Pahari Mata Sahkari Awas Samiti Ltd. Vs ACIT (ITAT Lucknow)
The Commissioner (Appeals) is duty bound to dispose of the appeal through a speaking order on merits on all the points which arose for determination in the appellate proceedings, including on all grounds of appeal; and that the Commissioner (Appeals) is not empowered to dismiss the appeal for non-prosecution and is obliged to dispose of appeal on merits.
FULL TEXT OF THE ORDER OF ITAT LUCKNOW
This appeal has been filed by the assessee against the order of the ld. CIT(A), National Faceless Appeal Centre (NFAC), Delhi dated 19.12.2023 for the assessment year 2015-16, inter alia, on the following grounds:-
1. The Ld. C.I.T. (A) erred on facts and in law in dismissing the appeal on Ex-parte basis without appreciating Adjournment Application on Medical Ground of the Counsel being “Total Knee Replacement Surgery” with supporting medical documents submitted on 18.12.2023 which is also mentioned in the Order of the Ld. C.I.T. (A).
2. The Ld. C.I.T. (A) erred on facts and in law in not deciding the appeal on Merits by passing speaking order without appreciating that Ld. CIT(A) is not empowered to dismiss the appeal for non – prosecution.
3. The Ld. C.I.T. (A) failed to appreciate that Ld. A. O. wrongly added Rs.26,32,067.00 being difference between Sale consideration and Stamp Value without appreciating that Flats sold during the year had been allotted at Agreed Rate to Flat Buyers in earlier year much before 01.04.2014 being date of amendment u/s 43CA and booking advance has also been received in earlier year through cheque, hence the Stamp Duty Value in respect of these sales should be date of Allotment / Agreement and receiving of Booking Advance through cheque in earlier year as specified in Clause- 3 and 4 of Section -43CA of I.T. Act.
4. The Ld. C.I.T. (A) upheld incorrect finding of Law by Ld. A. O. where he had wrongly held that Clause-3 & 4 of Section 43CA are applicable for 01.04.2014 and not considering that Clause 3 and 4 provides the effective date of Circle Rate where allotment / Agreement has been made in earlier year and payment has been made through cheque and same are squarely applicable assessee’s case as relevant details has been furnished during Assessment Proceeding.
5. The Ld. C.I.T. (A) erred on facts and in law in upholding the finding of Ld. A. O. that Allotment Letter could not be treated as Agreement inspite of the fact as per Contract Act and as per settled case laws and CBDT Circular, the Allotment Letter is also binding contract between the Developer and Flat Buyer. Further the Ld. A. O. rejected the Allotment Letter on Technical Ground without appreciating that all the flats allotted had been sold in subsequent year i.e. A. Y.-2015-16 and details of payment made by the Flat buyers has also been stated in the Registered Sale Deed submitted during course of assessment proceeding.
6. The Ld. CIT(A) upheld the incorrect addition of Rs.26,32,067/- made by ld. A. O. who had made the addition on the basis of Chart reproduced in Assessment Order without considering each Registered Sale Deed, Date of allotment and Payments made through cheque before 01.04.2014 by the Flat Buyers towards the booking of Flat and Date of applicability of Circle Rate in the year of allotment.
7. The Ld. C.I.T.(A) erred on facts and in law in upholding the addition of Rs.3,82,500.00, by disallowing excess Interest of 6% out of 18% paid on Unsecured Loans which were used solely and exclusively for the purpose of business as per business needs.
8. The Ld. CIT (A) erred on facts and in law in upholding the incorrect finding of Ld. A. O. that Unsecured Loan has been received from the related parties and not shown in Audit Report inspite of the fact there is no Lender is related party in the present case. Further the Rate of Interest 18% paid on Unsecured Loan is reasonable as per present market condition.
9. The Ld. C.I.T.(A) erred on facts and in law in upholding the incorrect finding of Ld. A. O. regarding assessee having sufficient working Capital as Ld. A. O. is not a Competent Authority to access the needs and business expediency of Business which assessee has to decide for the purpose of its business.
10. The Additions upheld by Ld. C.I.T. (A) are highly excessive, contrary to the facts, law and principle of natural justice and without providing sufficient time and opportunity to have its say on the reasons relied upon by Ld. A.O.
2. The brief facts of the case are that the assesse, a cooperative society, engaged in the construction and sale of residential houses/flats, e-filed its return of income on 28.09.2015 declaring a total income of Rs.24,55,240/-. The case was selected for scrutiny through CASS under ‘Limited Scrutiny Criteria’. The Assessing Officer finally completed the assessment, assessing the total income of the assessee at Rs.54,69,807/-, making additions of Rs.26,32,067/- under section 43CA of the Act and Rs.3,82,500/- on account of higher interest paid to relatives.
