DELHI DEVELOPMENT AUTHORITY,NEW DELHI vs. ACIT,(EXEMPTIONS) CIRCLE-1(1), NEW DELHI
Before: MS. MADHUMITA ROY, & SHRI NAVEEN CHANDRA
PER NAVEEN CHANDRA, A.M:-
This appeal by the assessee is preferred against the order of the NFAC, Delhi dated 30.06.2023 for A.Y 2011-12. 2. The grievances of the assessee read as under:
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“1. That on the facts and in circumstances of the case, the order dated 30-12-2018 passed by Assistant Commissioner of Income- tax Exemptions, Circle 1(1) (hereinafter referred to as "Ld. AO"]
under section 143(3) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"] and as upheld by the Ld. Commissioner of Income-tax (Appeals) -40, New Delhi (hereinafter referred to as "the CIT(A)"] is bad at law and void ab initio.
2. That the Ld. AO and Ld. CIT (A) erred in upholding:
a) That the Appellant is not eligible for the exemption/benefits as envisaged in section 11 and 12. b) The case of the Appellant falls under the last limb of section 2(15) and is hit by the proviso of section 2(15) of the Act; and c) That the provisions of section 13(8) are applicable to the facts of the Appellant.
3.1 That the Ld. CIT(A) erred in upholding that the expenditure incurred by the Appellant to the tune of Rs. 2,25,72,08,800/- is not allowable u/s 40A(9) of the Act.
3.2 That without prejudice to ground no 3.1, the Ld. CIT(A) erred in not allowing Rs 26.70 crore paid to employees on post-retirement medical expenditure during the year out of the accumulative liability.
4. That on facts and in law the Ld. AO erred, and Ld. CIT (A) upheld in levying interest u/s 234B of the Act.”
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Briefly stated, the facts of the case are that the assessee was granted registration u/s 12A of the Income-tax Act, 1961 [the Act, for short] w.e.f. 01.04.2002 dated 12.01.2006. The assessee, Delhi Development Authority (DDA) is a statutory body created by Delhi Development Act, 1957. As per the assessee, it is a city development agency constituted by the Parliament Act, viz. Delhi Development Act, 1957 with the object of development of Delhi. It encompasses Development of land, buildings and infrastructure in the city like water, sewer, roads, flyovers, greens, etc. It has to cater to the need or shelter of people of all walks of life. 4. The assessee filed its Return of Income on 14.10.2016 declaring NIL income. Return was selected for scrutiny assessment through CASS and accordingly, statutory notices were issued and served upon the assessee. The Assessing Officer assessed the income of the assessee at Rs. 5,12,80,66,351/-. 5. Aggrieved, the assessee went in appeal before the ld. CIT(A) who finding no infirmity in the order of the Assessing Officer, dismissed the appeal of the assessee on both the grounds. 6. Aggrieved further, the assessee is in appeal before us. 7. Before us, the ld. counsel for the assessee submitted that the issue whether the activities of the authority, as per section 2(15) of the [A.Y. 2016-17] Delhi Dev. Authority Vs. ACIT[E]
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Income-tax Act, 1961 [the Act, for short] is within 20% as per the decision of the Hon'ble Supreme Court in the case of Ahmedabad Urban
Development Authority 449 ITR 1 be remanded back to the file of the Assessing Officer with a direction to consider the same afresh. The ld.
counsel for the assessee relied on the decision of ITAT in Jhansi
Development Authority ITA Nos. 2689 to 2693 of 2013 order dated
8.07.2024 and prayed for setting aside the matter to the file of the Assessing Officer for examining the same afresh.
8. Per contra, the ld. DR fairly conceded to the same.
9. We have heard the rival submissions and have perused the relevant material on record. We find that the co-ordinate bench of ITAT Delhi in the case of Jhansi Development Authority ITA Nos. 2689 to 2693 of 2013 order dated 8.07.2024 has relied on the guidelines framed in the decision of the Hon'ble Supreme Court in the case of Ahmedabad Urban
Development Authority [supra] and remitted the matter to the file of the Assessing Officer to consider the same afresh and pass order strictly in light of the observation of the hon’ble Supreme Court.
10. After considering the facts and submissions and perusing the orders of the co-ordinate bench and the Hon'ble Apex Court [supra], we are of the considered opinion that the issue of taxability of the DDA u/s 2(15) of the Act be remitted to the file of the Assessing Officer for examination
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afresh and decide the issue in accordance with the guidelines/observations made by the Hon'ble Apex Court on identical issue after allowing reasonable opportunity of being heard to the assessee. We order accordingly. Grounds raised by the assessee are allowed for statistical purposes.
11. In the result, the appeal of the assessee in ITA No. 2888/DEL/2022
is allowed for statistical purposes.
The order is pronounced in the open court on 21.11.2025. [MADHUMITA ROY]
[NAVEEN CHANDRA]
JUDICIAL MEMBER
ACCOUNTANT MEMBER
Dated: 21st November, 2025. VL/