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Showing contexts for: Building deviation in Keerthi Estates Pvt.Ltd., Hyd, ... vs Dcit, Circle-2(1), Hyderabad, ... on 9 August, 2017Matching Fragments
3. In response to the show cause notice issued, the ld. AR of the Assessee attended on 17.03.2015 & 20.11.2015 and filed written submissions seeking to drop the proposed action. In the written submissions, the A.R. has given the following reasons against the proposed action:
"(a) The said payment was made for regularization of a deviation in the building plan which was within the permissible limits and it was not in respect of an offence. Hence, explanation (1) to sec. 37(1) has no application to the facts of its case.
In support of his contentions, the Ld. A.R. has cited the decision of Hon'ble Delhi High Court in the case of CIT Vs. Loknath & Co., reported in 147 ITR 624, wherein it was held that the fee paid against the deviations in the approved building plan is an allowable deduction u/s.37 of the I.T. Act. It was further stated by him that the decision taken by the AO was Keerthi Estates (P) Ltd.
based on the decision of the Delhi High Court which was in favour of the assessee and which should be followed as laid down by the Supreme Court in the case of CIT Vs. Vegetable Products Ltd., reported in 88 ITR 192."