New User   Login      
Tax Management India .com TMI - Tax Management India. Com
Extracts
Home List
← Previous Next →

2016 (6) TMI 454 - ITAT MUMBAI

2016 (6) TMI 454 - ITAT MUMBAI - TMI - Validity of the proportionate deduction to the assessee’s, a builder and developer, housing project to meet the stipulated criteria of the maximum built-up area of 1000 sq. ft. per section 80-IB(10)(c) - Held that:- Proportionate deduction on the profits of a housing project which otherwise satisfies the condition of section 80-IB(10), i.e., as referable to residential units having the maximum built-up area as prescribed per clause (c) thereof, would qualif .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nue regards it as unexplained expenditure and, consequently, deems it as income u/s. 69-C. We, accordingly, agree with the ld. CIT(A) that even if regarded as bogus purchase, the same would stand to be disallowed u/s. 37(1), leading to an increase in the assessable profits of the eligible unit. We may here also clarify that had it not been so, the addition of income u/s. 69C, i.e., on account of expenditure not explained as to its source, the same would not be liable to be regarded as the profit .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ated:- 10-6-2016 - Shri Sanjay Arora, AM And Shri Amarjit Singh, JM For the Appellant : Shri S. Pandian For the Respondent : Shri Tarun Ghia ORDER Per Sanjay Arora, A. M. This is an Appeal by the Revenue directed against the Order by the Commissioner of Income Tax (Appeals)-35, Mumbai ( CIT(A) for short) dated 14.2.2014, partly allowing the Assessee s appeal contesting its assessment u/s.143(3) of the Income Tax Act, 1961 ( the Act hereinafter) for the assessment year (A.Y.) 2010-11 vide order d .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

erence to the decision by the Tribunal in the case of Asst. CIT vs. Viswas Promoters (P.) Ltd. [2010] 126 ITD 263 (Chen), advocating literal interpretation of the statute, so that the word project appearing therein, not defined, is to be considered as one single project as approved by the local authority. The assessee, on the other hand, has relied on a series of the decisions by the tribunal, which though have been rendered without considering the decision in Viswas Promoters (P.) Ltd. (supra). .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

oted by the tribunal in Asst. CIT vs. Ekta Sankalp Developers [2015] 152 ITD 805 (Mum), reproducing from the said decision (refer para 31 at pgs. 302-303 of the reports) at para 5 of the order: Section 80-IB(10) allows deduction to the entire project approved by the local authority and not to a part of the project. If the conditions set out in section 80-IB(10) are satisfied, then deduction is allowable on the entire project approved by the local authority and there is no question of allowing de .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

unal per its decision in Ekta Sankalp Developers (supra) has clarified that the condition as to the cap on the built-up area, specified per clause (c) of section 80-IB(10), does not apply to the housing project as a whole, but only qua each residential unit. We may reproduce herein under the relevant part of the said order (refer para 5): 5. We, faced with the decision by the hon ble jurisdictional high court in the case of Brahma Associates (supra), ……….. The provision is a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

aid to hold, so that only such housing project, all the residential units comprising which satisfy the condition of section 80-IB(10)(c), is an eligible project. The word project , clearly mentioned in each of the other clauses, is conspicuous by its absence in clause (c). That is, s. 80- IB(10)(c) represents a condition precedent qua the residential unit comprising the housing project and not qua the project; its language not admitting of such a view. We may though at once clarify that the deci .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

fiscal statutes are to be strictly interpreted, and so are the exemption provisions. It is only once an entity or income, which is the subject matter of exemption, is found, on such construction, to be within the ambit of the provision, that a liberal approach is to be adopted toward effectuating the object of the provision, for which we may refer to Bajaj Tempo Ltd. vs. CIT [1992] 196 ITR 188 (SC) relied upon by the tribunal in the various orders, as far as appears on a reading of their extract .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

o be included by the ld. AR. Again, it is trite law that the benefit of any ambiguity, if any, in the language of the provision, so that two reasonable views are permissible, is to go to the tax payer. We may clarify that our decision, even as sought to be emphasized earlier, despite approving the proportionate deduction, i.e., w.r.t. section 80-IB(10)(c), is, for the reasons afore-stated, thus not in conflict with the decision by the hon ble jurisdictional high court in Brahma Associates (supra .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d hereinbefore, proportionate deduction, as explained therein, on the profits of a housing project which otherwise satisfies the condition of section 80-IB(10), i.e., as referable to residential units having the maximum built-up area as prescribed per clause (c) thereof, would qualify for deduction on a proportionate basis, i.e., to the exclusion of the other residential units. We decide accordingly, disposing Grounds 1 & 2 of the appeal. 4. The only other issue raised by the Revenue is of a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

addition to income to ₹ 3,41,440/-, following the decision in CIT vs. Simit P. Sheth [2013] 356 ITR 451 (Guj). Further, she regarded the same as a disallowance u/s. 37(1). The first question therefore that arises is if the addition is of unexplained expenditure, deemed as income u/s. 69C, or would appropriately be disallowable as an expenditure u/s. 37(1). This is so as it may be appreciated that it is only in the case of the latter that the disallowance would go to swell the profit (from .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version