TMI Blog2012 (9) TMI 1048X X X X Extracts X X X X X X X X Extracts X X X X ..... case for the assessment years 2001-02, 2003-04. The copy of the said order is filed before us. 4. The learned DR also confirmed that the issue is covered against the assessee. 5. Having heard both the parties and having considered the rival contentions and the relevant materials on record, we find that the Tribunal at para 3.16 to 3.18 has held as under : 3.16 The issue before us has been considered by the Karnataka High Court in the case of Mamta Enterprises (supra). The question of law referred to the jurisdictional High Court was as under:- Whether on the facts and in the circumstances of the case, the Appellate Tribunal is right in law in holding that the payment of the compounding fees is not a penalty for infraction of law and hence allowable . At page 361, the Hon ble High Court has referred to the order issued in the case of Mamta Enterprises. In the instant case also, the order which has been issued by the Commissioner while granting occupancy certificate, is that the assessee has paid the compounding fine. Before the Hon ble High Court it was contended by the appellant s counsel that construction of a building in violation of the sanctioned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... wever, clause (b) of section 483 of the Corporation Act empowers the Commissioner to compound any offence committed in breach of the provisions of the Act, rules, byelaws or regulations which may by rules made by the Government be declared compoundable. Therefore, from the scheme of the several provisions in the Act referred to above, it is clear that nobody can put up any new construction or proceed to reconstruct the existing building without there being a sanctioned plan or permission granted by the Commissioner on that behalf, the putting up any construction without there being a sanctioned plan is made an offence under the Act and it is treated as an act prohibited by law. No doubt, as noticed by us earlier, clause (b) of section 483 of the Corporation Act empowers the Commissioner to compound the offence. Byelaw 5.6 framed by the Corporation in exercise of the power conferred under it under section 428 of the Act enables the Commissioner to set out the circumstances under which he could compound an offence. It is useful to refer to the said byelaw which reads as hereunder: 5.6.1 Whether any construction is in violation/deviation of the sanctioned plan, the Commissione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o whether the Tribunal could make a comment on the decision of the High Court and having done so, whether judicial propriety permitted the Tribunal to ignore the decision and take its own view. All these issues need to be decided by the High Court in a reference under section 256(1) ibid . 3.18 Hence, when a similar issue has been decided by the jurisdictional High Court, then that decision is binding on us and that is to be followed in order to abide with the judicial discipline. Hence, we hold that the amounts paid as compounding fine for regularization of violation/ deviation are not allowable expenditure. We also uphold the finding of the learned CIT(A) that in case the compounding fine/penalty paid for regularization of violation/deviation is ultimately held as fees then provision of section 43B will be applicable and the amount will be deductible as per the provisions of section 43B. This disposes of appeal for the assessment year 2001- 02 . 6. Respectfully following the decision of the co-ordinate bench which is in the consonance with the decision of the jurisdictional High Court, this appeal of the assessee is dismissed. 7. In this appeal, the Reven ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gnizing revenues in respect of real estate activities. When the issue finally reached before the Tribunal, the Hon ble Tribunal in its finding cited supra directed the AO to accept the project completion method of accounting for the year under reference . (iv) Extensively quoting the Hon ble Tribunal s finding referred supra, the ld. CIT(A) had, in his impugned order under dispute (for the AY 2006-07), observed thus 3.3 ..Thus, the finding is limited to assessment year 2005-06, however, in the assessment year under appeal, the assessing officer has treated that income offered by the appellant to the above extent on the basis of the project completion method under the head income from other sources on protective basis. Considering the fact that the said addition has been deleted by the Hon ble ITAT in assessment year 2005- 06, the income has to be assessed on substantive basis in assessment year 2006-07 as offered by the appellant. After deletion of the income by the ITAT, in assessment year 2005-06, there is no question of double taxation in the assessment year 2006-07 where the appellant himself (sic) itself offered the income for taxation. In view o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... entical issue had cropped up before the Hon ble Tribunal for the AY 2005-06 in the assessee s own case wherein the Hon ble Tribunal had, after hearing the arguments of rival parties, analyzing the issue at length, extensively quoting, chiefly, the rulings of the Hon ble Apex Court as well as the jurisdictional Hon bnle High Court in a number of cases on a similar issue, observed thus 5.1 We had discussed this issue while considering the ratio of law as laid down by the Hon ble Apex Court in the case of Sultan Brothers (surpa). The Hon ble Apex Court has held that there should be no consideration of primary and secondary lettings in constructing the section 12(4) of 1922, which has analogy to 56(iii) of I.T Act of 1961. In this case, the letting of building is along with letting machinery, plant or furniture required for ancillaries services and, therefore, we hold that the alternative plea of the appellant that in case the income is not to be assessed under the head income from the house property then it is required to be assessed under the head income from other sources . This is without prejudice to our basic finding that in the instant case, the income from Mall is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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