M/s. Pratham Developers, Baroda V. The Pr. CIT-1, Baroda

MA 241/AHD/2019

• Counselvise Citation: [2021] 104 COUNSELVISE.COM (IT) 8624 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 3 month(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 14-11-2021
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 13-08-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S.S. SHUKLA
• Keywords: Revision of order; Set aside
• Section: 143(3); 195; 143(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “B” BENCH (Conducted Through Virtual Court) Before: Shri Mahavir Prasad, Judicial Member And Shri Amarjit Singh, Accountant Member M/s. Pratha m Dev elopers ‘PRATHAM’, Groun d Floor, Mak rand Desai Road, Go tri, Vadodara PAN: AAHFP2 699D (Appellant) Vs The Principal CIT-I, Aaykar Bhavan , Race Course Ro ad, Vadodara-3900 07 (Resp ondent) Revenue by : Shri S . S. Shukla, Sr. D. R. Asses see b y : Shri Milin M ehta, A. R. Date of hearing : 01-10 -2021 Date of pronouncement : 15-11 -2021 आदेश/ORDER PER : AMARJIT SINGH, ACCOUNTANT MEMBER:- Vide the Miscellaneous Application 241/Ahd/2019, the assessee has pointed out that while adjudicating its appeal by the ITAT vide ITA 1533/Ahd/2015 dated 30 th April, 2019, the grounds of appeal of the assessee from serial nos. 5 to 10 were not considered. 2. Heard both the sides and perused the material on record. The assessee has filed appeal vide ITA 1533/Ahd/2015 against the order of Pr. CIT made M.A. No. 241/Ahd/2019 (In ITA No. 1533/Ahd/2015) Assessment Year 2010-11 M.A. No. 241/Ahd/2019 (In I.T.A No. 1533/Ahd/2019) A.Y.2010-11 Page No M/s. Pratham Developers vs. Pr. CIT 2 u/s. 263 of the act on 27 th March, 2015. The grounds of appeals were mainly directed against the observation of the ld. Pr. CIT made in the order u/s. 263. Since all the grounds of appeal against the order passed u/s 263 of the act were identical to the issue of set aside of the assessment made u/s. 143(3), therefore, the same were adjudicated by common finding elaborated at para 16 of the ITAT order dated 30 th April, 2019. In the order the ITAT has specifically mentioned that ld. Pr. CIT has held that the facts of the case of the assessee were identical to the facts of the case of Moon Star Developers (2014) 367 ITR 62 (Guj) on the issue of deduction u/s. 80IB(10) on un-realized FSI, therefore, the order u/s. 143(3) was set aside to be framed afresh. In this regard, the ITAT has mentioned in its finding that the assessee has submitted the detail in response to the notice u/s. 263 placed at page no. 67 to 196 of the paper book furnished during the course of appellate proceedings before the ITAT and this specific information pertaining to sale of un-utilized for FSI area was not furnished before the Assessing Officer during the course of assessment proceedings and the same was required to be examined by the Assessing Officer. The Pr. CIT has only set aside the assessment for framing fresh assessment after examination of the materials and judicial findings, therefore, we do not find any error apparent from record at this stage as pointed out by the assessee in its Miscellaneous Application. Therefore, Miscellaneous Application of the assessee is rejected. The relevant part of the order of ITAT is reproduced as under:- “16. We have heard the rival contentions and perused the material on record. The assessment u/s. 143(3) of the act was completed on 04-02-2012. The assessing officer has disallowed the claim of deduction u/s. 80IB(10) of the act to the amount of Rs. 77568761/- on account of the following reasons:- (i) The assessee was not the sole owner of the land on which the project was constructed. (ii) In respect of Prathma Vistas Project, the approval of the Housing Project consisting of 158 residential units of which the built up area of 55 residential units exceeds the prescribed limit of 1500 sq. fts. M.A. No. 241/Ahd/2019 (In I.T.A No. 1533/Ahd/2019) A.Y.2010-11 Page No M/s. Pratham Developers vs. Pr. CIT 3 (iii) Exclusion of other income to the amount of Rs. 17,13,580/- for the claim of 80IB(10) deduction We have also considered the number of judicial pronouncements referred by the ld. counsel in the index of case law, however he has mainly made reference to the facts of this case to the following two decisions of the Hon’ble Jurisdictional High of Gujarat on the issue of profitability on sale of un-utilized FSI (i) CIT vs. Moon Star Developes (2014) 367 ITR 62 (Guj) (ii) CIT vs. Shreenath Infrastructure (2014) Taxmann 461 (Gu) In the case of the Moon Star Developers wherein held that the marginal under-utilization of FSI certainly cannot be a ground for rejecting the claim under section 80IB(10) of the act. In the subsequent decision of the Hon’ble Gujarat in the case of CIT vs. Shreenath Infrastructure after referring the aforesaid earlier decision it is mentioned that even if there has been considerable under-utilization if the assessee can point out any special ground why the FSI could not be fully utilized such as height restriction because of special zone, passing of high tension electric wires overhead or any such similar grounds to justify underutilization, the case may stand on different footing. On perusal of the assessment order, it is noticed that the assessing officer has not examined the issue of profitability relating to sale of unutilized FSI in respect of which no construction was undertaken. We have also gone through the paper book furnished by the assessee containing the details of information furnished before the assessing officer and CIT(A). It is observed that the assessing officer has issued notice u/s. 143(2) of the act on 2-1-2002, reply by the assessee to the notice vide letter dated 18-1-2012, further submission to the assessing officer dated 20-03-2012, notice of the assessing officer dated 13-2-2012, reply to the notice dated 20-03- 2012. However we observe that assessing officer has not examined the matter pertaining to the profit derived by the assessee from sale of unutilized FSI. Therefore, the ld. PCIT-1 Vadodara has issued a notice u/s. 263(1) of the act on 22-01-2015 in respect of taxability of profit on sale of un- utilized FSI in respect of taxability of profit on sale of un-utilized FSI in respect of which no construction was undertaken. After considering the submission of the assessee, the Ld. PCIT has held that the assessing officer not re-examined the issue while finalizing the assessment relating to profit in respect of un-utilized FSI. The ld. PCIT has held that the facts of the case of the assessee were identical to the facts of the case of Moon Star Developers, therefore, the assessee was not entitled for deduction u/s. 80IB(10) on un-utilized FSI, therefore, the order u/s. 143(3) was set aside to be framed afresh. We find that assessee has submitted detail in response to notice u/s. 263 placed at page no. 67 to 195 of the paper book furnished during the course of appellate proceedings before us, but we observe that these specific information pertaining to unutilized sale for FSI area was not furnished before the assessing officer during the course of assessment proceedings. Therefore, we are of the view that these specific details were required to be examined by the assessing officer and the ld. PCIT has rightly held in his order u/s. 263 that matter was set aside to the assessing officer to provide opportunity to the assessee to prove its contentions. After considering the aforesaid fact and legal finding, we observe that the assessing officer has not examined the issue of under-utilization of the FSI in the case of the assessee according to the directions of the Hon’ble High Court of Gujarat laid down in the above cited judicial pronouncements, therefore, the issue to be examined by the assessing officer according to the directions of Hon’ble High Court in the referred cases. In the light of the above facts and circumstances, we observe that the impugned issue was not examined while finalizing the assessment therefore the order of the assessing officer was erroneous as well as prejudicial to the interest of the revenue. We therefore uphold the order of the ld. Pr. CIT. Therefore, all the grounds of appeal from 1 to 10 are dismissed.” M.A. No. 241/Ahd/2019 (In I.T.A No. 1533/Ahd/2019) A.Y.2010-11 Page No M/s. Pratham Developers vs. Pr. CIT 4 Looking to the above facts and findings of the ITAT on the issue as supra, we do not find any apparent mistake, therefore, the Miscellaneous Application is rejected. 3. In the result, the Miscellaneous Application filed by the assessee is dismissed. Order pronounced in the open court on 15-11-2021 Sd/- Sd/- (MAHAVIR PRASAD) (AMARJIT SINGH) JUDICIAL MEMBER ACCOUNTANT MEMBER Ahmedabad : Dated 15/11/2021 आदेश क त ल प अ े षत / Copy of Order Forwarded to:- 1. Assessee 2. Revenue 3. Concerned CIT 4. CIT (A) 5. DR, ITAT, Ahmedabad 6. Guard file. By order/ आदेश से, उप/सहायक पंजीकार आयकर अपील य अ धकरण, अहमदाबाद