Loading judgment…
No AI summary yet for this case.
Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD
Before: JUSTICE SHRI P. P. BHATT & SHRI PRADIP KUMAR KEDIA
PER PRADIP KUMAR KEDIA - AM:
The captioned appeal has been filed at the instance of the assessee against the order of the Commissioner of Income Tax (Appeals)-2, Ahmedabad (‘CIT(A)’ in short), dated 30.03.2015 arising in the assessment order dated 28.02.2014 passed by the Assessing Officer (AO) under s. 143(3) of the Income Tax Act, 1961 (the Act) concerning assessment year 2011-12.
ITA No. 1568/Ahd/15 [Himanshi Property Pvt. Ltd. vs. ITO] AY 2011-12 - 2 -
The grounds of appeal raised by the assessee read as under:
“1. In view of the facts and circumstances of the case, the Ld. CIT(A) has erred in confirming the addition of Rs.96,08,510/- made by the Ld. Assessing Officer and hence Your Appellant prays that the same be deleted. 2. Without considering facts and circumstances of the case, the Ld. CIT(A) has erred in law and in facts in directing the Ld.A.O. to make the further addition of Rs.18,79,490/- for the alleged violation of S.40(a)(ia) of the Act though the same expenditure has already been disallowed by the Ld. A.O. and the said disallowance is confirmed by the Ld. CIT(A) and hence Your Appellant prays that the same be deleted.”
When the matter was called for hearing, the learned AR for the assessee submitted with reference to Ground no.1 of its appeal that the AO has disallowed the construction costs (Rs.79.73Lakhs), architect fees (Rs.50 Lakhs) and BU permission expense (Rs.1.34 Lakhs) aggregating to Rs.96,08,510/- on the ground that the aforesaid expenditure were incurred after the BU permission applied on 27.08.2010 and granted by the Ahmedabad Municipal Corporation vide letter dated 07.08.2010. In this regard, the learned AR for the assessee referred to the construction cost account (at page no.20 of the paper book) and also the respective parties’ accounts to suggest that the expenses towards construction were actually incurred prior to the permission of Municipal Corporation and the aggregate expenditure were merely transferred to the construction costs account after the BU permission. The learned AR accordingly submitted that such book entries are neither decisive and nor determinative of the point of time of incurring expenditure. The learned AR thereafter referred to year- wise break up of income and cost and submitted that in the construction of building, the assessee in aggregate (including the expenditure in dispute) has incurred construction costs of Rs.4,12,75,256/- whereas the income on sale of flat has been recognized at Rs.5,12,31,406/- in aggregate spanning over the years of
ITA No. 1568/Ahd/15 [Himanshi Property Pvt. Ltd. vs. ITO] AY 2011-12 - 3 -
the project. It was thus contended that the assessee has shown handsome return of nearly 20% on the construction of the project. The learned AR thereafter referred to the various submissions placed before the lower authorities and contended that the Revenue has failed to appreciate the facts in perspective and indulged in a wrongful disallowance. It was further contended that some expenditures might have been incurred after the approval of the Municipal Authority also to enable it to meet the contractual obligations with the home buyers which may be objectively verified. The learned AR accordingly pleaded for remitting the matter back to the AO to re-visit the relevant facts to come to a rightful conclusion.
As regards Ground No.2, in response to disallowance of Rs.18,79,490/- for alleged violation of obligations cast under Chapter XVII towards deduction of tax, the learned AR pointed out that the assessee has duly deducted and deposited the tax albeit before the due date prescribed under s.139(1) of the Act and consequently, the assessee has not committed any default per se as contemplated in the relevant TDS provisions. The learned AR thus submitted that this issue also requires to be examined afresh by the AO in the light of evidences available in this regard.
Learned DR, on the other hand, relied upon the order of the AO and CIT(A) but however concurred with the averments made on behalf of the assessee for restoring the issue back to the file of the AO for de novo examination of factual aspects and for determining the issues involved afresh.
In view of the consensus forged between assessee and Revenue for restoring both the issues back to the file of the AO for fresh examination of facts in the background narrated above, we consider it
ITA No. 1568/Ahd/15 [Himanshi Property Pvt. Ltd. vs. ITO] AY 2011-12 - 4 -
expedient to restore both the issues to the file of the AO. It will thus be open to the assessee to satisfy the AO towards bonafides of its claims and to corroborate its submissions on both the issues with relevant facts and material in its possession. The AO is accordingly directed to consider both the issues afresh and decide the same in accordance with the law after giving reasonable opportunity to the assessee.
In the result, appeal of the assessee is allowed for statistical purposes.
This Order pronounced in Open Court on 24/01/2019
Sd/- Sd/- (JUSTICE P. P. BHATT) (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER PRESIDENT Ahmedabad: Dated 24/01/2019 True Copy S. K. SINHA आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व / Revenue 2. आवेदक / Assessee 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त- अपील / CIT (A) 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाइल / Guard file. By order/आदेश से,
उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद ।