ACIT- Central Circle-2 Room No.13, 6th Floor, Ashar IT Park,Wagle Estate, Thane(W) Vs. Shri Haresh N. Sanghvi Nikunj House, Manav Mandir, Ambadi Rd. Vasai (W), Dist. Thane-402, 202.
May, 15th 2015
INCOME TAX APPELLATE TRIBUNAL,MUMBAI - H BENCH
Before S/Sh. I P Bansal,Judicial Member & Rajendra,Accountant Member
/.ITA No.7357/Mum/2013, /Assessment Year-2001-02
ACIT- Central Circle-2 Shri Haresh N. Sanghvi
Room No.13, 6th Floor, Nikunj House,
Ashar IT Park,Wagle Estate, Vs Manav Mandir, Ambadi Rd.
Thane(W) Vasai (W), Dist. Thane-402, 202.
PAN: AFCPS 7828 F
( /Appellant) ( / Respondent)
/Assessee by :None
/ Revenue by :Shri Sanjay Punglia-DR
/ Date of Hearing
/ Date of Pronouncement : 14 -05-2015
, 1961 254(1)
Order u/s.254(1)of the Inco me-tax Act,1961(Act)
PER RAJENDRA, AM-
Challenging the order dated 18.09.13 of the CIT(A)-II,Thane,the Assessing Officer(AO) has
raised following Grounds of Appeal:
"01. Whether on the facts and in the circumstances of the case, the CIT(A) was justified in / deleting the
addition of Rs.40,02,600 / - made by the Assessing Officer on account of disallowance of deduction u/s.
801B(10) without appreciating the fact that "the area for shops is admeasuring to 2550sq. ft., thus violating
the conditions of 801B(10) of the 1. T. Act, 1961.
02. Whether on the facts and in the circumstances of the case, the CIT(A) was right in holding that the
Assessing Officer should have decided the issue of deduction u/s. 801B(10) as per the principles laid down
by the Hon'ble ITAT in the case of Brahma Associates (Supra) and not to travel beyond the limits
prescribed by Hon'ble ITAT in the case of Brahma Associates, without appreciating the fact that "the appeal
in the case of Brahma associates is pending before the Hon'ble Supreme Court.
03. The appellant prays that the order of the CIT(A)-II, Thane on the grounds be set aside and that of the
Assessing Officer be restored."
Assessee,an individual,is a builder and developer.He filed hit return of income on 29.10.2001,
declaring total income at Rs.2,29,014/-.He claimed deduction u/s.80IB of the Act, amounting to
Rs.80.64 lakhs.The(AO)completed the assessment u/s. 143(3) of the Act restricting the deduction
to Rs.40.02 lakhs.In the appellate proceedings,the First Appellate Authority(FAA) allowed the
deduction of proportionate basis.The assessee as well as the AO challenged the order of the FAA
before the Tribunal.Vide its order dated 30.03.2010,the Tribunal decided the appeals.
However,the issue relating to deduction u/s.80IB(10)of the Act was restored back to the file of
the AO by the Tribunal,with specific direction and for limited purposes.The AO was directed to
decide the issue in view of the decision of the Tribunal delivered in the case of Brahma
Associates (119 ITD255).In the order passed,on 16.12.2011,u/s.143(3)r.w.s.254(2)of the Act,the
AO again made a disallowance of Rs.40.02 lakhs.
3.Aggrieved by the order of the AO,the assessee preferred an appeal before the First Appellate
Authority(FAA).Before him it was argued that the AO had travelled beyond the directions given
by the Tribunal and hence his order was bad in law.After considering the submissions of the
assessee and the assessment order,the FAA referred to the paragraphs 8 and 8.1 of the order of
the Tribunal dated 30.03.2010.He further observed that the issue relating to deduction u/s.80IB
was to be decided as per the principles laid down by the Tribunal in the case of Brahma
Associates,that the AO was not permitted to travel beyond that.Referring to the case of Brahma
Associates(supra),he held that the commercial area built by the assessee was 2.78% of the total
built up area,that it was less than 10% of prescribed limit mentioned in the order of the Tribunal,
that the assessee was eligible to claim deduction u/s.80IB (10)of the Act.Finally,he allowed the
appeal filed by the assessee.
4.During the course of hearing before us,Departmental Representative(DR)stated that the
matter may be decided on merits.None appeared on behalf of the assessee,as stated earlier.
5. We have perused the material before us.We find that the FAA has followed the judgment
of Hon'ble jurisdictional High Court and has given a categorical finding of fact that the
commercial area built by the assessee was less prescribed limit.Considering the above facts,we
are of the opinion that the order of the FAA does not suffer from any legal infirmity. So,
confirming his order,we decide effective ground against the AO.
As a result,appeal filed by the AO stands dismissed.
Order pronounced in the open court on 14th,May,2015.
( /I P Bansal) ( / RAJENDRA)
/ JUDICIAL MEMBER / ACCOUNTANT MEMBER
/Copy of the Order forwarded to :
1.Appellant / 2. Respondent /
3.The concerned CIT(A)/ , 4.The concerned CIT /
5.DR A Bench, ITAT, Mumbai / , ,.. .
/ BY ORDER,
/ Dy./Asst. Registrar
, /ITAT, Mumbai.