The Delhi Bench of the Income Tax Appellate Tribunal ( ITAT ) recently remitted an Income Tax Appeal filed by Housing and Urban Development Corporation ( HUDCO ) claiming an estimated cost of 10% depreciation on the incurrence of stamp duty and registration charges. The ITAT observed that the matter was not settled and remitted the same for de novo verification.
HUDCO is a public sector undertaking under the Ministry of Housing and Urban Affairs, and is involved in financing housing and infrastructure for urban development projects in India. It was submitted by the Assessee that they had filed their returns of income for the Assessment Year (A.Y.) 2010-11 on 28.09.2010, declaring a total income of Rs.7,89,09,90,414/-.
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The Income Tax Appeal was one of multiple Appeals filed by HUDCO against the Revenue and vice versa; the ITAT rendered the judgment while disposing of the Appeals in unison. The Assessee, through the present Appeal had challenged the confirmation of addition of Rs.18,06,443/- made by the Assessing Officer ( AO ) on estimated increase in the cost of the properties.
The jurisdictional assessing officer observed that the Assessee had made addition of the disputed depreciation by allocating 10% of the estimated cost towards stamp duty and registration charges in respect of properties where lease or sub-lease were yet to be executed.
A chart containing the amount capitalized by the Assessee in this regard was submitted towards the AO, who upon analysis concluded that the Assessee had claimed excess depreciation of Rs.18,06,443/-. The Assessee arrived at such conclusion by calculating depreciation on the basis of similar disallowances made in the preceding years. In Appeal, the Commissioner of Income Taxes (Appeals) upheld the disallowance made by the AO, leading to the present matter before the Tribunal.
Comprehensive Guide of Law and Procedure for Filing of Income Tax Appeals, Click Here
The two-member Bench of the Income Tax Appellate Tribunal, Delhi comprising Yogesh Kumar U.S., Judicial Member and M. Balaganesh, Accountant Member, after considering the submissions made by either parties observed that the subject-matter of the case is not res integra, being adjudicated by the Delhi High Court in the Petitioner’s own matter on 17.05.2015.
The Bench observed that the High Court had remitted the matter back to the file of the Assessing Officer for de novo verification in the Assessee’s Income Tax Appeal pertaining to A.Y. 2003-04. In respect of the precedential nature of the Delhi High Court, the ITAT Bench restored the issue to the file of the Assessing Officer for verification.
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