M/s SOUTHERN HILLS DEVELOPERS PRIVATE LIMITED vs. THE DEPUTY COMMISSIONER OF INCOME TAX

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ITA/40/2017HC KarnatakaKAHC01020272201723 August 2022Bench: P.S.DINESH KUMAR,UMESH M ADIGA4 pages
AI SummaryRemanded

What did the High Court hold?

The High Court found that the ITAT's order was bereft of independent reasons, as it extracted the CIT(A)'s order without recording its own reasoning. Therefore, the ITAT's order was set aside.

What were the facts?

The assessee argued that the ITAT dismissed their appeal without independent application of mind, merely extracting portions of the CIT(A)'s order. The Assessing Officer had computed expenditure at 79.9% in two projects, while the assessee contended the total expenditure was 65.14%.

What were the issues?

Whether the ITAT properly applied its mind and provided independent reasoning while dismissing the assessee's appeal, or merely adopted the CIT(A)'s reasoning.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 23RD DAY OF AUGUST, 2022 PRESENT THE HON'BLE MR. JUSTICE P.S. DINESH KUMAR AND THE HON'BLE MR. JUSTICE UMESH M. ADIGA INCOME TAX APPEAL NO. 40 OF 2017

BETWEEN :

M/s SOUTHERN HILLS DEVELOPERS PRIVATE LIMITED 7TH FLOOR, NITESH TIMESQUARE NO.8, M.G. ROAD BANGALORE-560 001. REPRESENTED BY ITS AUTHORIZED SIGNATORY SRI S. NAGABHUSHANAM AGED 63 YEARS S/O SRI S. SUBRAMANYAM …APPELLANT

(BY SMT. SHEETAL BORKAR, ADVOCATE FOR SHRI. S PARTHASARATHI, ADVOCATE)

AND : THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE-12(2) ROOM NO.732, BMTC BUILDING 80 FEET ROAD, 6TH BLOCK KORAMANGALA BANGALORE-560 095. …RESPONDENT

(BY SHRI. E.I. SANMATHI, ADVOCATE FOR SHRI. K.V. ARAVIND, ADVOCATE) . . . .

Digitally signed by S P SUDHA Location: HIGH COURT OF KARNATAKA

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THIS INCOME TAX APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED:26/08/2016 PASSED IN ITA NO.1829/BANG/2013, FOR THE ASSESSMENT YEAR 2007-2008, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN AND ETC.

THIS INCOME TAX APPEAL COMING ON FOR HEARING, THIS DAY, P.S. DINESH KUMAR J., DELIVERED THE FOLLOWING:

JUDGMENT

This appeal by the assessee has been admitted to consider the questions of law raised in the Memorandum of appeal.

2.

Shri. Sheetal Borkar, learned Advocate for the assessee submitted that the Assessing Officer has computed the expenditure at 79.9% in two projects where as, the total expenditure of the project is 65.14%. For the subsequent years namely for A.Y. 2008-09, CIT(A)1 has held the total expenditure at 61.60%. The ITAT2 without properly appreciating the facts and law on the point has dismissed the appeal by extracting a portion of CIT(A)'s order.

1 Commissioner of Income Tax (Appeals) 2 Income Tax Appellate Authority

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3.

In substance, learned Advocate submitted that there is no independent application of mind by the ITAT.

4.

Shri. E.I.Sanmathi, learned Advocate for the Revenue, opposing the appeal submitted that the ITAT has concurred with the view taken by the CIT(A). Therefore, the same must be treated as the view of ITAT.

5.

We have carefully considered rival contentions and perused the records.

6.

The ITAT has recorded the submissions of the learned representatives for the assessee and the Revenue till para 5. In para 6, it has extracted paras 7 to 9 of CIT(A)'s order and without recording any reasons dismissed the appeal. Therefore, we are persuaded to accept the argument advanced on behalf of the assessee that the order passed by the CIT(A) is bereft of any independent reasons.

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7.

In view of the above, the following: ORDER

(a) Appeal is allowed. (b) The order dated 26.08.2016 in ITA No.1829/Bang/2013 passed by the ITAT, is set- aside. (c) The matter is remitted to the ITAT for fresh consideration in accordance with law. (d) As the matter has been remitted to the ITAT, the questions of law are not answered.

No costs.

Sd/- JUDGE

Sd/- JUDGE SPS List No.: 1 Sl No.: 33

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