RUPVAKULA PROPERTIES LTD, MUMBAI v. ITO WD 10(2)(3), MUMBAI

ITA 1018/MUM/2010 | 2006-2007
Pronouncement Date: 22-12-2010 | Result: Allowed

Appeal Details

RSA Number 101819914 RSA 2010
Assessee PAN AABCR7425A
Bench Mumbai
Appeal Number ITA 1018/MUM/2010
Duration Of Justice 10 month(s) 13 day(s)
Appellant RUPVAKULA PROPERTIES LTD, MUMBAI
Respondent ITO WD 10(2)(3), MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 22-12-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted D
Tribunal Order Date 22-12-2010
Assessment Year 2006-2007
Appeal Filed On 08-02-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D MUMBAI BEFORE SHRI R.S.SYAL ACCOUNTANT MEMBER AND SHRI VIJAY PAL RAO JUDICIAL MEMBER ITA NO. 1018/MUM/2010 (ASSESSMENT YEARS: 2006-07) RUPVAKULA PROPERTIES LTD. 112 KAILASH PLAZA VALLABH BAUG LANE GHATKOPAR MUMBAI-400077 PAN: AABCR7425A APPELLANT V/S INCOME TAX OFFICER 10(2)(3) 4 TH FL. AAYAKAR BHAVAN M K ROAD MUMBAI-400020 .. RESPONDENT ASSESSEE BY : SHRI DEVENDRA H JAIN REVENUE BY : SHRI JITENDRA YADAV O R D E R PER VIJAY PAL RAO JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER DATED 09.12.2009 OF THE CIT(A)-22 FOR THE AS SESSMENT YEAR 2006-07. 2. ONLY GROUND TAKEN BY THE ASSESSEE IN THIS APPEAL READS AS UNDER : THE LEARNED CIT(A) HAS ERRED IN CONFIRMING THE DISALLOWANCE OF CLAIM OF DEDUCTION OF RS.10 61 800/ - U/S 80IB(10). ITA NO. 1018/MUM/2010 (ASSESSMENT YEARS: 2006-07) 2 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE C OMPANY WAS ENGAGED IN THE BUSINESS OF CONSTRUCTION ACTIVIT Y DURING THE YEAR UNDER CONSIDERATION. THE RETURN OF INCOME DECL ARING AN INCOME AT RS.NIL WAS FILED ON 15.11.2006. AFTER PROCESSING THE RETURN U/S 143(1) IT WAS SELECTED FOR SCRUTINY. THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE ATTENDED THE PROCEEDINGS BEFORE THE AO. DURING THE COURSE OF AS SESSMENT PROCEEDINGS THE AO OBSERVED THAT THE ASSESSEE HAD DEVELOPED A HOUSING PROJECT KNOWN AS FLOWER VALLEY CONSISTING OF 11 BUILDINGS IN A LOCALITY KNOWN AS RAMELSHWAR NAGAR SITUATED AT GHATKOPAR (W) MUMBAI. THE ASSE SSEE HAD CLAIMED DEDUCTION U/S 80IB ON WORK-IN-PROGRESS OF 4 BUILDINGS. IN SUPPORT OF ITS CLAIM THE ASSESSEE H AS FILED LETTER BEFORE THE AO. THE AO WAS OF THE VIEW THAT FOR CLA IMING THE DEDUCTION U/S 80IB THE PROJECT SHOULD HAVE BEEN CO MPLETED ON OR BEFORE 31.3.2008. SINCE THE ASSESSEE FAILED T O FULFILL THE CONDITIONS LAID DOWN U/S 80IB(10) HE DISALLOWED TH E CLAIM OF THE ASSESSEE. 4. ON APPEAL THE CIT(A) HAS REJECTED THE CLAIM OF THE ASSESSEE BY HOLDING AS UNDER : 2.4 I HAVE GONE THROUGH THE ASSESSMENT ORDER PERUSED THE SUBMISSIONS MADE BY THE APPELLANT AND ALSO DISCUSSED THE CASE WITH THE A/R OF THE APPELLANT. THE AO HAS DISALLOWED DEDUCTION U/S 80IB(10) ON THE GROUND THAT OUT OF 11 BUILDINGS THE APPELLANT COMPLETED ONLY FOUR BUILDINGS UP TO 31.3.2008 BECAUSE THE APPROVAL OF WORK WAS OBTAINED BY IT FROM LOCAL AUTHORITY BEFORE 1.04.2004. THE ITA NO. 1018/MUM/2010 (ASSESSMENT YEARS: 2006-07) 3 APPELLANT BEFORE THE AO AS WELL AS DURING THE COUR SE OF APPELLATE PROCEEDINGS STATED THAT DEDUCTION WIT H REFERENCE TO THE 4 BUILDINGS SHOULD BE ALLOWED. I N ITS SUPPORT IT HAS RELIED UPON FEW JUDGMENTS. HOWEVER FROM PERUSAL OF THE JUDGMENTS RELIED UPON IT IS NOT ED THAT NONE OF THE JUDGMENTS IS DIRECTLY ON THIS ISSU E AND HENCE NOT RELEVANT. THE APPELLANT HAS ALSO TAK EN AN ALTERNATE ARGUMENT THAT PROVISO TO CLAUSE (B) O F SECTION 80IB(10) RELAXES THE CONDITIONS OF COMPLETI ON OF PROJECT IN CASE OF SRA SCHEME. HOWEVER THE APPELLANT COULD NOT PRODUCE COPY OF ANY SUCH NOTIFICATION UNDER WHICH THE PROJECT OF THE APPELLA NT IS COVERED. ACCORDINGLY IN MY OPINION THE AO WAS JUSTIFIED IN HOLDING THAT NO DEDUCTION U/S 80IB WOU LD BE AVAILABLE TO HE APPELLANT 5. BEFORE US THE LEARNED AR OF THE ASSESSEE HAS RE ITERATED ITS CONTENTIONS AS RAISED BEFORE THE CIT(A) THAT A S PER THE PROVISIONS OF CLAUSES (A) AND (B) OF SECTION 80IB(1 0) THE PROJECT OF THE ASSESSEE WHICH IS APPROVED BY THE SLUM REHABILITATION AUTHORITY IS NOT BOUND BY THE CONDIT ION OF COMPLETION OF THE PROJECT WITHIN A PERIOD OF 4 YE ARS FROM THE DATE OF ITS APPROVAL BY THE LOCAL AUTHORITY. HE HA S FILED THE GAZETTE NOTIFICATION BEARING NO.67/2010-INCOME TAX DATED 3.08.2010 ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES AND SUBMITTED THAT THE PROJECT OF THE ASSESSEE BEING AP PROVED BY THE SLUM REHABILITATION AUTHORITY IS COVERED UNDER THE SCHEME FRAMED BY THE STATE GOVERNMENT AS PER THE P ROVISO TO CLAUSE (A) AND (B) OF THE SECTION 80IB(10). 6. THE LEARNED DR HAS SUBMITTED THAT THE CIRCULAR/G AZETTE NOTIFICATION DATED 03.08.2010 AS RELIED UPON BY THE ASSESSEE ITA NO. 1018/MUM/2010 (ASSESSMENT YEARS: 2006-07) 4 IS SUBSEQUENT TO THE IMPUGNED ORDER OF THE CIT(A). HE HAS FURTHER CONTENDED THAT THE SAID NOTIFICATION HAS CA ME INTO FORCE WITH EFFECT FROM ITS DATE OF PUBLICATION WHICH IS 3 .08.2010 AND NO RETROSPECTIVE EFFECT IS PROVIDED UNDER THE SAID NOTIFICATION. HE HAS FURTHER SUBMITTED THAT EVEN AS PER THE SAID NOTIFICATION CERTAIN CATEGORIES ARE EXCLUDED FROM THE SCHEME AND THE ASSESSEE HAS NOT BROUGHT ON RECORD WHETHER THE ASSE SSEES DEVELOPMENT SCHEME FALLS UNDER ANY OF THE EXCLUDED CATEGORY OF SCHEMES OR NOT. HE HAS RELIED UPON THE ORDERS OF THE LOWER AUTHORITIES. 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND REL EVANT RECORD. AS EVIDENT FROM THE IMPUGNED ORDER OF THE CIT(A) THAT THE CONTENTIONS OF THE ASSESSEE HAVE BEEN TURN ED DOWN BY THE LEARNED CIT(A) ON THE GROUND THAT THE ASSESS EE DID NOT PRODUCE ANY COPY OF SUCH NOTIFICATION IN WHICH THE PROJECT OF THE ASSESSEE IS COVERED. BEFORE US THE ASSESSEE HAS FILED A COPY OF GAZETTE NOTIFICATION DATED 3.08.2010 WHICH IS REPRODUCED BELOW : MINISTRY OF FINANCE (DEPARTMENT OF REVENUE) (CENTRAL BOARD OF DIRECT TAXES) NOTIFICATION NEW DELHI THE 3 RD AUGUST 2010 NO.67/2010-INCOME TAX SO.NO. 1898(E)-IN EXERCISE OF THE POWERS CONFERRED BY THE PROVISO TO CLAUSE (A) AND (B) OF SUB-SECTION 10 OF SECTON 80IB OF THE INCOME TAX ACT 1961 (43 OF ITA NO. 1018/MUM/2010 (ASSESSMENT YEARS: 2006-07) 5 1961) THE BOARD HEREBY NOTIFIES THE SCHEME CONTAINED IN REGULATION 33(10) OF DEVELOPMENT CONTROL REGULATION FOR GREATER MUMBAI 1991 READ WITH THE PROVISIONS OF NOTIFICATION NO. TPB- 43/4080(A)/UD-11(RDP) DATED 3 RD JUNE 1992 AS A SCHEME FOR THE PURPOSES OF THE SAID SECTION SUBJEC T TO THE FOLLOWING CONDITIONS--- (I) SLUM DEVELOPMENT FALLING IN CATEGORY-VII MENTIONED IN NOTIFICATION NO. TPB- 4391/4080(A)/UD-11 (RDP) DATED 3 RD JUNE 1992 SHALL BE EXCLUDED FROM THE SCHEME; II) SLUM DEVELOPMENT FALLING WITHIN CLAUSE 7.7 OF THE APPENDIX IV OF REGULATION 33(10) WHICH PROVIDES FOR JOINT DEVELOPMENT OF SLUM AND NON-SLUM AREAS SHALL BE EXCLUDED FROM THE SCHEME; AND (III) ANY AMENDMENT IN THE SCHEME HEREBY NOTIFIED SHALL BE REQUIRED TO BE RE- NOTIFIED BY THE BOARD. 2. THIS NOTIFICATION SHALL COME INTO FORCE WITH EFFECT FROM THE DATE OF ITS PUBLICATION (F NO.178/37/2006-ITA-I) PADAMSINGH UND.SE C 8. FROM THE ABOVE NOTIFICATION IT IS CLEAR THAT THE SAID NOTIFICATION HAS COME INTO FORCE WITH EFFECT FROM 3 .8.2010. EVEN CERTAIN CATEGORIES OF SLUM DEVELOPMENT ARE EXC LUDED FROM THE SCHEME AS PER THE CONDITIONS PROVIDED UNDE R THE ABOVE NOTIFICATION. ACCORDINGLY IN THE INTEREST O F JUSTICE AND FAIR PLAY WE SET ASIDE THE ORDERS OF THE LOWER AUT HORITIES AND RESTORE THIS ISSUE TO THE RECORD OF THE AO FOR VERI FICATION AND RECONSIDERATION OF THE ISSUE IN THE LIGHT OF THE AB OVE NOTIFICATION AS WELL AS ANY OTHER NOTIFICATIONS IF ANY ISSUED BY THE BOARD UNDER WHICH THE PROJECT OF THE ASESEEE FA LLS AND ITA NO. 1018/MUM/2010 (ASSESSMENT YEARS: 2006-07) 6 THEN DECIDE THE ISSUE AS PER LAW AND AFTER GIVING F AIR AND REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESS EE. 9. THE APPEAL OF THE ASSESSEE IS ALLOWED FOR STATI STICAL PURPOSES. ORDER PRONOUNCED IN OPEN COURT ON 22.12.2010 SD SD (R.S.SYAL) (VIJ AY PAL RAO) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI DATED 22 ND DEC 2010 SRL:211210 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT CONCERNED 4. CIT(A) CONCERNED 5. DR CONCERNED BENCH BY ORDER TRUE COPY ASSTT. REGISTRAR ITAT MUMBAI