TaxTMI 
TaxTMI 
2015 (4) TMI 791
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.... is illegal, bad in law and without jurisdiction. 2. On the facts and in the circumstances of the case and in law, the worthy CIT erred in holding that the order passed u/s 143(3) of the I.T. Act, 1961 by the AO was erroneous and prejudicial to the interest of Revenue as the AO allowed the provision for development expenses without any verification an discussion. The worthy CIT passed the order u/s 263 of the I.T. Act without appreciating the fact that during the course of assessment proceedings the AO examined this issue in detail and several queries on this issue were made and replied thereof were fled before the AO. 3. On the facts and in the circumstances of the case and in law, the worthy CIT was not justified in invoking the pro....
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....r development expenses" is not an allowable expenses because as per provisions of Income Tax Act the expenses actually incurred are only allowable. The assessee objected to the proceedings u/s 263 vide detailed letter dated 24/03/2014 along with the supporting enclosures, claiming that there was no error committed by AO in allowing this expenditure and there was no prejudice to revenue in this behalf; various other submissions were made and case laws relied, during the course of hearing. Ld. CIT-I, Jaipur rejected assessee's contentions and held Section 143(3) order to be erroneous and prejudicial to the interest of revenue as passed in a casual manner without considering the relevant provisions. Ld. CIT though held that liability of develo....
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....bsp; and Rotork Controls India (P) Ltd Vs CIT (314 ITR 62). However, the liability of the development expenses should be estimated on a scientific basis. Since the AO has not examined and verified the expenses of Rs. 1,46,08,190/- claimed as 'provisions' the assessment order is set aside for the limited purpose of examining and deciding the issue of allowability of expenses of Rs. 1,46,08,190/- claimed as provisions. AO is directed to verify whether the provisions are made only in respect of sales affected during the year receipt of which are offered for tax and whether the development expenses have been estimated in accordance with guidelines issued by the JDA. AO should allow reasonable opportunity or hearing to the assessee." 2.3 Aggr....
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....hat the assessment order was passed in a casual manner without considering the facts of the issue and relevant provisions of the Act is untenable and contrary to the record. It is pleaded that assessee has no control on the manner ld. AO drafts assessment order; generally the issues which are accepted by the Assessing Officer may not find mention in the assessment order. As a general practice only those issues are mentioned in the assessment order on which the assessee's explanation is rejected and additions/disallowances are made. With demonstratively voluminous discussions on assessment record; mere absence of specific mention of issue would not mean that the Assessing Officer had not applied his mind while allowing it. Reliance is placed....
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.... 50/- against road construction. iii) Rs. 42/- water lines and overhead tanks iv) Rs. 37/- electricity work. v) Rs. 21/- drainage system, park etc. Rs. 400/- Total Besides this, following documents are on the assessment record : i. Copy of JDA circulars filed alongwith this letter - PB pg 64 to 85. ii. Working for the provision clearly demonstrating that the estimated liability against expenses is Rs. 400/- per sq. yard and actual expenses incurred during this year were Rs. 137.11 per sq yard and Rs. 262.80/- per sq. yard yet to be incurred. The plot area sold during this year was 55567.44. Therefore the provision of Rs. 1,46,08,190.59/- (55567.44 X 262.89) was made against the plot area sol....
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....td, (ITAT, Jodhpur), ITA No. 357/ JU/2010 dated 13.01.2012. vi CIT Vs Deepak Real Estate Developers Ltd 107 DTR (Raj) 259 vii CIT v. Smt Tasneem Z Madraswala 324 ITR 67 (Mad.), viii CIT vs. DLF Ltd. [2013] 350 ITR 555 (Delhi) ix CIT v. Arvind Jeweller, 259 ITR 502 (Guj.), x CIT Vs Smt. D Valliammal (1998) 230 ITR 695 (Mad). xi CIT Vs Hastings Properties (2002) 253 ITR 124 (Cal). xii CIT Vs Max India Ltd (2007) 295 ITR 282 (SC) (xiii) Malabar Industrial Co Ltd Vs CIT (2000) 243 ITR 83 (SC) 2.5 Ld. CIT (DR) contends that assessee had made a huge claim of development expenses qua development expenses. The AO failed to mention even a single word about the justification for allowability of the claim. It clearly indicat....