M/S. PUSHPA DEVELOPERS CO.,MUMBAI vs. DCIT , CIRCLE-3,, THANE

Ground no. 1, being not pressed, is dismissed.

As regards Ground no. 2, learned counsel for the assessee submitted, though, the Assessing Officer (AO) made an addition of Rs. 1,57,43,696/- on Assessment Years: 2011-12 & 2015-16 account of alleged difference in valuation of closing stock of unsold transferable development right (TDR) and the value at which the assessee actually sold TDR during the year. Though, the addition was confirmed by learned Commissioner (Appeals), however, considering the fact that deduction under section 80IB(10) of the Income Tax Act, 1961 has been allowed on the said addition by learned Commissioner (Appeals) resulting in acceptance of the income declared by the assessee in the return of income, there is no tax implication on the assessee. Therefore, on instructions, he requested for withdrawal of the present appeal. As the issue raised has become academic.

The learned Departmental Representative agreed with the aforesaid submission of the assessee. In view of the stated factual position, the appeal having become infructuous is dismissed.

In the main grounds of appeal

Drawing our attention to Ground No. 3A of the additional grounds, learned counsel for the assessee submitted that the assessee is a builder and developer and was developing a project for Slum Rehabilitation Authority (SRA). He submitted, the assessee recognizes revenue following project completion method and the profit from the SRA project was offered in assessment year 2011-12 after completion of the project. He submitted, though, the assessee had applied for TDR of 488.29 sq.mtr, however, it was not granted to the assessee in assessment year 2011-12 and the assessee had shown value of unsold TDR in its account. He submitted, the profit from the SRA project offered in assessment year 2011-12 also included an amount of Rs. 10,51,190/-, being the value of unsold TDR as per valuation made on the basis of cost or market value, whichever is less. He submitted, while completing the assessment for assessment year 2011-12, the AO determined the value of TDR at Rs. 1,67,94,886/- and added to the profit of the SRA project. He submitted, the AO also did not allow deduction under section 80IB(10). He submitted, though, learned Commissioner (Appeals) upheld the addition of TDR, however, he allowed assessee’s claim of Assessment Years: 2011-12 & 2015-16 deduction under section 80IB(10) of the Act in respect of TDR. He submitted, in the order giving effect to the order of learned Commissioner (Appeals), the AO has also allowed deduction under section 80IB(10) of the Act in respect of TDR. Thus, he submitted, once addition in respect of entire value of unsold TDR was made in assessment year 2011-12, no further addition in respect of sale of part of such TDR could be made in the impugned assessment year, as it would amount to double addition of the same income. Further, he fairly submitted that this fact was never brought to notice of the departmental authorities in course of proceedings before them. Thus, he sought appropriate direction to the AO.

The learned Departmental Representative has no objection for restoration of the issue to the AO for considering assessee’s claim after factual verification. 8. We have considered rival submissions and perused the materials on record. In principle, we agree with the submissions of learned counsel for the assessee that if a particular item of income has been added in one assessment year, the same amount of income or a part of it cannot be added in another assessment year. From the facts on record, prima facie, it appears that the entire estimated value of unsold TDR measuring 488.29 sq.mtr was added to the income of the assessee in assessment year 2011- 12. It is evident, the assessee has sold a part of the TDR in the impugned assessment year. The consideration received from sale of such TDR has been added to the income of the assessee in the impugned assessment year. Thus, prima facie, it appears to be a case of addition of the same Assessment Years: 2011-12 & 2015-16 income in two different assessment years. However, since the issue has been raised for the first time before us and the departmental authorities had no occasion to verify assessee’s claim, we are inclined to restore the issue to the AO for factual verification and deciding assessee’s objection regarding double addition of the same income. The AO is directed to verify the facts and decided assessee’s claim after due opportunity of being heard. 9. In view of our aforesaid decision, the other substantive grounds raised