MIG CO OPERATIVE HOUSING SOCIETY GROUP- II LTD,MUMBAI vs. ITO 19(3)(3), MUMBAI

आयकर आयकर अपीलीय आयकर आयकर अपीलीय अपीलीय अिधकरण अपीलीय अिधकरण अिधकरण, मुंबई अिधकरण मुंबई मुंबई “बी मुंबई बी बी” ” ” ” खंडपीठ बी खंडपीठ खंडपीठ खंडपीठ Income-tax Appellate Tribunal -“B”Bench Mumbai सव�ी राजे��,लेखा सद�य एवं अमरजीत �सह, �याियक सद�य Before S/Sh.Rajendra,Accountant Member and Amarjit Singh,Judicial Member आयकर अपील सं./`I.T.A./896/Mum/2016,िनधा�रण िनधा�रण वष� वष� /Assessment Year: 2011-12 िनधा�रण िनधा�रण वष� वष� MIG-Co-operative Housing Society Income tax Officer-19(3)(3) Group-II Limited Matru Mandir, Tardeo Road Kalpataru Sparkle,Nana Dhamadhikari Mumbai-400 007. Vs. Road, Gandhinagar, Bandra (E) Mumbai-400 051. PAN:AAAAM 8129 P (अपीलाथ� /Appellant) (��यथ� / Respondent) आयकर अपील सं./I.T.A./1099/Mum/2016,िनधा�रण िनधा�रण िनधा�रण वष� िनधा�रण वष� वष� /Assessment Year: 2011-12 वष� Income tax Officer-19(3)(3) Vs. MIG-Co-operative Housing Society Mumbai-400 007. Group-II Limited,Mumbai-400 051. (अपीलाथ� /Appellant) (��यथ� / Respondent) राज�व क� ओर से / Revenue by: Shri N.P. Singh –CIT-DR अपीलाथ� क� ओर से /Assessee by: Shri Yogesh Thar-AR सुनवाई क� तारीख / Date of Hearing: 05/12/2016 घोषणा क� तारीख / Date of Pronouncement: 17.02.2017 आयकर अिधिनयम आयकर अिधिनयम,1961 क� क� धारा धारा 254(1)केकेकेके अ�तग�त अ�तग�त आदेश आदेश आयकर आयकर अिधिनयम अिधिनयम क� क� धारा धारा अ�तग�त अ�तग�त आदेश आदेश Order u/s.254(1)of the Income-tax Act,1961(Act) लेखा सद�य लेखा सद�य, राजे�� राजे�� केकेकेके अनुसार अनुसार/ PER Rajendra A.M.- लेखा लेखा सद�य सद�य राजे�� राजे�� अनुसार अनुसार Challenging the order,dated 11/01/2016,of the CIT (A)-33,Mumbai the assessee and the Assessing Officer (AO)have filed cross appeals for the year under consideration. Assessee-a Co-operative Housing Society (Society) filed its return of income on 30/07/2012. 2.During the course of hearing before us,the Departmental Representative(DR)stated that the AO filed additional grounds of appeal with regard to re-opening of the assessment proceed - ings.He stated that no new or factual material was required to be referred to for deciding the legal issues raised in the additional grounds.The Authorised Representative(AR)of the assessee left the issue to the discretion of the Bench.We find that the AO has raised only legal grounds,hence ,we admit the same. Brief facts: 3.Assessee-Society is registered under the Maharashtra Cooperative Society Act, 1960.It owned 12 three floored buildings comprising of eight residential Flats in each building on a plot of land measuring around 9973.19 m². The plot of land on which the said buildings were constructed was held by it as a lessee under a long-term lease of 90 years,beginning from 16/05/1977,vide lease deed the executed on 12/12/2006.Apart from that in August,1997

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MHADA alerted and sold to the assessee additional Floor Space Index (FSI)of 2880 m² in respect of the entire plot and it also agreed to allowed the Society RG,Tit Bits area of 2783.66 m² in respect of entire plot for premiums less consideration recorded therein in 2010 the Society along with 96 of its members decided to redevelop the property by demolishing the old buildings and constructing new buildings upon the land measuring 9973.19 m² by utilising the aggregate FSI of 2302 8 m² consisting of land of 5032.15 m² utilised in old buildings.The Society share of its FSI purchased of 1728 m² and right to acquire an additional FSI of 16267.85 granted by MHADA to the Society.Accordingly,it entered into a redevelop - ment agreement with one developer, on 26/04/ 2010,for the redevelopment whereby out of the aggregate FSI of 23,028 m² it retained 10,012.18 m² and granted rights and entitlements to the developer for the balance FSI of 13,015.84 m².The members of the society agreed to transfer their old flats to the developer. In turn, the developer agreed to pay an amount of Rs. 53.50 lakhs to each of the members of the Society apart from Rs.15 crores to the Corpus Fund of the Society.The payment was in addition to the flats and parking spaces to be constructed and handed over to the members of the Society.Considering the market value and the benefits passed onto the Society in the deed,the Stamp Authorities(SA)valued the property in question at Rs.78.52 crores.The developer paid stamp duty on value of Rs.78, 51, 97,500/-. 3.1.The Society had not filed its return of income as required by the provisions of section 139 (1)of the Act i.e.by 30/09/2011-the due date of filing of return for the year under considera - tion.A notice u/s.148 was issued on 26/03/2013to the assessee considering the fact that it had entered into an agreement with the developer on 26/04/2010 and had transferred assets having stamp value of Rs.78.52 crores against the compensation received of Rs.51.36 crores. In the regions recorded,the AO mentioned that apart from the above considerations,the Society had received Rs.15 crores and had not offered any income out of the said transaction, that provisions of section 50C were applicable to the facts of the case.The notice was returned by the postal authorities with the remark ‘intimation posted-unclaimed’.However,the AO treated it a valid service of notice.Thereafter,it was noticed that assessee had filed its return belatedly on 30/07/2012 for the year under appeal declaring income of Rs.1.25 lakhs. It was also found by the AO that subsequently the case was also selected for scrutiny under CASS on the basis of the pieces of AIR information.He issued a notice u/s. 143(2) on 23/09/2013 and completed the assessment u/s.143 (3) r.w.s.147 of the Act on 27/03/2014, determining its income at Rs.103.58 crores.

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4.First ground of appeal,filed by the assessee,is about reopening of the assessment u/s. 147 of the Act.Additional grounds filed by the AO also deal with re-opening and issue of notice u/s. 143(2)of the Act. 4.1.In the appellate proceedings before the First Appellate Authority (FAA),the assessee argued that for the AY.under appeal time-limit to issue notice as per the provisions of section 143(2)available to the AO was up to 30/09/2013 and the time-limit for completing the scrutiny assessment u/s.143(3) was available up to 31/03/2014,that the notice u/s.148 was issued on 26/03/ 2013,that at the time of issue of the assessment notice time-limit for issuing notice u/s. 143 (2)of the Act and making scrutiny assessment u/s.143(3)had not expired,that the time-limit for conducting regular assessment had not elapsed the assessment made by the AO was void ab initio.It relied upon four case laws and stated that order passed by the AO should be quashed as same was bad in law. 4.2.The FAA held that there was no merit in the arguments advanced by the assessee.that it had not file return of income in time,that the AO had received separate information about the development agreement being executed on 26/04/2010-involving consideration of Rs.51.36 crores,that he had initiated the re-assessment proceedings accordingly,that assessee had filed its return in the month of July,2012, that the AO had already initiated proceedings u/s. 147, that the matter was selected through CASS, that the AO had issued notices u/s. 143(2) and 142(1) of the Act,that the AO had brought the reasons recorded for reopening to the notice of the assessee,that he completed the assessment u/s. 143 (3) r.w.s.147 of the Act,that the primary reason was the issue of notice u/s.148 of the Act before the selection of the case under CASS,that on the date of forming the opinion about escapement of income there existed no return and the due date for filing the return had expired,that the AO had no option and had initiated the proceedings u/s. 147,that the it had overlooked the circumstances under which the re-assessment proceedings were initiated,that there was no much substance in the argument of the assessee that notice u/s. 148 could not be issued when time-limit was available for issue of notice u/s.143(2) for making assessment u/s.143(3) of the Act.He further held that case laws,relied upon by the assessee,were of no help as the facts of the case under consideration were different from the facts of the matters referred to by the assessee. Finally,he held that there was no merit in the argument of the assessee made with regard to issue of notice u/s.148 and completion of assessment u/s.143(3)of the Act. 4.3.During the course of hearing before us, the Authorised Representative (AR) reiterated the arguments advanced before the FAA.He further argued that an intimation u/s.143(1) was issued on 29.11.2013 in this case,that in the case under consideration notice u/s.148 was 3

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issued before intimation u/s.143(1) was issued,that there was no fresh material to issue re- opening notice,that the judicial forums are unanimous that if time limit available u/s.143(3) is available,a notice u/s. 148 should not be issued,that in the order sheet,in the reasons recorded, in the notice issued for levying penalty u/s. 271(1)(B)of the Act,the AO had clearly mentioned that assessment was passed u/s. 143(3)r.w.s. 14.He referred to pages 401-455 of the PB and relied upon cases of Jagmohan Sharma (ITA/1384/Kol/2013,dated 05.09. 2014, AY :2006-07); M/s. Roy & Co.(ITA/166/Kol/2013 dated 05.09.2014,AY: 2005-06) and Tcp Ltd.(323ITR346).He further contended that the members were paid compensation by the developer in their individual capacity,that the receipt of such income was disclosed by them in their respective returns,that corpus fund contributed by developer to the Society was also offered in its return,that amounts received by members of the society could not be assessed in the hands of the assessee,that provisions of Section 50C were not applicable, that the society was not the owner of the land, the agreement entered into with the developer was an agreement for transfer of development rights, that the provisions of Section 50C applied to land/building or rights in respect of land or building and not the development rights,that the society continued to be a lessee,that the development rights had no cost of acquisition, that the transfer of such rights would not be taxable,that the new right came into existence because of new Regulation, that right accrued to the society were akin to TDR , that the members had formed a society,that MHADA created lease hold rights in favour of society from the year 1996-97,the transfer of lease hold was not covered by provisions of section 50C of the Act,that the amount of Rs.15crores was taxed twice i.e. in the hands of the society and the members.He referred to the decision of the Hon'ble Bombay High Court in the case of Kailash Jyoti & Ors. in Income tax Appeal No.1607 of 2013 dated 24th April, 2015. He stated that identical issue was dealt by the Tribunal in case of Raj Ratan Palace Co. Op. Hsg. Society Ltd.(46SOT217),that the Hon'ble Bombay High Court had upheld the order of the Tribunal (Pg.121 of the PB).He argued that in the case of Voltas (74taxmann.com69) it has been held that provisions of section 50C would be applicable in case of land/building only, that society continued to be the lessee (Pg.-129-175 of LPB). 4.3.1.The DR argued that notice issued u/s.148 of the Act was never served on the assessee, that the AO had talked of deemed service of notice in the assessment order, that the service cannot be deemed,that constructive service was required.He referred to the cases of Rajeev Kumar Doneria (94ITD345); Hotline International Pvt.Ltd.(296ITR333)and Mysore Minerals Ltd. (Cvl.Appeal No.5374 of 1994,dt.01/09.1999) of the Hon'ble Supreme Court .

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With regard to the merit of the case,the DR stated that society was the owner of the property, that only society could transfer the right to the developer.He referred to Pg.no.336(Para 27, 28,18) of the PB .He also made a reference to the letter to Kotak Mahindra Bank dt.30-11-09 and stated that from the conduct of the society it was clear that soc was owner of the flats. He also stated that facts of Raj Ratan Society(supra)were not applicable to the case under consideration, that in the case of Raj Ratan building was not demolished,that builder was given right to develop only the rear portion of the property,that in that matter members had entered into agreement with the developer. In his rejoinder,the AR argued that the department cannot approbate and reprobate at the same time,that for service of notice it cannot be argued that there was no service of notice when the AO himself had talked of constructive service. 4.4.We have heard the rival submissions and perused the material.We find that in the present case development-agreement was executed by the society and the developer,that the developer had made payments to the flat owners in their individual capacity,that contribution towards corpus of the society was also paid by developer,that the society as well as individual member had offered receipt of income in their returns,that the AO and the FAA were of the view that payment made by the developer was to be taxed in the hands of the society. 4.4.1.Here,it will be useful to take notice of the case of Raj Ratan Palace Co-operative Housing Society(supra),wherein the Tribunal had dealt with the similar issue.It that matter the society consisted of 51 members and was owner of certain property.It entered into an agreement with a developer for development of said property.The Tribunal recorded the following facts: “The assessee was a registered housing society having 51 members and duly elected managing committee. It was the owner of a property admeasuring 3316 sq.meters or thereabouts together with ‘R’ building. The society invited offers from builders for redevelopment of its property by construction of a new multi-storey building behind the ‘R’ building, by means of T.D.R. from elsewhere and by the consumption of available F.S.I. of the said property, after demolishing the existing bungalow.In pursuance of the above ‘N’ submitted tender for development of society’s said property. The assessee society vide agreement dated 18.05.1996 agreed to grant to the developers permission leave and licence to enter upon the society’s property and with the right to demolish the said bungalow and construct a new multi-storey R.C.C. building, on the terms and conditions mutually agreed upon by the and on behalf of the society and the developers. It was not in dispute that as per terms of agreement the assessee society was paid only a sum of Rs.2,51,000. The consideration mentioned in clause 12 of the agreement of Rs.2,00,16,828/- was later revised to a sum of Rs.3,02,16,828/- because of the additional FSI that the builder had constructed. The sum of Rs.3,02,16,828/- was paid by the developer to the individual members of the society totalling in all about 51. The assessee filed its return of income wherein it did not offer any sum to tax in respect of the agreement dated 18.5.1996. The Assessing Officer, however, was of the view that the assessee was the owner of the land and by virtue of clauses 12 & 13 of the agreement dated 18-5-1996 it 5

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was entitled to the entire compensation of Rs.3,02,16,828/-.he was of the view that the assessee held a capital asset and allowed the developer namely ‘N’ to construct the multi-storied building on the surplus land belonging to the society and received compensation. The Assessing Officer held that the said receipt of compensation was taxable as per the provisions of section 2(24). He also held that the agreement between the developer and the individual 51 members of the society was only to facilitate payment by the developer and it did not absolve the society from the taxability of the entire proceeds.Thus, a sum of Rs.3,02,16,828/- was added by the Assessing Officer .On appeal, the Commissioner(Appeals) upheld the addition made by the Assessing Officer.” After considering the submission of the both the sides,the Tribunal has held as under - “It was apparent from records that under the agreement dated 18-5-1996 the assessee society gave permission to the developer to construct on the society’s land. No part of the land was ever transferred to the society. The society merely gave permission to the developer to carry out development in the rear side of the existing building ‘R’ after demolishing a small bungalow which was in existence. Clauses 12 & 13 of the agreement dated 18-5-1996 clearly mentioned that the developer would pay compensation to the society and members. The sum was quantified at Rs.2,00,16,828/-.Out of this only a sum of Rs.2,51,000/- was paid to the society. Admittedly, the remaining sum and the additional sum payable under clause 13 of the agreement dated 18-5-1996 was paid to the individual members of the society under 51 different agreements. Thus it was clear that the assessee did not part with any rights in property and did not receive any consideration except a sum of Rs.2,51,000. In such circumstances, one failed to see as to how there could be any incidence of taxation in the hands of the assessee. Besides, the order of the Assessing Officer was vague. It was not clear as to whether the sum in question was brought to tax as capital gain in the hands of the assessee or as income under section 2(24). Neither of the above provisions could be pressed into service for bringing the sum in question to tax in the hands of the assessee. As already seen that there was no receipt by the assessee except a sum of Rs. 2,51,000. The sum so received was for merely granting consent to consume TDR purchased by the developer from a 3rd party. The society continued to be the owner of the land and no change in ownership of land had taken place. Mere grant of consent would not amount to transfer of land/or any rights therein. It was also seen that the some of the individual members had offered the receipts from the developer to tax and the same had also been brought to tax in the hands of the individual members. In this scenario, the addition made in the hands of the assessee society was without any basis. Consequently the addition made in ·the hands of the society was to be deleted. [Para 12] Before the Hon'ble Bombay High Court following question was raised by the department- “Whether on the facts and in the circumstances of the case and in law, the Tribunal is right in holding that amount received cannot be taxed in the hands of assessee society because society continues to be owner of the land as no change in ownership of land has taken place without appreciation the fact that the assessee has received compensation of Rs.3,02,16,828/-for granting the developer the right to develop the property which is clearly taxable as per provisions of Section 2(24) read with Section 2(47) and 2(14) of the Income Tax Act?” The Hon’ble Court decided the issue as under : “2. The Revenue seeks to tax the society in respect of the amount received on transfer of TDR. The Tribunal in the impugned order recorded a finding of fact that the amount which was received on the transfer of TDR was received by members of Respondent Society. The members of the Society had offered the amounts received by them to tax in their individual returns. In fact,copies of orders of the Tribunal in respect of individual members who received amount from the developers and offered to tax was also placed before the Tribunal. 3. As the decision is based on a finding of fact which is not challenged by the Revenue as being perverse, we see no reason to entertain the proposed question of law. 4 Accordingly, appeal is dismissed with no order as to costs. ”

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We find that facts of the case before us are almost similar to the facts of Raj Ratan Palace CHG(supra).As stated earlier,the developer had made payments to the Society as well as to the members and they had offered the amounts,received by them,for taxation.In our opinion,once the members had shown the income received by them in their hands there can - not be any justification for taxing the same in the hands of society.No double taxation and no double deduction is one of the well recognised and fundamental principles of taxation.In our opinion,signing of agreement by the members or society cannot be base for taxing of income. As per the scheme of the Act,income received by any person or income accrued to him has to be taxed.In the case under consideration,income was received by the members and they had offered the same for taxation. 5.We also hold that Society was only the lessee and what was transferred to the developer was development rights not land or building .Section 50C of the Act stipulates as under: “Where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both…..” No authority is required to hold that terms ‘land or building’ ‘or both’ do not include development rights and that in the case before there was transfer of such rights only. In light of the above discussion and respectfully,following the judgment of the Hon'ble High Court in the case of Raj Ratan CHS(supra),we hold that FAA was not justified in taxing the sum of Rs. 53.50 crores in the hands of the assessee,as same was the income of the members of the society.GOA.2 is decided in favour of the assessee.

6.As we have decided the issue on merits,so we are not dealing with technical Grounds raised by the assessee with regard to re-opening of the assessment.

7.Ground No.3 is alternate Ground to Ground No.1 and 2.The assessee has argued that FAA had not allowed it the option of substituting the FMV as on 1.4.1981 duly indexed in term of section 55 r.w.s. 48 of the Act.While deciding Ground No.2,we have already held that the disputed amount cannot be taxed in the hands of the assessee.So, Ground No.3 are allowed for statistical purposes.

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8.3.We find that the FAA had held that Rs.3.50 crores only were to be taxed during the year under consideration,that the income was to be taxed under the head income from other sources.It is a fact that society had not given possession of land to the developer during the year under consideration.In our opinion,the money received by the assessee during the year i.e. Rs.3.50 crores was to be assessed under the head capital gains, as claimed by the assessee. Fourth Ground is decided in favour of the assessee.

9.Ground No.5 is about taxing Rs.9.04 crores.During the assessment proceedings the AO noted that as per clause 5A of the Agreement the society was to receive a benefit by way of discharge of liabilities which were otherwise dischargeable by it from its own fund, that the developer had paid Rs.9.04crores on behalf of the society including the cost of land (74.29 lakhs alloted by the MHADA to the society).Finally, he held that the amount in question i.e. Rs.9,04,78,741/- had to be assessed under the head income from ‘other sources’ as same was not taxable under any other head. 9.1.During the appellate proceedings before the FAA,the assessee argued that it had not received any money except Rs.15 crores from the developer, that if the disputed amount was to be taxed in its hand expenditure incurred by it should be allowed. After considering the submission of the assessee the FAA held that payment of Rs.9.04 crores, made by the developer, was application of income accrued and arisen to the assessee society during the year under consideration. He referred to cases of Sitaldas Tirthdas (41ITR367),Vibhuti Glass works (177ITR439) and MK Brothers Pvt.Ltd.(63ITR28) and held that the AO had correctly taxed Rs.9.04 crores paid by developer to MHADA on behalf of the society as income from other sources. 9.2.Before us,the AR argued that the developer had to pay MHADA certain sums for developments,that AO had wrongly held that premium paid by the developer was the income of the assessee.Alternatively,it was argued that even if it was to be treated as income taxable in the hands of the society,same should have been allowed as an expense, that nothing would survive for taxation.The DR left the issue to the discretion of the Bench. 9.3.We find that the developer had made payment to MHADA,that the AO treated it as income of the assessee.In our opinion, payment made to a government agency in persuance of an agreement cannot be treated income of assessee.As far as principle of application of income is concerned,we would like to state that the true test for the application of the rule of diversion of income by an overriding charge, is whether the amount sought to be deducted, in

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truth, never reached the assessee as his income. Obligations, no doubt, there are in every case, but it is the nature of the obligation which is the decisive fact. There is a difference between an amount which a person is obliged to apply out of his income and an amount which by the nature of the obligation cannot be said to be a part of the income of the assessee. Where by the obligation income is diverted before it reaches the assessee, it is deductible; but where the income is required to be applied to discharge an obligation after such income reaches the assessee,the same consequence, in law, does not follow. It is the first kind of payment which can truly be excused and not the second. The second payment is merely an obligation to pay another a portion of one's own income, which has been received and is since applied.We are of the opinion that disputed amount falls in first category.In the case before us,the obligation income was diverted before it reached the assessee.Besides,the payment is not in doubt and it is also a fact that same was made in connection with the development of the property.So,as a corollary,it has to be allowed as an allowable expenditure.Considering the circumstances and facts of the case,we decide ground no.5 in favour of the assessee.

ITA/1099/Mum/2016: 10.The issue of re-opening of assessment has been raised by the AO in additional grounds. While dealing with the similar ground of the assessee,in the earlier part of the assessment,we have mentioned that we would like to decide the matter on merits and not on technical issues.Following the same,we are not deciding the grounds about issue of notice u/s.148 of the Act the reassessment.

11.First Ground of appeal is about deletion of an amount of Rs.11.50 crores received by the assessee towards corpus and accrued interest thereon. 11.1.In the earlier part of our order, we have narrated the facts and have held that FAA had rightly taxed Rs.3.50 crores only during the year under appeal, that Rs.11.50 crores and interest of Rs.1.43 crores were not received by the assessee and hence,were not taxable for the AY 2011-12.Confirming his order ,we hold that there is no infirmity in that order and he has rightly deleted the addition made on account of corpus fund and interest accrued on it.First Ground of appeal is decided against the AO.

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12.Next is about allowing deduction u/s.80P of the Act.During the assessment proceedings, the AO held that the society had violated the principles of mutuality,that the provisions of section 80P were not applicable to a Co-op.Housing Society,that the assessee had made deposits out of money received against redevelopment agreement and from different channels, that same was not permissible under byelaws of the society,that it had transferred a sum of Rs.2.97 crores from the corpus fund to the P&L account,that such investment in banks would not qualify for deduction u/s.80P of the Act.Finally,he denied the assessee the benefit of deduction u/s. 80P. 12.1.During the appellate proceedings the assessee referred to provisions of section 80P(2) of the Act especially 80P(2)(c)(ii) and 80P(d) of the Act and relied upon the case of Daoba Co- op Sugar Mills Ltd.230/774,Ashok APT CHS Ltd.(ITA/2845/M/2010),Sagar Sanjog CHS Ltd.(ITA/1972-74/Mum/2005);Panchratna Co-op.Hsg Ltd.(ITA2858/Mum/2010). Referring to the provisions of section 80P of the Act,the FAA held that restrictions put by the section was with regard to income received by way of interest on securities/income from house property, that the restriction could be extended to other sub sections of section 80P(2), that there was no bar for claiming deduction under other sub sections of Section 80P(2)by a Co- op. Hsg. Society,that deductions could not be denied by observing that the society had breached the principle of mutuality or had violated the bye laws,that till the society was registered as a CHS in the Register of the Registrar of Co-op. Society deduction u/s.80P could not be denied. Finally,he allowed the appeal filed by the assessee. 12.2.Before us,the DR relied upon the order of the AO and the AR relied upon the order of the FAA. 12.3.We find that the assessee had made a claim deduction of Rs.47.08 lakhs and Rs.50,000/- u/s. 80P(2)(d)and80P(2)(c)(ii)respectively,that the AO had invoked the provisions of Sec.80P (2) (f)and denied the society the benefits claimed by it.In our opinion,the sub sections of 80P deal with different claims and operate in different fields.The provisions of one sub section cannot be imported to another sub section.It is a fact that the Registrar of Co-op.Hsg. Society had not cancelled the registration of the Housing Society on the alleged violation of principle of mutuality or bye laws.In these circumstances,in our opinion the FAA has rightly held that deduction claimed by the assessee under sub-sections (d) and (c)(ii) cannot be denied the assessee.Upholding his order,we dismiss the ground raised by the AO.

As a result,appeal filed by the assessee is partly allowed and the appeal of the AO is dismissed. 11

896&1099/M/16- MIG Co-op.Hsg. Soc. Group-II फलतः िनधा�रती �ारा दािखल क� गई अपील अंशतः मंजूर क� जाती है और िनधा�रती अिधकारी �ारा दािखल क� गई अपील नामंजूर क� जाती है.

Order pronounced in the open court on 17th February , 2017. आदेश क� घोषणा खुले �यायालय म� �दनांक 17 फरवरी , 2017 को क� गई । Sd/- Sd/- (अमरजीत �सह / Amarjit Singh ) (राजे�� / Rajendra) �याियक सद�य / JUDICIAL MEMBER लेखा लेखा लेखा सद�य लेखा सद�य सद�य / ACCOUNTANT MEMBER सद�य मुंबई Mumbai; �दनांकDated : 17.02.2017. Jv.Sr.PS. आदेश क� क� �ितिलिप �ितिलिप अ�ेिषत अ�ेिषत/Copy of the Order forwarded to : आदेश आदेश आदेश क� क� �ितिलिप �ितिलिप अ�ेिषत अ�ेिषत 1.Appellant /अपीलाथ� 2. Respondent /��यथ� 3.The concerned CIT(A)/संब� अपीलीय आयकर आयु�, 4.The concerned CIT /संब� आयकर आयु� 5.DR “A ” Bench, ITAT, Mumbai /िवभागीय �ितिनिध, खंडपीठ,आ.अ.�याया.मुंबई 6.Guard File/गाड� फाईल स�यािपत �ित //True Copy// आदेशानुसार/ BY ORDER, उप/सहायक पंजीकार Dy./Asst. Registrar आयकर अपीलीय अिधकरण, मुंबई /ITAT, Mumbai.