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2015 (3) TMI 880 - AT - Income TaxDeduction u/s. 80IB(10) - Sub projects namely Brahmputra, kaveri, Amravati and Damodar which are the part of main project i.e. Shipra Riviera in which the development and construction work was started before Ist October, 1998 and assessee did not fulfill the requisite conditions as laid down in sec. 80IB(10) as held by AO - separate project v/s whole project - CIT(A) allowed the claim - Held that:- In the present assessment year under consideration as well as, no reason to assume that commencement of development and construction of the housing projects was started prior to 01.10.1998 for the purpose of declining the claim of deduction under sec. 80IA(4F)/80IB(10) of the Income-tax Act, 1961, has been shown by the Revenue and keeping in mind the fact that contract for construction of all the four projects of Shipra Riviera was awarded only after 30.9.1998, we are of the view that the issue is fully covered by the above decisions of the ITAT for the assessment years 2000-01 and 2001-02 which has also been followed by the ITAT in the case of assessee itself for the assessment years 2004-05 and 2006-07. Respectfully following the same, we uphold the First Appellate Order in this regard with this finding that the Learned CIT(Appeals) was justified in directing the Assessing Officer to delete the disallowance of ₹ 1,19,04,619 which was made by the Assessing Officer while denying the claimed deduction under section 80-IB of the Act in respect of the above stated four projects. - Decided in favour of assessee. Disallowance under the head ‘charity and donations’, prior period expenses and interest on TDS (UPTT) - Held that:- CIT(Appeals) has simply upheld the addition on the basis of First Appellate Order for the assessment year 2004-05 without discussing the related facts on the issue for the assessment year under consideration, we set aside the matter to the file of the Assessing Officer to decide the issue afresh noting down the facts of the case for the assessment year under consideration by passing a speaking order. - Decided in favour of assessee for statistical purposes. Disallowance of expenses claimed on repair, maintenance, travelling, conveyance, stationery etc.- Held that:- Assessing Officer has made the disallowance considering the element of non-business expenditure as well as self-made vouchers on record in a few instances. The ITAT in the assessment year 2004-05 has deleted this addition with this finding that on the basis of general observations ad hoc disallowance cannot be made in absence of even a single specific instance of non-verifiablity of the expenses or expenses having been incurred for nonbusiness purposes. Following this decision of the ITAT for the assessment year 2004-05, we direct the Assessing Officer to delete the addition in question. - Decided in favour of assessee Addition as non-business expenses - AR submitted that the amount is wrong and the same has been rectified by the Learned CIT(Appeals) vide its order dated 09.12.2011 under sec. 154 substituting the correct amount as ₹ 2,54,750 as added by the Assessing Officer - Held that:- We find that the Assessing Officer has made the disallowance of ₹ 2,54,750 debited in P & L account as membership fee on the basis that the amount is not expended wholly and exclusively for the purpose of business and cannot be even equated with the business promotion or similar such expenses. The ITAT in the assessment year 2004-05 has deleted similar addition with the finding that it was for the business purpose of the assessee. The membership fee was paid to National Real Estates Development Council which was established in the year 1998 under the aegis of Union Ministry of Housing & Urban Poverty Alleviation, Government of India for the development and promotion of housing and real estates sector in India. The ITAT held that since the assessee is in the business of housing development and real estates, this subscription is relating to business purpose of the assessee. Following the same, we direct the Assessing Officer to delete the addition. The ground No. 5 is accordingly allowed. - Decided in favour of assessee Depreciation on car disallowed - AO has made this disallowance at 10% of the claimed depreciation account of possible personal use by the directors of the company - CIT(Appeals) has upheld the same on the basis of his predecessor order in this regard for the assessment year 2004-05 - Held that:- The ITAT in the assessment year 2004-05 has deleted the disallowance on the basis that the depreciation was claimed as per the schedule attached with the balance sheet thus even if there is personal use of cars by the directors of the assessee company, addition can be made in the hands of the employees directors on account of perquisites but no disallowance can be made in the hands of company by alleging that there is personal use of cars. Respectfully following this decision, we direct the Assessing Officer to delete the addition - Decided in favour of assessee.
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