT IN THE CASE OF FAQUR CHAND G ULATI AS WELL THE CASE LAW OF THIS TRIBUNAL IN THE CASE OF SHAKTI COR PORATION, BARODA AND TO DECIDE THE ISSUE IN THE LIGHT OF FACTS AND CIRCUMST ANCES OF THE CASE. IT HAS BEEN SUBMITTED THAT IN THE SAID ORDER OF THE TRIBUN AL THERE IS AN ERROR APPARENT FROM THE RECORD. 3. THE TRIBUNAL WHILE DISPOSING OF THE APPEAL ON PA GE 2 PARA 2 HAS OBSERVED THAT AT THE OUTSET, THE LD. COUNSEL FOR T HE ASSESSEE, SMT. URVASHI SHODHAN STATED THAT THE ISSUE IS SQUARELY C OVERED BY THE DECISION OF THIS TRIBUNAL IN THE CASE OF M/S RADHE DEVELOPER S & OTHERS IN ITA NO.2481/AHD/2006 DATED 29/06/2007. SHE REFERRED TO THE FOLLOWING PARAS OF THE TRIBUNAL ORDER WHEREIN THE TRIBUNAL HAS CONS IDERED THE ISSUE IN GREAT DETAIL AND ALLOWED ELIGIBILITY U/S 80IB (10) BY FOLLOWING OBSERVATIONS : XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX FURTHER SHE REFERRED TO THE VARIOUS PARAS OF THE TR IBUNALS ORDER AND STATED THAT THE TRIBUNAL HAS CONSIDERED VARIOUS CASE LAWS AND PERTINENT AS OBSERVATIONS READ AS UNDER : XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXX XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX XXXXXXXX M.A. NO.163/AHD/2009 IN ITA NO.303/AHD/2005 ASST. YEAR 2001-02 3 IN VIEW OF THE ABOVE SHE CONTENDED THAT THE ISSUE I S SQUARELY COVERED IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. 4. THE ASSESSEE SUBMITS THAT THE TRIBUNAL HAS OVERL OOKED TAKING INTO COGNIZANCE THE ORDER OF THE TRIBUNAL PLACED BY THE AR OF THE APPELLANT BEFORE THE HONBLE BENCH IN APPELLANTS OWN CASE FO R ASST. YEAR 2002-03 & 2003-04 BY THE HONBLE A BENCH IN ITA NO.1937 & 1338/AHD/2006 DATED 09/08/2007 DISMISSING THE APPEALS FILED BY TH E REVENUE IN RESPECT OF THE CLAIM OF DEDUCTION U/S 80IB (10) ALLOWED BY LD. CIT(A) FOR THE MENTIONED SUBSEQUENT YEARS FOLLOWING APPELLATE ORDE R FOR ASST. YEAR 2001-02 IN RESPECT OF THE SAME HOUSING PROJECT WHIC H THE APPELLANT IS ENGAGED IN DEVELOPING AND BUILDING (ENCLOSED ANNEXU RE-A). 5. THE ASSESSEE SUBMITS THAT IN VIEW OF THE FACT TH AT WHEN ORDER OF AN EARLIER CO-ORDINATE BENCH IN ASSESSEES OWN CASE DI SMISSING THE APPEALS FILED BY THE REVENUE FOR THE SUBSEQUENT ASSESSMENT YEARS ON THE SAME SET OF FACTS BY FOLLOWING THE APPELLATE ORDER OF THE YE AR UNDER APPEAL FOR THE SAME PROJECT IS AVAILABLE THAN THE SUBSEQUENT BENCH CANNOT DEFER FROM THE DECISION OF THE EARLIER BENCH OR IT IS REQUIRED TO REFER THE MATTER TO THE LARGER BENCH (RELIANCE PLACED ON 253 ITR 749 GUJAR AT HIGH COURT). 6. THE ASSESSEE THEREFORE, SUBMITS THAT IN THE LARG ER INTEREST OF JUSTICE THE HONBLE TRIBUNAL BE PLEASED TO ACCEPT THE PRAYE R OF THE ASSESSEE AND M.A. NO.163/AHD/2009 IN ITA NO.303/AHD/2005 ASST. YEAR 2001-02 4 MODIFY THE ORDER PASSED BY DISMISSING THE APPEAL FI LED BY THE REVENUE SO AS TO FOLLOW JUDICIAL PROPRIETY AS LAID DOWN BY THE JURISDICTIONAL HIGH COURT AND GRANT JUSTICE TO THE ASSESSEE. 7. THE LD. DR ON THE OTHER HAND SUPPORTED THE ORDER OF THE TRIBUNAL AND SUBMITTED THAT THERE IS NO MISTAKE APPARENT FRO M RECORD IN THE ORDER OF THE TRIBUNAL AND THEREFORE, NO INTERFERENCE IS C ALLED FOR. THE MISCELLANEOUS APPLICATION FILED BY THE ASSESSEE BE REJECTED. 8. WE HAVE CAREFULLY CONSIDERED THE RIVAL SUBMISSIO NS AND GONE THROUGH THE ORDER OF THE TRIBUNAL. WE FIND THAT THE TRIBUNAL HAS SET ASIDE THE APPEAL IN ITA NO.303/AHD/2005 OF REVENUE FOR AS ST. YEAR 2001-02 VIDE ITS ORDER DATED 05/12/2008 WITH THE FOLLOWING OBSERVATIONS : 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND GONE TH ROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE. WE HAVE ALSO PERUSED THE CASE LAWS CITED BY BOTH THE SIDES AND ALSO GONE THROUGH THE ASSESSM ENT ORDER AS WELL AS THE ORDER OF CIT(A). IT IS NOTICED FROM THE ORDERS OF THE LOWER AUTHORITIES THAT THEY HAVE NOT GONE INTO THE BUILDER AGREEMENT OR JOINT VENTURE AGREEMENTS. THEY HAVE NOT ASCERTAINED WHETHER THE A SSESSEE IS A DEVELOPER OR A CONTRACTOR. IN THE ABSENCE OF THESE FINDINGS, WE ARE OF THE VIEW THAT THE ISSUE NEEDS RE-VERIFICATION IN THE LI GHT OF HONBLE APEX COURT JUDGMENT IN THE CASE OF FAQIR CHAND GULATI (S UPRA). SIMILARLY, THE AHMEDABAD TRIBUNAL IN ANOTHER CASES HAS ALSO LAID D OWN CERTAIN PRINCIPLES IN THE LIGHT OF HONBLE APEX COURT JUDGM ENT IN THE CASE OF FAQIR CHAND GULATI (SUPRA) AND AO IS ALSO REQUESTED TO CONSIDER THE CASE LAW OF THIS TRIBUNAL IN THE CASE OF ITO & ORS. VS. SHAKTI CORPORATION, BARODA AND ORS. IN ITA NO.1503/AHD/200 8 DATED 07/11/2008. THE TRIBUNAL IN THESE CASES HAS HELD AS UNDER :- 16 THE FACTS INVOLVED IN THE CASE OF THE ASSESSEE ARE SIMILAR TO THE FACTS IN THE CASE OF RADHE DEVELOPERS (SUPRA) AND A CCORDINGLY WE ARE OF THE VIEW THAT THE ASSESSEE HAS ACQUIRED THE DOMI NANT OVER THE LAND AND HAS DEVELOPED THE HOUSING PROJECT BY INCURRING ALL THE EXPENSES AND TAKING ALL THE RISKS INVOLVED THEREIN. WE MAY M ENTION HERE THAT, IN M.A. NO.163/AHD/2009 IN ITA NO.303/AHD/2005 ASST. YEAR 2001-02 5 OUR OPINION, THE DECISION IN THE CASE OF RADHE DEVE LOPERS (SUPRA) WILL NOT APPLY IN A CASE WHERE THE ASSESSEE HAS ENTERED INTO THE AGREEMENT FOR A FIXED REMUNERATION MERELY AS A CONTRACTOR TO CONSTRUCT OR DEVELOP THE HOUSING PROJECT ON BEHALF OF THE LANDOWNER. THE AGREEMENT ENTERED INTO IN THAT CASE WILL NOT ENTITLE THE DEVELOPER TO HAVE THE DOMINANT CONTROL OVER THE PROJECT AND ALL THE RISKS INVOLVED THEREIN WILL VEST WITH THE LANDOWNER ONLY. THE INTEREST OF THE DEVELOPER W ILL BE RESTRICTED ONLY FOR THE FIXED REMUNERATION FOR WHICH HE WOULD BE RENDERING THE SERVICES. THE DECISION IN THE CASE OF RADHE DEVELOP ERS (SUPRA) HAS NOT DEALT WITH SUCH SITUATION. THE PROPOSITION OF LAW L AID DOWN IN THE CASE OF RADHE DEVELOPERS CANNOT BE APPLIED UNIVERSALLY W ITHOUT LOOKING INTO THE DEVELOPMENT AGREEMENT ENTERED INTO BY THE DEVELOPER ALONG WITH THE LANDOWNER. IN THE CASE OF SHAKTI CORPORATI ON SINCE THE ASSESSEE HAS FILED COPY OF THE DEVELOPMENT AGREEMEN T AND CRUX OF THE AGREEMENT IS THAT THE ASSESSEE HAS PURCHASED THE LA ND AND HAS DEVELOPED THE HOUSING PROJECT AT ITS OWN, THEREFORE , WE ARE OF THE VIEW THAT THE ASSESSEE WILL BE ENTITLED FOR THE DEDUCTIO N U/S 80IB(10). THE DECISION OF THE HON'BLE SUPREME COURT IN THE CASE O F FAQIR CHAND GULATI (SUPRA) WILL NOT ASSIST THE REVENUE, AS THE AGREEMENT IS NOT SHARING OF THE CONSTRUCTED AREA. IN OTHER CASES THE COPY OF AGREEMENT SINCE HAS NOT BEEN SUBMITTED BEFORE US, IF SUBMITTE D , THE TERMS AND CONDITIONS OF THE AGREEMENT WERE NOT SPECIFICALLY A RGUED BEFORE AND PLACED BEFORE US, WE THEREFORE, IN THE INTEREST OF JUSTICE AND FAIR PLAY TO BOTH THE PARTIES SET ASIDE THE ORDER OF THE CIT( A) AND RESTORE ALL OTHER APPEALS TO THE FILE OF THE AO WITH THE DIRECT ION THAT THE AO SHALL LOOK INTO THE AGREEMENT ENTERED INTO BY EACH OF THE ASSESSEES WITH THE LANDOWNER AND DECIDE WHETHER THE ASSESSEE HAS IN FA CT PURCHASED THE LAND FOR A FIXED CONSIDERATION FROM THE LANDOWNER A ND HAS DEVELOPED THE HOUSING PROJECT AT ITS OWN COST AND RISKS INVOL VED IN THE PROJECT. IN CASE THE AO FINDS THAT PRACTICALLY THE LAND HAS BEE N BOUGHT BY THE DEVELOPER AND DEVELOPER HAS ALL DOMINANT CONTROL OV ER THE PROJECT AND HAS DEVELOPED THE LAND AT HIS OWN COST AND RISKS, T HE AO SHOULD ALLOW THE DEDUCTION TO THE ASSESSEE U/S 80IB(10). IN CASE THE AO FINDS THAT THE DEVELOPER HAS ACTED ON BEHALF OF THE LANDOWNER AND HAS GOT THE FIXED CONSIDERATION FROM THE LANDOWNER FOR THE DEVE LOPMENT OF THE HOUSING PROJECTS, THE ASSESSEE SHOULD NOT BE ALLOWE D DEDUCTION U/S 80IB(10) TO THE ASSESSEE. 5. IN VIEW OF THE ABOVE FACTS AND CIRCUMSTANCES, WE SET ASIDE THIS APPEAL TO THE FILE OF THE AO WITH A DIRECTION THAT HE WILL CONSIDER THE PRINCIPLES LAID DOWN BY THE HONBLE APEX COURT IN T HE CASE OF FAQIR CHAND GULATI (SUPRA) AS WELL AS THE CASE LAW OF THI S TRIBUNAL IN THE CASE OF SHAKTI CORPORATION, BARODA (SUPRA) AND DECIDE TH IS ISSUE IN THE LIGHTS OF FACTS AND CIRCUMSTANCES OF THE CASE. IN THE APPEAL IN QUESTION THE TRIBUNAL FOUND THAT T HE LOWER AUTHORITIES HAD NOT GONE INTO THE BUILDER AGREEMENT OR JOINT VENTUR E AGREEMENTS AND HAD M.A. NO.163/AHD/2009 IN ITA NO.303/AHD/2005 ASST. YEAR 2001-02 6 NOT ASCERTAINED WHETHER THE ASSESSEE IS A DEVELOPER OR A CONTRACTOR. IN ABSENCE OF THESE FINDINGS THE TRIBUNAL WAS OF THE V IEW THAT THE ISSUE NEEDS RE-VERIFICATION IN THE LIGHT OF HONBLE APEX COURT JUDGMENT IN THE CASE OF FAQIR CHAND GULATI (SUPRA) AND ACCORDINGLY SET ASIDE THE APPEAL TO THE FILE OF AO WITH A DIRECTION THAT HE WOULD CONSI DER THE PRINCIPLES LAID DOWN BY THE HONBLE APEX COURT IN THE CASE OF FAQIR CHAND GULATI (SUPRA) AS WELL AS THE CASE LAW OF THIS TRIBUNAL IN THE CASE OF SHAKTI CORPORATION, BARODA AND DECIDE THE ISSUE IN THE LIG HTS OF FACTS AND CIRCUMSTANCES OF THE CASE. THESE TWO CASES WERE NOT CONSIDERED BY THE TRIBUNAL IN ASSESSEES OWN CASE FOR EARLIER YEARS W HILE DISMISSING THE APPEAL OF THE REVENUE. SINCE THE ISSUE WAS RESTORED BACK TO THE FILE OF THE AO IN THE LIGHT OF THE DECISION OF HONBLE APEX COU RT IN THE CASE OF FAQIR CHAND GULATI (SUPRA), THE RATIO AS LAID DOWN BY THE HONBLE JURISDICTIONAL HIGH COURT IS NOT APPLICABLE TO THE FACTS OF THIS C ASE. IN VIEW OF THIS, THE PRAYER OF THE ASSESSEE TO MODIFY THE EARLIER ORDER BY DISMISSING THE APPEAL OF THE REVENUE CANNOT BE ADHERED TO AS IT WILL AMOU NT TO REVIEW OF OUR EARLIER ORDER. THE LAW IS WELL SETTLED THAT WE DO N OT HAVE SUCH POWER. THEREFORE, THE MISCELLANEOUS APPLICATION FILED BY T HE ASSESSEE IS REJECTED. M.A. NO.163/AHD/2009 IN ITA NO.303/AHD/2005 ASST. YEAR 2001-02 7 9. IN THE RESULT, THE MISCELLANEOUS APPLICATION FIL ED BY THE ASSESSEE IS REJECTED. ORDER WAS PRONOUNCED IN OPEN COURT ON 7/10/2011. SD/- SD/- (A. K. GARODIA) (D.K. TYAGI) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD, MAHATA/- COPY OF THE ORDER FORWARDED TO :- 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD 1.DATE OF DICTATION 23/9/11. 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING MEMBER 26/9/11. /OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT.. 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..