TMI Blog2014 (12) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... x Act are dependent upon the conditions laid down under the provisions of the Act and there are requisite formalities which are required to be done as per the law - once these conditions are fulfilled, the assessee is entitled for statutory deduction or claim to which he is entitled to - Mere consent or acquiescence by the assessee cannot take away the otherwise a legitimate claim to which he is entitled to - an admission or acquiescence cannot be a foundation for assessment where the income is returned under erroneous impression or misconception of law - even though the assessee had surrendered its claim before the AO – relying upon CIT vs Sheth Developers (P) Ltd. [2012 (8) TMI 159 - BOMBAY HIGH COURT] - the assessee surrendered the income, whose only source, was the business of the assessee - the claim of the assessee to include ₹ 95,00,000/- in the computation of deduction u/s 80IB(10) is in accordance with law and must be allowed. Whether the statement given oath u/s 133A is binding and cannot be retracted – Held that:- Statement given u/s 133A is not on oath - the statement made by the managing partner to not to include the amount of ₹ 95,00,000/- in the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ister concerns u/s 133A of the Income Tax Act, 1961, on 11.10.2005 wherein one of the partners offered ₹ 2,91,00,000/- as additional income for the group as a whole. In so far as the assessee was concerned, there was a disclosure of ₹ 95,00,000/-. The original return was accepted u/s 143(1), but since there was a disclosure of ₹ 95,00,000/-, the AO initiated reassessment proceeding and issued notice u/s 148. In the return in response to notice u/s 148, the assessee did not show the income offered separately, but included the same for the claim of deduction u/s 80IB(10), which was quantified at ₹ 2,96,77,083/- by the assessee. 5. The AO, while framing the assessment sought the assessee s submission with regard to allowability of deduction claimed u/s 80IB(10) and whether the amount offered for taxation at ₹ 95,00,000/- could be included into the quantifying amount for the computation of deduction u/s 80IB(10). 6. The assessee, in response to the query raised by the AO, responded that the assessee commenced its project for housing development on 23.03.2003 as per commencement certificate dated 03.12.2002. As per the details provided by the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... declared at the time of survey and also because it was undertaken by the managing partner of the assessee firm, that the declared amount shall not be included for the claim of deduction u/s 80IB(10). By including the surrendered sum in the qualifying amount for the claim of deduction u/s 80IB(10), according to the AO, was retraction of the amount so offered at the time of survey u/s 133A. 10. Aggrieved, the assessee approached the CIT(A), before whom, the facts and submissions made before the AO were reiterated. The CIT(A), on considering the submissions of the assessee and the order of the AO observed that for the claim of deduction u/s 80IB(10), individual plot size for individual building to be in excess of 1 acre is not necessary. He observed that in the instant case building 1 and 2 are constructed on one plot which measures 1.10 acres. This will not disentitle the assessee from the claim of deduction and, therefore, the AO was unjustified to deny the deduction. 11. On the issue of joining/amalgamation of flat area, which exceeded 1000 sq. ft., was an issue which first came in assessment year 2005-06, wherein the CIT(A), considering the evidence found in the same survey ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uction u/s 80IB(10). The CIT(A) observed, I have considered the submissions of the representative and the stand taken by the AO. Admittedly, the appellant offered additional income of ₹ 95 lacs for this assessment year and the Managing partner further stated that the appellant would not be entitled to deduction u/s 80IB(10) in respect of this additional income as the same was received for providing extra amenities and alternations after giving possession of flats. This is the basis on which the A.O. denied deduction u/s 801B(10). As contented by the representative, the allowance of deduction is to be decided based on the materials gathered at the time of survey and not merely on the basis of statement recorded. at the time of survey. A perusal of para 13.3(ii) shows that the amount was received on 13.12.2004 and 10.12.2004 which is before the date of occupation certificate. Further the appellant has admitted income of only ₹ 4,72,000/- from A wing and the major income of ₹ 1,97,04,583/- is from B wing of Building No. 1. The appellant has submitted occupation certificate dated 23.12.2005 respect of B wing. As on the date of survey, occupation certificate itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arguments of the contesting parties. Since the surrender of additional income was made in other cases and the issues of joining the flats to make them bigger flats exceeding 1000 sq. ft. were the subject matter of other assessees and other years of the assessee, the details were called for. The AR submitted the details before the Bench and on the basis of such orders in the case of Vandana Enterprises and other years in the case of the assessee, we find that the coordinate Benches had been taking consistent stand and allowed the deduction, u/s 80IB(10) on identical facts and allowed the deduction, as claimed. The relevant portion of the order of the coordinate Bench in the case of the assessee has been reproduced earlier in this order. 19. Respectfully following the decision, based on identical facts, as in the instant case, we do not find any reason to deviate from the decision taken in assessment year 2005-06. We, therefore, hold that the assessee is eligible for the claim of deduction u/s 80IB(10). 20. Upon holding this, we are still encountered with two issues, i.e. whether there was a retraction of the statement given by the managing partner to not to include the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on facts and material on record and conditions relevant for claiming such deduction stood fulfilled. 23. Hon ble Bombay High Court in the case of CIT vs Sheth Developers (P) Ltd, reported in 254 CTR 127 (Bom) (copy filed before us), held, Explanation to sub-s (1) of s 158BB was amended by the Finance Act, 2002 with retrospective effect from 1st July, 1995. Prior to the amendment, according to the Explanation, the total income or loss was to be computed in accordance with Chapter IV. Consequent to the amendment by Finance Act, 2002 with retrospective effect from 1st July, 1995, the total income or loss has to be computed in accordance with the provisions of this Act. Consequently, w.e.f. 1st July, 1995 the total income/loss for the block period has to be computed 3n accordance with the provisions of the Act and the same would include Chapter V/-A. Sec 80-lB is a part of Chapter VI-A. In view of the above, while computing the undisclosed income for the block period the respondent assessee is entitled to claim deduction from its income under s. 80-lB. It is not the case of the Revenue that the money found in possession of the assessee could not be explained and/or its source c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decision from Hon ble jurisdiction High Court in the case of CIT vs Sheth Developers (P.) Ltd. 254 CTR 127 (Bom) has been discussed. It is also noted that survey action u/s 133A of the Act was carried out on 11/10/2005, wherein statement of Jagat V. Shah, managing partner of the assessee firm was recorded on 11/10/2005. The assessee received some part of sale consideration in cash on the request of the customers and in reply to question no. 14 he specifically tendered that the impugned amounts were transacted in cash and thus a voluntary disclosure of additional income of ₹ 2.91 crores was made over and above the normal business income. The break up of the said disclosure is as under:- Name of the firm Ass. Year. Amount (Rs.) M/s Vandana Builders 2005-06 60,00,000 2006-07 15,00,000 M/s Vandana Enterprises 2005-06 75,00,000 2006-07 30,00,000 M/s Vandana Properties 2006-0 ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
