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TMI Blog2023 (9) TMI 1020X X X X Extracts X X X X X X X X Extracts X X X X ..... 2022 arising out of the orders passed Andhra Pradesh Capital Region Development Authority, Vijayawada u/s 143(3) of the Income Tax Act, 1961 (in short "Act") for the Assessment Years (A. Ys.) 2014-15, 2016-17 to 2018-19. Since the grounds raised in these appeals are identical, these appeals are clubbed, heard together and a common order is being passed for the sake of convenience as under. Facts are extracted from I.T.A.No.26/Viz/2023. 2. Brief facts of the case are that the assessee, Vijayawada, Guntur, Tenali, Mangalagiri Urban Development Authority known as Andhra Pradesh Capital Region Development Authority, a statutory authority constituted under section 3 of Andhra Pradesh Urban Areas (Development) Act, 1975 is a non profit oriented ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the AO, the assessee preferred an appeal before the CIT(A) and the Ld.CIT(A) after careful consideration of the facts of the case, reply uploaded by the assessee in response to the notices issued u/s 250 of the Act and the order of the Hon'ble ITAT relied by the assessee on similar ground for the A.Y. 2009-10 to 2013-014 in ITA No. 395 to 399/Viz/2017 dated 30.09.2022, allowed the appeal of the assessee. 4. Aggrieved by the order of the Ld.CIT(A), the revenue preferred appeals before the Tribunal by raising the following grounds : 1) The order of the Ld.CIT(A) is erroneous both on facts and in law. 2) The Ld.CIT(A) erred in deleting the disallowance of Rs. 28,85,80,701/- made by the Assessing Officer treating the amount as m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... available on record. It is undisputed fact that the assessee is a non-profit organisation, established for the development of urban areas by implementing the provisions of the Master Plan as per the directions of the Government of Andhra Pradesh. The assessee debited 85% of the Development Charges received to the sinking fund to meet the future formation charges as per the directions given in GO Ms. No. 530 dated 28.09.1998. Coordinate Bench of the Tribunal in the assessee's own case for the A.Y. 2009-10 to 2013-14 on similar issue in I.T.A. No. 395, 396, 397, 398 & 399/Viz/2017 dated 30.09.2022 allowed the appeal of the assessee holding that since the assessee could not expend 85% of the development charges during the relevant assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch was more than the Sinking Fund created during the year. It is normal accounting practice under the Accrual System of Accounting any future expenditure needs to be provided in the books of accounts in the relevant assessment year. It is not necessary that deduction shall be permissible only in case of amounts actually expended or paid. Further, it is also noticed that the assessee is supposed to expend 85% of the amount to developmental activities as approved by the Government of Andhra Pradesh in accordance with the Master Plan revised. It can be concluded that the assessee as formed under the Andhra Pradesh Urban Areas (Development) Act is bound by the directions of the Government in the collection and execution of development charges. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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