Case Number: ITA 5487/Del/2019
Appellant: ITO, Ward- 25(3), New Delhi
Respondent: Time Bound Contracts Pvt. Ltd., New Delhi
Assessment Year: 2013-14
Result: Final Tribunal Order
Case Filed on: 2019-06-21
Date of Order: 2023-10-25
Pronounced on: 2023-10-25
This appeal by the Revenue challenges the order of the CIT(A)-23, New Delhi, regarding the assessment year 2013-14. The dispute centers on the addition of Rs.58,78,13,030 initially made by the AO on the basis of deemed profit from the transfer of land to Parsvnath Developers Ltd., which was significantly reduced by the CIT(A).
The appellant, Time Bound Contracts Pvt. Ltd., is engaged in the business of land purchase and real estate development. For the assessment year in question, the company declared a loss, raising suspicions from the Assessing Officer regarding the non-disclosure of revenue from land transfers detailed in the company’s financial statements. The main contention was the recognition of revenue from the transfer of work in progress (WIP) land to the developer company, which the AO argued should reflect in the company’s financials, rejecting the private arrangement between Time Bound Contracts and Parsvnath Developers Ltd.
The ITAT, led by Shri Saktijit Dey, Vice-President, and Dr. B.R.R. Kumar, Accountant Member, heard the case. The tribunal noted that similar issues had been previously adjudicated in favor of the assessee in related assessment years, where it was established that Parsvnath Developers Ltd. was the real beneficiary of the sales transactions, not the appellant. This precedent led to the deletion of the major part of the addition, leaving only a nominal amount of Rs.78,510 as sustained by the CIT(A).
The tribunal upheld the decision of the CIT(A), dismissing the Revenue’s appeal and solidifying the stance that Time Bound Contracts Pvt. Ltd. acted within the legal bounds of its arrangement with Parsvnath Developers Ltd.
ITO, Ward- 25(3) vs. Time Bound Contracts Pvt. Ltd.: Land Ownership Dispute for AY 2013-14
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