Commissioner Of Income Tax v. Shri M.r.rathindran

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED: 22.07.2015 C O R A M THE HONOURABLE MR.JUSTICE R.SUDHAKARandTHE HONOURABLE MS.JUSTICE K.B.K.VASUKI Commissioner of Income TaxNo.63, Raced Course RoadCoimbatore ...Appellant/AppellantVs Shri M.R.RathindranNo.3/570, Gandhi NagarK.VadamaduraiCoimbatore-641 017PAN:AGQ PR 5812 F... Respondent/Respondent Tax Case (Appeal) filed under Section 260A of the Income Tax Act,1961 against the order of the Income Tax Appellate Tribunal Madras“C” Bench dated 27[th] January 2015 in ITA.No.441/Mds/2013. against the Order of the Commissioner of Income Tax(Appeals)-I,Coimbatore dated 5.12.2012 in Appeal NO.314/11-12 and (Delivered by R.SUDHAKAR, J.) This appeal by the Revenue is directed against the order passedby the Income Tax Appellate Tribunal Madras “C” Bench dated 27[th]January 2015 in ITA.No.441/Mds/2013 for the assessment year 2005-06. 2. The Revenue seeks admission of the Tax Case (Appeal) byraising the following substantial questions of law:- “1.Whether on the facts and circumstances of the case, theAppellate Tribunal is correct in law in deciding that the undertakingof the assessee is entitled for deduction u/s.80IB(10) of the Actwherein residential units were constructed measuring more than 1500 https://hcservices.ecourts.gov.in/hcservices/ sqft on pro-rata basis ? 2. Whether on the facts and circumstances of the case, theAppellate Tribunal was right in allowing proportionate deductionu/s.80IB(10) when there is no provision for allowing proportionatededuction in section 80IB of the Act ? 3. Whether on the facts and circumstance of the case, theAppellate Tribunal was right in allowing deduction u/s.80IB(10) whenthey obtained the Planning permission only from local PanchayatAuthority and completion certificate from Panchayat President, whichare contravention of clause (1) of Section 80IB(10) of the Act?” 3. The facts in a nutshell are as under:- The assessee is the Proprietor of M/s.Sri Vari Builders, engagedin construction of houses. The assessee had filed returns of incomefor the assessment years 2000-01 to 2005-06 together on 12.09.2008belatedly with delay of four to five years. In the returns ofincome, the assessee has claimed huge amounts as deduction underSection 80IB(10). A survey under Section 133A was conducted in thiscase on 23.09.2009 and at the time of survey, it was observed thatthe assessee has not satisfied the conditions stipulated underSection 80IB(10) of the Income Tax Act, 1961 to be eligible for thededuction. Notice under Section 148 of the Act was issued on15.12.2010 and in response to that, the assessee filed a fresh returnclaiming Rs.1,82,90,595/- as deduction under Section 80IB(10) of theAct. Subsequently, notice under Section 143(2) of the Act was issuedand after due process, the assessment for the year underconsideration was completed under Section 143(3) read with Section147 of the Act by denying the claim of the assessee made underSection 80IB(10) of the Act. Aggrieved by the same, the assesseefiled appeal before the Commissioner of Income Tax (Appeals). 4. The Commissioner of Income Tax (Appeals), by following thedecision in assessee's own case for the assessment years 2003-04 and2004-05, directed the Assessing Officer to allow the claim of theassessee under Section 80IB(10) of the Act. On being aggrieved bythis order, the Revenue filed appeal before the Income Tax AppellateTribunal. 4. The Commissioner of Income Tax (Appeals), by following thedecision in assessee's own case for the assessment years 2003-04 and2004-05, directed the Assessing Officer to allow the claim of theassessee under Section 80IB(10) of the Act. On being aggrieved bythis order, the Revenue filed appeal before the Income Tax AppellateTribunal. 5. The Income Tax Appellate Tribunal, perused the closing stockof land as on 31.03.2005 and other particulars filed by the assesseeand the findings of the Commissioner of Income Tax (Appeals) in thisregard and pointed out that this aspect requires detail examinationas to on what basis the revised profit and loss account was submittedand considered for arriving the assessed income of Rs.3,19,50,557/- ,when as per the original audited Profit and Loss Account, the closingstock as on 31.03.2005 was shown as NIL; as to how the suppressedclosing stock was worked out to Rs.33,12,500/-; that the sale ofvacant sites have been omitted to be accounted. As such, the Income https://hcservices.ecourts.gov.in/hcservices/ Tax Appellate Tribunal set aside the order passed by the CIT(Appeals)on the said issue and remitted the matter back to the AssessingOfficer to examine with evidence on project-wise sale of sites andmaterial facts and to decide the issue de novo. Aggrieved by thesaid order, the Revenue is with the present Tax Case (Appeal). 6. When the matter was taken up, learned counsel appearing oneither side submitted that the issue raised in this case as towhether the assessee is entitled for deduction under Section 80IB(10)of the Income Tax has already been decided by this Court in T.C.(A).Nos.1014 of 2009, 857 of 2010 and 190 to 192 of 2012 and W.A.No.471of 2010 dated 02.11.2012 in the case of M/s.Viswas Promoters PrivateLimited V. The Assistant Commissioner of Income Tax, reported in[2013] 29 taxmann.com 19(Madras) in favour of the assessee andagainst the Revenue holding that the assessee is entitled to theclaim of deduction but to the extent of each of the blocks satisfyingthe conditions under Section 80-IB(10) on a proportionate basis. 7. Accordingly, following the above-said decision in the case ofM/s.Viswas Promoters Private Limited V. The Assistant Commissioner ofIncome Tax (supra), the above Tax Case (Appeal) is dismissed and theorder of the Tribunal stands confirmed. No costs. Sd/- Assistant Registrar True Copy Sub Assistant Registrar nvsriTo1.The Commissioner of Income Tax No.63, Raced Course Road Coimbatore. 2.The Income Tax Officer, Ward II(3), Coimbatore3.The Commissioner of Income Tax(Appeals)-I Coimbatore. 4.The Assistant Registrar,The Income Tax Appellate Tribunal, 'C' Bench, Chennai.IIIrd Floor, Rajaji Bhavan,Besant Nagar, Chennai 600 090. ug(co)pmk.20.8.2015