TMI Blog2017 (10) TMI 726X X X X Extracts X X X X X X X X Extracts X X X X ..... livery of the completed sites cannot be either determinative of the facts or need to mean that the agreements entered into by the assessee society is a composite contract and amounts to a works contract. Thus, in our considered opinion, the case of the assessee is squarely covered by the decisions of the Hon’ble Karnataka High Court in the case of Karnataka State Judicial Department Employees House Building Co-operative Society Ltd., (2010 (3) TMI 1211 - KARNATAKA HIGH COURT). We, therefore, uphold the impugned orders of the ld CIT(A) deleting the demands raised by the AO u/s 201(1) and 201(1A) of the Act. - Decided against revenue - ITA Nos.246 to 259/Bang/2017 - - - Dated:- 11-10-2017 - SHRI N.V VASUDEVAN, JUDICIAL MEMBER AND SHRI JASON P BOAZ, ACCOUNTANT MEMBER For The Appellant : Shri L.V Bhaskar Reddy, Addl. CIT For The Respondent : Shri G Venktesh, Advocate ORDER PER BENCH : These are a bunch of fourteen appeals by the Revenue, directed against the order Commissioner of Income-tax (Appeals) 13, Bangalore dated 28/11/2016 for the assessment years 2008-09 to 2014-15. Since common issues are involved, these appeals were heard together and ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15, the assessee preferred appeals before the CIT(A)-13, Bangalore. The ld CIT(A) allowed the aforesaid appeals filed by the assessee for asst. years 2008-09 to 2014-15 vide a common order dated 28/11/2016 holding that the assessee was not liable to deduct tax at source on the payments it made to developers/contracts as the provisions of sec. 194C of the Act were not attracted in the case on hand.. 3.1 Revenue, being aggrieved by the orders of the CIT(A)-13, Bangalore dated 28/11/2016 for asst. years 2008-09 to 2014-15, has filed these appeals before the Tribunal raising the following common grounds for the aforesaid asst. years. 1 . The order of CIT ( A ) is opposed to the facts and nature of the case on hand . 4 2 . The Id . CIT ( A ) erred in holding that the assessee was not required to deduct tax at source u / s . 194C from the payments made to developer . 3 The Ld . CIT ( A ) erred in deleting the demand u / s . 201 ( 1 ) and 201 ( 1A ). 4 . The Id . CIT ( A ) ought to have considered the fact that as per the assessee's agreement with the developer the works to be carried out like for pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acquiring land, forming residential layouts thereon with attendant civil works and therefore, since it amounts to a composite works contract the provisions of section 194C of the Act was applicable. According to the ld DR, the judgment of the Hon ble Karnataka High Court relied on by the ld CIT(A) (Supra) in distinguishable as in that case, the contract for purchase of sites was not a composite contract. It is further submitted that the two decisions of the Tribunal relied upon by the ld CIT(A) have not been accepted by the Department and the same are being contested in further appeal by Revenue. 3.4 Per contra, the ld AR of the assessee supported the impugned orders of the ld CIT(A), and submitted that there is no error therein as the issue in dispute is covered by the orders of the co-ordinate benches of this tribunal which were relied on by the assessee i.e (i) Kautilya House Building Co-operative Society Ltd. (Supra); (ii) Railway House Building Co-operative Society Ltd., in ITA Nos.1339, 1340 1344/Bang/2015 and 1343/Bang/2016 and (iii) Telecom Employees Co-operative Housing Society Ltd., in ITA Nos:2274 to 2280/Bang/2016. It was prayed that in the light of the above judi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ential layout in the schedule lands to the First Party after obtaining the requisite approvals from various authorities for it and after completing all the requisite infrastructure works, such as roads with asphalt, electric lines, drainage, water lines, sewerage connection in accordance with the BDA norms before the sites could be utilized for allotment to the members of First Party . 4 . The First Party accepting the offer made by the second party agreed to buy the developed sites with all the facilities cited above to be formed in the Schedule lands from the Second Party subject to the following terms and conditions accordingly entered into this Agreement witenessing as follows : ( a ) The parties hereby agree that the Second Party shall purchase and register the schedule property in its name in phased manner out of the payment made by the First Party as advance and then the Second Party shall deposit original title deeds with the First party towards security for the payment made by the First Party to the second party for successful completion of the project in accordance with the recitals of this agreement . ( b ) The parties hereby agree that after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er and laying of all distribution lines with C . I . pipes and control valves with covers along the Main and Cross Roads in the layout as per the plan . ( 5 ) Under - ground Drainage facility with requisite number of manholes and septic tanks for disposal of sewage as per the BWSSB norms . ( 6 ) Electricity Works including erection of cement poles, fixing of street lights on roads and installation of transformers as per the KPTCL norms . ( 7 ) Construction of Overhead Tank and sump requisite capacity to fulfill the requirement of water for the layout . ( 8 ) Demarcation of sites as per the specifications of the First party and as per the approved plan and putting the site nos . in each site . ( 9 ) Installation of layout key plan board and direction boards indicating the Cross Roads and Main Roads along with the site numbers coming in the respective roads as per the approved plan . ( 10 ) Planting of Road - side trees . ( 11 ) Putting the society's name board in the layout ( 12 ) Fencing the park and CA sites . 13 ) Release of sites form the competent authorities, if necessary ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding upon the tax payable by him . 3.5.5 In the aforesaid case decided by the Hon ble Karnataka High Court (Supra), the co-ordinate bench of this Tribunal had rendered the following finding:- . the agreement between Sh . Lakshman, and Karnataka State . Judicial Department Employees House Building Co - operative Society begins to operate only after the layout is formed and so can never be construed as an agreement in the nature of works contract . A contractor is one who I undertakes to do a particular work - for a price . No such contract is envisaged in this agreement . This agreement envisages purchase of specified intermediate sites at a price after Sri Lakshman completes the job of formation of a layout either infti1 or in part . We accordingly hold that the assessee was not required to deduct tax in this regard . 3.5.6 We find that Revenue s contention that the aforesaid judgment of the Hon ble Karnataka High Court in the case of Karnataka State Judicial Department Employees House Building Co-operative Society Ltd., (Supra) is distinguishable from the case on hand has also been considered on similar fact situation, by co-ordinate benche ..... X X X X Extracts X X X X X X X X Extracts X X X X
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