The ACIT, Circle 2, RAJKOT-GUJARAT v. M/s Friends Land Development co, RAJKOT-GUJARAT

ITA 1219/RJT/2010 | 2007-2008
Pronouncement Date: 11-11-2011 | Result: Dismissed

Appeal Details

RSA Number 121924914 RSA 2010
Assessee PAN AAAFF4174E
Bench Rajkot
Appeal Number ITA 1219/RJT/2010
Duration Of Justice 1 year(s) 27 day(s)
Appellant The ACIT, Circle 2, RAJKOT-GUJARAT
Respondent M/s Friends Land Development co, RAJKOT-GUJARAT
Appeal Type Income Tax Appeal
Pronouncement Date 11-11-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted DB
Tribunal Order Date 11-11-2011
Date Of Final Hearing 16-05-2011
Next Hearing Date 16-05-2011
Assessment Year 2007-2008
Appeal Filed On 14-10-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH RAJKOT BEFORE SHRI T.K. SHARMA (JM) AND SHRI A.L. GEHLOT ( AM) I.T.A. NO1219/RJT/2010 (ASSESSMENT YEAR 2007-08) ACIT CIR.2 VS M/S FRIENDS LAND RAJKOT DEVELOPMENT CO PRASHAM 3 RD FLOOR NR. DHARAM CINEMA OPP MOHANBHAI HALL KASTURBA GANDHI ROAD RAJKOT PAN : AAAFF4174E (APPELLANT) (RESPONDENT) C.O. NO.46/RJT/2010 (ARISING OUT OF I.T.A. NO1219/RJT/2010) (ASSESSMENT YEAR 2007-08) M/S FRIENDS LAND DEVELOPMENT CO VS ACIT CIR.2 RAJKOT RAJKOT (CROSS OBJECTOR) (RESPONDENT) DATE OF HEARING : 11-11-2011 DATE OF PRONOUNCEMENT : 11-11-2011 REVENUE BY : SHRI VILAS V SHINDE ASSESSEE BY : SHRI JC RANPURA O R D E R PER T.K. SHARMA (JM) THIS APPEAL BY THE REVENUE AND CROSS OBJECTION BY ASSESSEE ARE AGAINST THE ORDER DATED 01-07-2010 PASSED BY THE CIT(A)-III RAJKOT FOR THE ASSESSMENT YEAR 2007-08. ITA NO.1219/RJT/2010 CO 46/RJT/2010 2 2. THE SOLE ISSUE AGITATED IN THE APPEAL FILED BY T HE REVENUE PERTAINS TO DEDUCTION U/S 80IB(10) AMOUNTING TO RS. 78 31 175 I N RESPECT OF PROFIT ON SALE OF FOUR RESIDENTIAL UNITS WHERE THE BUILT UP AREA IS L ESS THAN 1500 SQ.FT. 3. THE FACTS STATED IN BRIEF ARE THAT IN THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSING OFFICER NOTICED THAT ASSESSEE CLAIMED DEDUCTION U/S 80IB IN RESPECT OF HOUSING PROJECT AMOUNTING TO RS.78 31 175 AND TH AT IN THE PRECEDING ASSESSMENT YEAR ALSO THE ASSESSEE HAD CLAIMED SIMIL AR DEDUCTION IN RESPECT OF THE SAME PROJECT. AFTER HEARING THE ASSESSEE THE ASSESSING OFFICER HELD THAT ALL THE POINTS MADE BY THE ASSESSEE HAS BEEN THOROUGHLY EXAMINED IN THE COURSE OF ASSESSMENT FOR THE PRECEDING ASSESSMENT YEAR. THE CRUX OF THE MATTER IS THAT THEE IS NO CONTROVERSY IN RESPECT OF THE FACT THAT THE BUILT UP AREA OF THE INDIVIDUAL RESIDENTIAL UNIT IN THE APPROVED PROJECT ACCORDING TO WHICH CONSTRUCTION HAS BEEN CARRIED OUT EXCEEDED 1500 SQ.FT. IN RESPECT OF MANY RESIDENTIAL UNITS. FURTHER THE ASSESSEES EXPLANATION REGARDING ORIGINAL PLAN HAS ALSO NO MERIT IN VIEW OF THE FACT THAT THE ASSESSEE HAS CONSTRUCTED PROJECT AS P ER THE REVISED PLAN AND THE ORIGINAL PLAN LOST ITS MEANING AS THE SAME WAS REVI SED BY THE COMPETENT AUTHORITY. FURTHER THE ASSESSEES SUBMISSION REGA RDING SEPARATE BILL FOR ADDITIONAL WORK HAS ALSO NO MERIT IN VIEW OF THE FA CT THAT THE DEDUCTION U/S 80IB IS AVAILABLE TO THE PROJECT IN WHICH THE BUILT UP AREA OF INDIVIDUAL RESIDENTIAL UNIT DOES NOT EXCEED 1500 SQ.FT. IN CITY OTHER THAN DELH I OR MUMBAI. THERE IS NO PROVISION IN THE ACT THAT THE CONDITION CAN BE VIOL ATED BY INTRODUCING THE CONCEPT OF S3EPARATE BILL. IN THE INSTANT CASE THE ASSESS EE HAS DEVELOPED A PROJECT IN WHICH THE BUILT UP AREA OF INDIVIDUAL BUNGALOWS IN MANY CASES EXCEEDED 1500 ITA NO.1219/RJT/2010 CO 46/RJT/2010 3 SQ.FT. BY DEVELOPING COMMERCIAL SPACE WHICH EXCEE DED 17% OF TOTAL AREA OF APPROVED PROJECT THE ASSESSEE HAS VIOLATED THE CON DITION F SECTION 80IB(10) THEREFORE THE ASSESSEES PROJECT WAS NOT FOUND ELI GIBLE FOR DEDUCTION U/S 80IB. ACCORDINGLY THE ASSESSING OFFICER DISALLOWED THE C LAIM U/S 80IB OF THE ACT TO THE TUNE OF RS.78 31 175/- AND ADDED THE SAME TO THE TO TAL INCOME. 4. THE ASSESSEE PREFERRED APPEAL BEFORE CIT(A) AND SUBMITTED THAT THE ISSUE STOOD COVERED BY THE ORDER OF ITAT IN FAVOUR OF ASS ESSEE FOR THE ASSESSMENT YEAR 2005-06 VIDE ORDER DATED 19-03-2010 IN ITA NO .86/R/09 & ITA NO.91/R/09 AND ITA NO.1085/RJT/2009 & 1086/JT/2009 FOR THE ASS ESSMENT YEAR 2005-06 & VIDE ORDER DATED 30-06-2010 IN ITA NO.1086/RJT/2009 FOR THE ASSESSMENT YEAR 2006-07 WHEREIN IT HAS BEEN HELD THAT DEDUCTION U/S 80IB(10) IN RESPECT OF PROFIT ON SALE OF 4 RESIDENTIAL UNITS WHERE THE BUILT UP A REA IS LESS THAN 1500 SQ.FT. IS ALLOWABLE. THE SUBMISSION OF THE ASSESSEE FOUND FA VOUR WITH THE CIT(A) WHO DIRECTED THE ASSESSING OFFICER TO ALLOW THE CLAIM O F THE ASSESSEE IN RESPECT OF RESIDENTIAL UNITS WHICH HAVE BUILT UP AREA OF LESS THAN 1500 SQ.FT.. HOWEVER THE CLAIM OF THE ASSESSEE THAT THE DEDUCTION U/S 80IB(1 0) IS ALLOWABLE IN ENTIRETY DID NOT FIND FAVOUR WITH THE CIT(A). AGGRIEVED THE RE VENUE IS IN APPEAL BEFORE THE TRIBUNAL AND THE ASSESSEE IS IN CROSS OBJECTION. 5. SHRI VILAS V SHINDE APPEARED ON BEHALF OF THE RE VENUE AND SHRI JC RANPURA APPEARED ON BEHALF OF THE ASSESSEE. ITA NO.1219/RJT/2010 CO 46/RJT/2010 4 6. HAVING HEARD THE PARTIES AND ON PERUSAL OF THE ORDERS OF AUTHORITIES BELOW WE FIND THAT THE ITAT RAJKOT BENCH IN ASSESSEES O WN CASE FOR THE ASSESSMENT YEARS 2005-06 AND 2006-07 VIDE ORDERS CITED SUPRA H AS ALREADY HELD THAT DEDUCTION U/S 80IB(10) IN RESPECT OF PROFIT ON SALE OF FOUR RESIDENTIAL UNITS WHERE THE BUILT UP AREA IS LESS THAN 1500 SQ.FT. IS ALLOW ABLE. THE LD.CIT(A) FOLLOWED THE DECISION OF THE ITAT RAJKOT BENCH IN ASSESSEES OW N CASE FOR THE ASSESSMENT YEARS 2005-06 AND 2006-07 AND ALLOWED THE APPEAL OF THE ASSESSEE. IN THE CIRCUMSTANCES CONSISTENT WITH THE VIEW ALREADY TAK EN BY THE TRIBUNAL VIDE ABOVE CITED ORDERS WE HAVE TO NECESSARILY UPHOLD THE ORD ER OF THE CIT(A). THEREFORE WE CONFIRM THE ORDER OF CIT(A). 7. WITH REGARD TO THE CROSS OBJECTION SINCE WE HAV E UPHELD THE ORDER OF THE CIT(A) IN ITS ENTIRETY THE CROSS OBJECTION FILED B Y THE ASSESSEE HAS TO FAIL. NEEDLESS TO MENTION THE TRIBUNAL FOR THE ASSESSMEN T YEAR 2005-06 AND 2006-07 HAS ALREADY REJECTED THE ASSESSEES CONTENTION THAT IT IS ELIGIBLE FOR THE DEDUCTION ON THE ENTIRE PROFIT. THEREFORE WE DISMISS THE CR OSS OBJECTION. 8. IN THE RESULT THE APPEAL FILED BY THE REVENUE I S DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS ALSO DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING. SD/- SD/- (A.L. GEHLOT) (T.K. SHARMA) ACCOUNTANT MEMBER JUDICIAL MEMBER RAJKOT DT : 11 TH NOVEMBER 2011 PK/- ITA NO.1219/RJT/2010 CO 46/RJT/2010 5 COPY TO: 1. ASSESSEE 2. REVENUE 3. THE CIT(A)-III RAJKOT 4. THE CIT-II RAJKOT 5. THE DR I.T.A.T. RAJKOT (TRUE COPY) BY ORDER ASSTT.REGISTRAR ITAT RAJKOT