VANDANA INFRA REALTY,BANGALORE V. DCIT, CIRCLE-4(3)(1), BANGALORE

ITA 2417/BANG/2024

AI Insights

The case involves M/s. Vandana Infra Realty, the appellant, who challenged the order of the CIT-A regarding the disallowance of labor charges under Section 37 of the Income Tax Act for the Assessment Year 2018-19. The appellant argued that the labor charges were essential for the construction of flats, which were sold during the year, and contested the CIT-A's findings that these charges were not necessary for business. However, during the tribunal proceedings, it was revealed that the appellant had opted for the Direct Tax Vivad Se Vishwas Scheme, 2024, and had complied with all procedural requirements, including the payment and filing of forms. This led to the dismissal of the appeal as infructuous.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 312217 (ITAT-BANGALORE)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-04-2025
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2018-2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: SUBRAMANIAN S
• Assessee Lawyers: V. SRIDHAR
• Section: 37; 37(1)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL ‘B’ BENCH : BANGALORE BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER AND SHRI SOUNDARARAJAN K., JUDICIAL MEMBER ITA No. 2417/Bang/2024 Assessment Year : 2018-19 M/s. Vandana Infra Realty, No. 520/2, Sarjapur Road, Anekal Taluk, Bangalore – 560 102. PAN: AAJFV5163G Vs. The Deputy Commissioner of Income Tax, Circle – 4(3)(1), Bangalore. APPELLANT RESPONDENT Assessee by : Shri V. Sridhar, FCA Revenue by : Shri Subramanian .S, JCIT- DR Date of Hearing : 07-04-2025 Date of Pronouncement : 30-04-2025 ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 15.10.2024 in respect of the A.Y. 2018-19 and raised the following grounds: “1. The order of CIT-A is opposed to Law and Facts of the Case. 2. The CIT-A failed to appreciate that the appellant having constructed flats and sold the same during the year without incurring of labour charges is not correct. Page 2 of 3 ITA No. 2417/Bang/2024 3. The CIT-A failed to appreciate that the appellant having sold the flats during the year and offered the sale consideration of Rs.11,29,81,989/- construction of building the labour is a must and cannot be held as not necessary for business and disallowance U/s 37 is not correct. 4. The CIT-A is not correct in coming to the conclusion that payment made to each labourer is more than Rs.20,000/- when the payment is made to number of labourers on a weekly basis. 5. The CIT-A failed to appreciate that the appellant himself has paid the labour charges on a weekly basis as per the account copy enclosed. 6. The CIT-A failed to appreciate that labour charges being one of the main ingredient in construction cannot be held as not for the purpose of business and disallowance U/s 37(1) is not correct. 7. The CIT-A failed to appreciate that the proof of payment which is bulk could not be upload in the system. 8. The appellant craves, lead to add, alter, amend, substitute, change and delete any grounds of appeal. 9. For the above and other grounds that may urged at the time of hearing, the appellant prays that the appeal may be allowed and Justice rendered.” 2. At the time of hearing, it was brought to our notice that the assessee had opted to avail the settlement scheme under the Direct Tax Vivad Se Vishwas Scheme, 2024 and also filed a copy of form 1 filed before the authority. The assessee also filed form 2 and form 3 to show that the amount quantified by the authority was also paid on 07/02/2025 and informed that the assessee is awaiting for the issuance of form 4. 3. In such circumstances, there is no purpose in keeping this matter pending for hearing since the assessee had already availed the settlement under the Direct Tax Vivad Se Vishwas Scheme, 2024. Recording the said submissions made by the Ld.AR, we dismiss this appeal as infructuous. Page 3 of 3 ITA No. 2417/Bang/2024 4. In the result, the appeal filed by the assessee is dismissed as infructuous. Order pronounced in the open court on 30th April, 2025. Sd/- Sd/- (WASEEM AHMED) (SOUNDARARAJAN K.) Accountant Member Judicial Member Bangalore, Dated, the 30th April, 2025. /MS / Copy to: 1. Appellant 2. Respondent 3. CIT 4. DR, ITAT, Bangalore 5. Guard file 6. CIT(A) By order Assistant Registrar, ITAT, Bangalore "