AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2015 (1) TMI 650
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....come-tax authorities in denying allowance of depreciation in respect of Honda Motor Car @50%. 3. In so far as the first issue is concerned, the relevant facts are that the Assessing Officer noticed that assessee had made payments to a non-resident concern, M/s. Arthur Gensler and Associates without deduction of the requisite tax at source. As per the discussion contained in para 5 of the assessment order, the Assessing Officer has concluded that the payments of Rs. 2,78,20,447/- made to M/s. Arthur Gensler and Associates were in the nature of fee for technical services, and therefore remittance of such amount to the said non-resident concern was liable for deduction at source. As the assessee had not deducted the requisite tax at source, the Assessing Officer invoked the provisions of section 40(a)(i) of the Act and made an addition of Rs. 2,78,20,447/- to the returned income of the assessee. The CIT(A) has also affirmed the said addition against which assessee is in appeal before us. 4. In the above background, the learned representative for the assessee has raised a preliminary objection contending that the provisions of section 40(a)(i) of the Act are not attracted in the pres....
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....I have further examined Schedule 14 of the notes forming part of the financial statements which clearly mentions architect consultancy fees of Rs. 2,88,34,252 as having been paid during the year in foreign currency. Accordingly, this objection of the appellant is not tenable." 6. We have carefully considered the rival submissions. Notably, the controversy before us primarily revolves around invoking of section 40(a)(i) of the Act. Broadly speaking, section 40(a)(i) of the Act prescribes that no deduction shall be allowed in computing income chargeable under the head profits and gains of business or profession of the amounts like, Interest, Royalty, Fees for technical services or other sums chargeable under this Act which are payable outside India or to a non-resident and on which tax is deductible at source under Chapter XVIIB of the Act and such tax has not been deducted or after deduction, has not been paid during the previous year or in the subsequent year before the expiry of the time prescribed under subsection (i) of section 200 of the Act. The aforesaid section has been invoked by the Assessing Officer in the context of payment of Rs. 2,78,20,447/- to M/s. Arthur Gensler an....
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....ins of business or profession" and not otherwise. The case made out by the assessee is that the amount of 2,78,20,447/- paid to M/s. Arthur Gensler and Associates is not debited to the Profit and Loss Account and is therefore not an amount deducted in computing the income chargeable under the heads 'Profits and gains of the business or profession'. Therefore, such an amount does not fall within the purview of section 40 of the Act itself. There is no dispute to the aforesaid factual matrix. The only point raised by the CIT(A), which we have reproduced in the earlier part of the order, is to the effect that assessee has paid the aforesaid sum during the year under consideration in foreign currency. The insistence of the Revenue to say that the amount has been paid in this year and therefore it is covered within the prescription of section 40(a)(i) of the Act is quite otiose to the requirements of section 40(a)(i) of the Act which we have reproduced above. There is no dispute to the proposition that the said payment has not been claimed as a revenue expenditure while computing the income chargeable under the head 'Profits and gains of business or profession' in this year and therefor....
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.... of the Notes below read as under :- "6. "Commercial vehicle" means ............ "light motor vehicle", ............ . The expressions ............. "light motor vehicle", ........ shall have the meanings respectively assigned to them in section 2 of the Motor Vehicles Act, 1988 (59 of 1998)." 11. A conjoint reading of the aforesaid provisions would reveal that the vehicle in respect of which assessee seeks to claim depreciation @ 50% is a 'light motor vehicle' and therefore the claim for enhanced rate of depreciation is on a sound footing. Ostensibly, the aforesaid provisions of the Depreciation Table annexed as Appendix-I to the Rules clearly apply and therefore the lower authorities were not justified in denying assessee's claim for allowance of depreciation @ 50% on the vehicle in question, subject to the fulfillment of other conditions. As a consequence, we set-aside the order of the CIT(A) and direct the Assessing Officer to re-compute the depreciation allowable on the impugned vehicle as per our aforesaid direction and in accordance with law. Thus, on this aspect assessee succeeds for statistical purposes. 12. In the result, the appeal of the assessee is allowed, as above....
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.... be completed within 5 years from the end of the Financial Year in which the housing project is approved by the local authority. In the present case, the Assessing Officer noted that the housing project was approved on 21-11-2005 as per the commencement certificate issued by PMC and therefore the construction was to be completed by 31-03-2011. The Assessing Officer also noted that the date of completion was to be understood as the date on which completion certificate in respect of such housing project is issued by the 'local authority', as required by Explanation (ii) to section 80IB10(a) of the Act. In so far as assessee's project was concerned, the Assessing Officer noted that no completion certificate was issued by PMC before the stipulated date and therefore according to him, assessee did not comply with the requirements of section 80IB(10)(a)(iii) r.w. Explanation (ii) thereof. Therefore, he disallowed such deduction. 15. The CIT(A) however noted that assessee had applied for obtaining the certificate of completion of construction to PMC with all M/s. Gera Development Pvt. Ltd., the requisite NOCs on 04-12-2007 itself. It was also observed by the CIT(A) that assessee was cons....
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....rt of PMC is stated to be the stay on the said property imposed by the State Government due to the ongoing dispute under the Urban Land Ceiling Act. The PMC has provided domestic water supply in the housing project and on the basis of property tax assessment made by PMC, residents of the housing project have paid their property taxes to PMC. The appellant has placed reliance on the Pune ITAT decision in the case of Satish Bora & Associates in ITA Nos. 713 &714/PN/2010 para 19 and 20 of the said decision is as under: "19. For a ready reference our above findings are summarized as under: 1. In the case of PMC, the completion certificate in prescribed form issued by the licensed architect etc, who has supervised the construction is furnished with four sets of completion plan under rule 7.6 of the DC Rules of the PMC. Thereafter PMC is required to return one of the sets duly certified as Completion Plan to the owner along with the issue of full Occupancy Plan to the owner along with the issue of full Occupancy Certificate after inspection of the work under rule 7.7 of the DC Rules. Since Explanation (ii) to section 80-IB(10)(a) of the I. T, Act, requires Completion Certificate issued....
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....ion of the project, and in the present case, it is quite clear that the requisite occupancy certificate has not been issued by PMC and therefore such a project could not be said to have complied with the requirements of completion of construction contained in clause (a) to section 80IB(10) of the Act. 17. On the other hand, the Ld. Representative for the respondentassessee vehemently pointed out that there is no refusal or any objections raised by the PMC with regard to non-completion of construction of the project and therefore the CIT(A) made no mistake in following the decision of the Pune Bench of the Tribunal in the case of Satish Bora and Associates (supra) while allowing the claim of the assessee. 18. We have carefully considered the rival submissions. Quite clearly, the entire case of the Assessing Officer rests on Explanation (ii) to section 80IB(10)(a) of the Act which prescribes that the date of completion of construction of the housing project shall be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority. In the present case, the local authority, i.e. Pune Municipal Corporation has not issued the ....