THE COMMISSIONER OF INCOME TAX V. MR C GOPALAN

ITA/235/2010

AI Insights

This case involves an appeal by the Commissioner of Income-tax and the Income-Tax Officer against Sri C. Gopalan concerning the assessment year 2005-06. The primary issue was whether the assessee was entitled to an exemption from payment of income-tax under a specific provision of the Income Tax Act, 1961, despite the constructed area of some residential units exceeding the prescribed limit of 1,500 sq ft. The ITAT Bangalore had previously upheld the Appellate Commissioner's decision, which the appellants sought to challenge in the High Court. The court examined the circumstances under which the excess construction occurred and the applicability of the law as it stood during the relevant assessment year.

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 744935 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 29-02-2012
• Assessment Year: misc
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Assessee Lawyers: K V ARAVIND
• Keywords: Assessment Year 2005-06; Built-up area; Exemption from payment of income tax; Income tax appeal
• Section: 260-A

Judgement Text

"S IN THE HIGH COURT OF KARNATAKA AT BANGALORE DATED THIS THE 29w” DAY OF FEBRUARY, 2012 PRESENT THE HON’BLE MR. JUSTICE N KUMAR AND THE HON’BLE MR. JUSTICE RAVI MALIMATH INCOME-TAX APPEAL NO.235 OF 2010 BETWEEN: 1. The Commissioner of Income-tax C.R.Buildlng, Queens Road, Bangalore. 2. The Income-Tax Officer, Ward—1(4), Bangalore. .Appellants (By Shri K.V. Aravind, Advocate) AND: Sri C. Gopalan No.5, Richmond Road Bangalore - 560 025 .Respondent This ITA is filed under Section 260-A of I.T. Act, 1961 arising out of order dated 10.02.2010 passed In ITA No.962/Bang/2009, for the Assessment Year 2005-06 praying to (I) formulate the substantial questions of law stated therein; (ii) allow the appeal and set aside the orders passed by the flAT Bangalore in ITA No.962/Bang/2009 dated 10.02.2010 conforming the order of the Appellate Commissioner and confirm the order passed by the Income Tax Officer, Ward-1(4), Bangalore, and etc. i. II 3 D t - p t P ( S V - 3 1 j I ‘ P 1 a -t 1) 3 P t P - 4 4 C V up P - I.. ‘p - ‘p -p -.7 ‘p P P .7 - m a S - 3 • t 1 C ‘-p 3 0; 7 ‘p — 3 P A ‘-p It 3 C P 0 C. t 3 ‘p 7 P m a ‘C — 1? I P -r a; w C I a •1 I 4, - S I .3 x D t P ‘1 •1 3 a — 4 ) I E. I — I 1’ ( ‘a. t 3 t 0) C a. C C 1) a 1 1 414 a 7 0 I ) 0 I 0 7 - a. 0 a 331 C, . D t 3 3 3 a 41 ) t 0 0) 3 0 t .t 1 x C. $ a. 0 “S t - - 01 C, C, D 33 ‘I cO C 3 3 a; I 3 m I 7 4. I, t 3. C D 7 C 1,1 4 t I I 1 N. I ) C. I. t C. S t .3 3 .3 7) ; C, eq C, t I ) 7 31 1) 3 I — 30 -7 ‘p 0 C C) ‘3 D •1 1’ t . D “3 ‘p a - o a t ‘p ) 1% r 3 . C 7 D - C 0J S Ce c p t Li 3 C V 3 C t( 3 ) P1 V - t 0 C C 3 ‘C m ‘p I ‘I “ m 3 -.3 3 1 1) 1 •1 ‘p - ‘p - (I -7 I ?W7 -1’ — 7 • J t — 3 0 D ( V t 3 3 ‘3 D C. 3 ) 7 .3 £ .r - 3- ‘5 I 3 iC te V a m 1- V .) (_ (IC 1 a. m ‘p 7 C 0 I r D ecE 3 3 CD U) D at prescribed nder law. Each of the recidential unitnlat measures less than 1,5G3 sq ft of built- ip area It !5 t:nl? in eight s- r al nt tict 0) vh e ii ntrarc o idd to the terrace, the assessee has sold the 5aid ter rate portion to the )%V ers of the reside ‘itia flats. U ido btedly the trace ortrn ca lot be ta r lit s ra’o fo cacul ti g ie built-up area and Las to be excluded. It appears that along with e erjcccoiewals ontrutedw els sld othei. Ever the const uct on of the val’ would no add t thc b It p area After sale the purchaser of the flat appears to have put 0€ otruct •. f ia prtn staker 10 convdratioq. it exceeds the area of 1 500 sq ft the limit orescnbed under ia%J It s ‘r that grouna fle Assessing Officer e . ¶ t vihile ir”erretiqq ‘h’c -‘ro” ,‘-n: what ; tzj I.e iarj ‘r rn’n I is the bJe’t :. it ‘1 •i’ n tP.ic tj’c3. ‘i .sas i.” r “G’kfrC) C V i rio v 0 ’flQ ‘ E / — ‘ t A .4,,, • ‘ • ‘ ‘ ‘S • ,fl• ,,r’ ,,,i. — ‘• ,S_.,, .‘,r a: •“ ‘ 3? I • a f % I’ ,i•_ ha • h ( 9 !Nsr.1sPG OL.Si’9 p.cie.x- .5a 11 uwer t’e ‘?:us.g C ;s n.,raed L’, I 1 Cc3’ a t?•”t, I’’vre .‘ :ots t e 3PCjs..t!C C s.t;eet CC? tPP -“J.r’cn, tnar P,e ‘:.Jert3&.3 3 ae cn—iee: :eba’ ‘r’err ar t”e ‘7csifl9 or-) ‘ C’c rtei thc 98 tre- n c e ‘ a whi, , n’nim a e acre I nt ‘dentc ci t 4 L1 P753 quaref re.iJt t s tnted. el. or ‘1uni ci r thousan 1 a c i qdre SQ fetatmieraa a Tb, 6 ,nert’e was prev:aed to ‘jr th StoCk houses t r !ower an1 “vidie income groups. !‘eeping I” ‘ew tt’e #act chat here ‘s stiq a huqe crn’rage 0 houses, nw tima lir. ‘br 3btairl:ng apprc.-aI rreni tflC “ca a’tre’,ry cee.i cAte’dtC rrfl ,i 3 .WO5 a ‘.Z. 2W7 ei’e’, ‘‘e ,,ri ‘ beer in-.aj e for C no hou’q - e ievalopr nd cx on; r ence 7 r I -c 4.2G letc oec-t. theh’.. oprnea • ‘‘t I •r Vt ..z . t. 1”..— .. ,.a • •‘—• :,. e..Ip; r -t : ‘—e :etc.,! ..‘r:•’r.r —. :- r’::rj-- ‘t - ‘t. .‘r.rfl ‘ — ‘.•: ,‘ -— J.. .‘ .,-p..’’ t’.. .. .v • ttp • — • •• V L, •_ . pI._ • 1 . tg • ——‘ ‘ .c -‘ •. J’ .._ . t —t— t ‘ C 3 tat L’ to c otnchoJs7 v”ereve ‘ess rhe ncresc .v sc t 1 ir’ a or t& Pb 00* e ‘ me ca-oe t v-c ie ecrme-’t ‘.r’ :aas. te’a rn’a•is CS t t ‘J’Jf.-jt JE saie cpouLj nFrjrrrl te the project p’a” approved h: the os ccitt it C: d •° th t7 guGt t ftrce. Alga the area t init or the plot has to oe conctrueo ttrcttrc t tie e f 3it 07 lute hius’ng project is constructed and rct wit!’ referer’ce to tseffai t i rico ebvth iand e 1 onnt autnoritt. Fanner with a S rr d’ airrg acre an•1 a’sc C 75 Li it) prcjcct t3 ‘Tj ‘en to erccurage the redev!opmer7t 5 U ‘‘otI • i’riro ci e me tine ,:rrl.t t: omclerkn Qi re ‘anh -- ‘•‘t a w’tn e sJ,e.ie P-Aqw1 —, a — r - t’c’cr 1 ”n r ac e’cpne: ot -s’,t rg ‘a”a”g “ - :coe a’ in n.r’fa, y t”e Su’ 1 “ ‘1” T zi. •_J3t_. t. .3 •‘• .. Li • I 7 y • )jr. ‘C “ :1 ii U’ :1 it t. ,..... fl’L, I d t ‘)C h P I ) 3. II J I ert 1 ‘ee c t 290C 54. t t. ic a I , 1t t 0, ‘ I, IL C) e’ t u1 / ‘P I 1. , t 4 I . . a. 1%. LO same Is arplicabie only orospectively The present assessn er t year s 2005-2006 11. In a construction of severa i. Ms. 1 i ev ur its, wh ch arc on the top floor, Jo not conform stnctly to thic reqfrenert of 1,500 sq ft. built-up area. that is not a justification to deny the benefit of exemption from payment of income-tax under this provision In fact, the evidence on record is very clear that purchasers of the flats have put up the construction after the sale for which the assessee cannot be leld responsible. Merely because the assessee had made the provision which enable the purchaser to put-up the construction is no ground to deny the benefit which is granted under the Act, when the object o t housing scheme in substance is implemented strictl ir accordance with law. 12. In the instant case the Assessment Year is 2005-2006 arid both the amendments have come eter. rhe balcon o’ projection cannot oe considered for the Assessr ie it year 2005- 2006 and for pla n sanc brea tefore 1 April 2005 Similarly. tie ale of Pe 1 He use fia s by ndeo ndent saie deed also c relevart and r)roh,DItior for selhr q t’o f ats t.. sam pc.rcor’ ic nniy after . 009. t a; S. £ 7 -a S - 3 a; ‘C a, ‘r 3 0 p t S p 3 (1 0 tI I’ 3 0 3 1’ (13k ‘D a; (b ( I C. I 95 ‘p . 7 ‘4 ‘:33 C, - 7 - — S a, C - I ‘9 b i .1 "