ITAT Rejects Revenue's Appeal Seeking To Make ₹63.21 Billion Addition To DLF's Income For AY 2017-18
The Income Tax Appellate Tribunal at New Delhi has dismissed an appeal preferred by the Revenue against an order of the National Faceless Centre (CIT(A)), deleting aggregate ₹63,02,13,86,035 addition made to income of real estate giant DLF Limited on various counts, for the Assessment Year 2017-18.In its 82-page judgement, the Tribunal also disposed of the company's appeal against...
The Income Tax Appellate Tribunal at New Delhi has dismissed an appeal preferred by the Revenue against an order of the National Faceless Centre (CIT(A)), deleting aggregate ₹63,02,13,86,035 addition made to income of real estate giant DLF Limited on various counts, for the Assessment Year 2017-18.
In its 82-page judgement, the Tribunal also disposed of the company's appeal against confirmation of addition made by CIT(A) on account of unverified purchase transactions, by remitting the issue to the Assessing Officer to consider the same afresh.
The order was passed by a bench of Madhumita Roy (Judicial Member) and Brajesh Kumar Singh (Accountant Member).
DLF had filed its return of income for AY 2017-18 declaring loss of Rs.20,04,58,93,245/-.
The said assessment was selected for scrutiny and it was finalized upon making additions on the following counts:
1. Rs.319,01,05,617/- addition on account of recognition of revenue as per Percentage of Completion Method (POCM);
2. Addition to the tune of Rs.61,34,84,000/- on account of disallowance on account of capitalization of interest;
3. Disallowance of expenses to the tune of Rs.54,63,24,512/- under Section 14A read with Rule 8D(2)(ii) & (iii) of the Income Tax Act 1961;
4. Addition to the tune of Rs.24,85,57,703/- on account of re-classification of income form “Income declared under the head income from house property” to “Income from business and profession”;
5. Deletion of disallowance to the tune of Rs.9,03,15,833/- on account of Helicopter and Aircraft expenses, treating them as not incurred wholly & exclusively for the business purpose holding them personal in nature;
6. Deletion of addition to the tune of Rs.58,26,95,93,000/- on account of one time Ind-AS claim under the head “Large any other amount claimed as deduction” on account of adoption of Ind-AS;
7. Addition to the tune of Rs.6,30,05,370/- on account of disallowance under Section 40(a)(ia) of the Act.
In doing so, the High Court took note of various decisions for preceding AYs, whereby coordinate benches had ruled in favour of DLF on identical facts and circumstances.
So far as Ground number 6 is concerned, the ITAT found the adoption of Ind-AS method to be bona fide, consistent with Section 145 of Income Tax Act and revenue neutral.
As such, the Revenue's appeal came to be dismissed.
Appearance: Appellant by : Shri R. S. Singhvi, Shri Satyajeet Goel and Shri Rajat Garg, C.A.'s Respondent by : Shri Surender Pal, CITD.R. Shri Sanjay Kumar Yadav, Sr. D.R.
Case title: DCIT v. DLF Limited
Case no.: I.T.A. Nos. 711/Del/2024