AI Drafter 
TaxTMI 
TaxTMI 
2024 (10) TMI 237
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....f the Act. I would like to categorically state that I along with my regular counsel complied with all the notices issued from time-to-time during the course of assessment proceedings/ penalty proceedings since those notices were in our knowledge as they were served physically. However, appeal fixation notices and CIT(A) order passed by the Ld. CIT(A), NFAC, Delhi confirming the levy of penalty of Rs. 55,00,000/- were never served physically to me as a result of which I was totally unaware of the fact that appeal fixation notices had been issued and CIT(A) Order had been passed in my case under section 250 of the Act on 20-06-2023. 3. The appeal fixation notices and CIT(A) order passed by the Ld. CIT(A), NFAC. Delhi under section 250 of the Act confirming the levy of penalty of Rs. 55,00,000/- were served only on the E-Mail ID of my regular counsel who inadvertently missed these mail correspondences received. 4. It was just a couple of days' back that my regular counsel came across the fact that order under section 250 of the Act had been passed by the Ld. CIT(A), NFAC. Delhi on 20-06-2023 confirming the levy of penalty of Rs. 55,00,000/- under section 271(1)(c....
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....atutory time limit. The disallowance made by the A.O was confirmed by the CIT(A) as well as this Tribunal vide order dated 05.10.2015. He has further submitted that the disallowance of claim u/s 80IB was up held by this Tribunal by following the judgment of Hon'ble Jurisdictional High Court in case of CIT Vs. M/s Global Reality 80 Taxmann.com 147 M.P. However the operation of the said judgment has been stayed by the Hon'ble Supreme Court in SLP(C) 35314 and 35315 of 2015. Thus the Ld. AR has submitted that in such circumstances the claim of deduction u/s 80IB(10) is a highly debatable issue and the penalty u/s 271(1)(c) of the Act cannot be levied when the claim of the assessee is a bonafide claim. He has relied upon the judgment of Hon'ble Supreme Court in case of CIT Vs. Reliance Petro Products Ltd. 230 CTR 320. He has also relied upon the judgment dated 21.03.2019 of Hon'ble Jurisdictional High Court in ITA No.68 & 69 in case of Surabhi Homes and submitted that the Hon'ble High Court was pleased to held that the penalty was not leviable against the disallowance of claim u/s 80IB(10) due to the technical formality of obtaining completion certificate was not satisfied. He has also....
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....s on behalf of the buyers on their plots. Therefore, it was not a housing project to be eligible for deduction u/s 80IB(10) (ii) most of the houses were having more than 1500 square feet of area and therefore there is a clear breach of conditions for claim of deduction u/s 80IB(10) and (iii) the assessee failed to produce the completion certificate issued by the local authorities within the period prescribed u/s 80IB(10). Thus the Ld. DR has submitted that when the deduction u/s 80IB is not allowable on other two grounds then it is not a case of disallowance of deduction u/s 80IB(10) merely on the ground of non submission of completion certificate. He has referred to para 6.7 of the impugned order of the CIT(A) and submitted that CIT(A) has given the relevant facts in respect of the assessee being only a contractor who constructed houses having built up area of more than 1500 square feet. The order of the A.O in the quantum appeal has been upheld by this Tribunal vide order dated 5.10.2015 and therefore it is a clear case of furnishing inaccurate particulars of income by making the claim of deduction u/s 80IB(10) on incorrect facts. 7. We have considered the rival contentions as....
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....were sold and not as a developer of the housing project; second What the appellant failed to complete the entire housing project before the specified date 31.03.2012; and third the appellant had not constructed all the residential units of the project less than 1500 sq.ft. as only 35 units out of total of 147 residential units were found to be having built up area of less than 1500 sq.ft. It is noticed by the A.O. that the appellant had sold the plots of land to the customers and the sale deeds were registered in their favour and as such the customers became absolute owners of plots. For example, the A.O. noticed that plot of land 52 of the project was sold to Shri G.B. Giri for a consideration of Rs. 6,00,000/- vided registered sale deed dated 03.05.2007. Thereafter, the appellant acted as a contractor for the construction work of the residential units on behalf of the purchaser. The appellant claimed that he had entered into an agreement on 8.11.2006 with Shri G.B. Giri for construction of the residential unit for a total consideration of Rs. 18,00,000/- and, therefore, he has sold the residential units after construction. But as pointed out by the A.O. the said agreemen....
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....he assessee had also not obtained completion certificate from the local authority before the specified date. Considering these facts, the Hon'ble ITAT held that the assessee was not eligible for deduction u/s 80IR(10). The head notes of this decision are reproduced as under :- "Section 801B of the Income tax Act, 1961 Deductions industrial Profits and gains from undertakings other than infrastructure development undertakings Assessment year 2006-07- Whether where assessee sold plots to respective customers by registering a sale deed and thereafter assessee constructed building at an agreed price, it had to be concluded that assessee merely acted as building contractor and not as a developer and therefore assessee's claim for deduction under section 80IB(10) could not be allowed. Held, yes - Whether even other usse, in view of fact that no completion certificate had been issued to assessee by local authority in view of sub- clause (s) of Explanation to section 801B(10). assessee's claim for deduction was to be rejected-Held yes" In view of the above, it is evidently clear that the appellant had acted merely as a contractor after selling the plot and not....
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....j further appeal to the Tribunal and get the mistake, if any, rectified." In this case, the Hon'ble High Court held as under (Head Notes) "Held, that the Commissioner of Income tax (Appeals) not only committed judicial impropriety but also erred in law in refusing to follow the order of the Appellate Tribunal. The members of the Tribunal who decided the appeal upholding the view taken by the Commissioner of Income-tax (Appeals) also did not observe due procedure." 4.6 The Hon'ble ITAT, Bangalore in the case of Jindal Aluminium Ltd. us. ACAIT (2012) 19 ITR ()Trb) (Bang) has also observed as under :- "The Commissioner (Appeals) being an authority lower in the tier of authorities under the Act to Appellate Tribunal, is bound to follow the decision of the Tribunal." Therefore, in view of the above, it is held that the appellant was not eligible for deduction u/s 80IB(10) and accordingly the disallowance of appellant's claim of deduction y.s 80IB(10) of Rs. 1,47,62,057/- (correct figure Rs. 1,48,62,057/-) made by the A.O. is confirmed." The said order of the CIT(A) has been upheld by this Tribunal vide order dated 5.10.2015. It....
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....O and also the appellant's case was not purely an issue of interpretation of law which can be decided either way or a matter of opinion. Rather it is a case where the appellant was well aware that he is not eligible for the claim of deduction as he does not meet more than one condition to be eligible for such claim of deduction but still claimed the same in the return of income and therefore, after considering the factual matrix of the case, the appellant's case has to be considered on separate footing and accordingly held that the appellant furnished inaccurate particulars to make an incorrect claim of deduction u/s.80IB(10). This inference is also supported by the finding in the case of CIT vs. Heil Kalindi Arsspl, 37 Taxmann. Com 347 (Del.), in which case the assessee was in the business of executing works contract and claimed deduction u/s.801A and after examining the facts of the case and the provisions of the Act, Hon'ble Delhi High Court reversed the order of the ITAT and confirmed the penalty as the bona-fides of the assessee were not proved". 8. Apart from the issue of obtaining the completion certificate within the stipulated period the claim of deduction u....