Ita/487/2023 Of Pr. Commissioner Of Income Tax v. M/S Spr Developers Pvt Ltd

Digitallysigned byBHARATHI SLocation:HIGHCOURT OFKARNATAKA NC: 2024:KHC:39229-DB IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 23 DAY OF SEPTEMBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO. 487 OF 2023 BETWEEN: 1. PR. COMMISSIONER OF INCOME TAX KORAMANGALA BANGALORE KORAMANGALA BANGALORE 2. THE DY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 1(3) BANGALORE CENTRAL CIRCLE 1(3) BANGALORE …APPELLANTS (BY SRI. SANMATHI E I.,ADVOCATE) AND: M/S SPR DEVELOPERS PVT LTD., F-113, 2C AND D CENTRAL CHAMBERS, 2ND FLOOR, 2ND MAIN, GANDHINAGAR BENGALURU-560009 …RESPONDENT (BY SRI. NARENDRA KUMAR JAYANTILAL JAIN.,ADVOCATE) THIS ITA / INCOME TAX APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, PRAYING TO DECIDE THE FOREGOING QUESTION OF LAW AND / OR SUCH OTHER QUESTIONS OF LAW AS MAY BE FORMULATED BY THE HONBLE COURT AS DEEMED FIT AND SET ASIDE THE APPELLATE ORDER DATED 09/02/2022 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, C BENCH, BENGALURU, AS SOUGHT FOR, IN THE RESPONDENT-ASSESSEES CASE, IN APPEAL PROCEEDINGS IN ITA NO.297/BANG/2020 FOR ASSESSMENT YEAR - 2 - NC: 2024:KHC:39229-DB 2008-2009 (ANNEXURE-A) AND GRANT SUCH OTHER RELIEF AS DEEMED FIT, INTEREST OF JUSTICE AND ETC. THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.G.PANDIT and HON'BLE MR JUSTICE C.M. POONACHA ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT) Heard the learned counsel Sri.Sanmathi E.I., for appellants/Revenue and learned counsel Sri Narendra Kumar J. Jain, learned counsel for the respondent/assessee. 2. The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short, ‘the Act’) questioning the correctness and legality of order dated 09.02.2022 passed by the Income Tax Appellate Tribunal, ‘C’ Bench, Bengaluru (for short, ‘Appellate Authority’) in ITA No.297/Bang/2020 for the assessment year 2008-09, raising the following substantial questions of law: “1. Whether on the facts and in the circumstances of the case, the Tribunal’s order is perverse in deleting the addition of on account of disallowance of advance received by assessee from two housing Societies viz., Vijaya Bank Housing Co-operative Society and Syndicate Bank Retired Employee Welfare Association by holding that transaction entered into by the assessee with said parties has not resulted in accrual of income ignoring that assessee itself admitted before CIT(A) that agreed rate of MOU for developing of residential sites by assessee-company included cost of land and as such on date of transfer of land, assessee has accrued deemed profit which has been deeply analyzed by assessing officer? 2. Whether on the facts and in the circumstances of the case, the Tribunal is perverse in nature in not appreciating that assessee is not only confirming party but also received the payments from buyers, transferred the lands to buyers, registered it as well. The subsequent events cannot be taken into consideration as what it matters is upto financial year only? NC: 2024:KHC:39229-DB ITA No. 487 of 2023 3. Whether on the facts and in the circumstances of the case, the Tribunal is perverse in nature in not analyzing the factual matrix of the case which was done by CIT(A) and Assessing authority? 3. Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes. It is also submitted that the aforesaid Circular binds the revenue. NC: 2024:KHC:39229-DB ITA No. 487 of 2023 3. Whether on the facts and in the circumstances of the case, the Tribunal is perverse in nature in not analyzing the factual matrix of the case which was done by CIT(A) and Assessing authority? 3. Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes. It is also submitted that the aforesaid Circular binds the revenue. 4. On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under the aforesaid Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024. 5. In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned counsel for the revenue. However, the question of law is kept open to be adjudicated in an appropriate proceeding. Sd/- (S.G.PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE BS List No.: 1 Sl No.: 46