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Income Tax Appellate Tribunal, PUNE BENCH “C”, PUNE
Before: SHRI R.S. SYAL & SHRI PARTHA SARATHI CHAUDHURY
PER R.S.SYAL, VP :
This appeal by the Revenue is directed against the order passed by the Commissioner of Income-tax (Appeals)-5, Pune on 09-12-2016 in relation to the assessment year 2012-13.
The only issue raised in this appeal is against the direction of the ld. CIT(A) to allow deduction u/s.80IB(10) of the Income-tax Act, 1961 (hereinafter also called `the Act’) on pro-rata basis.
2 ITA No.1050/PUN/2017 M/s. Nirmitee & Associates
Succinctly, the facts of the case are that the assessee firm is
engaged in the activity of Promoters and Builders. During the year
under consideration, it carried out construction of a housing project,
namely “Nirmiti Zion”, S.No.36/3 and 36/4, Balewadi, Pune. The
assessee claimed deduction u/s. 80IB(10) amounting to
Rs.4,36,38,861/-. To verify the eligibility of claim of deduction, the
Government approved valuer was commissioned by the AO to
conduct an enquiry of the aforesaid project vis-a-vis the provisions of
section 80IB(10). The Valuer submitted his report stating that two
duplex flats bearing Nos. 901 and 902 were having areas of 2609.48
sq.ft. as against the provisions of section 80IB(10) providing for area
of a residential unit located in cities other than Mumbai and Delhi at
less than 1500 sq.ft. The assessee was confronted with the report. In
its objections, and in the alternate, the assessee submitted that the
deduction should be allowed on proportionate basis. Not convinced,
the AO denied the benefit of full amount of deduction u/s.80IB(10) at
Rs.4.36 crore. The ld. CIT(A) held that proportionate deduction
should be allowed in respect of the eligible flats after excluding the
profits of non-eligible flats. The Revenue has approached the
Tribunal against this finding.
We have heard both the sides and gone through the relevant
material on record. There is no dispute on the fact that the assessee is
3 ITA No.1050/PUN/2017 M/s. Nirmitee & Associates
otherwise eligible for deduction u/s.80IB(10) of the Act fulfilling all
the stipulated requirements. The AO denied the benefit of deduction
for the entire amount of deduction u/s.80IB(10) only on the ground
that out of the total project, only two flats admeasured more than the
stipulated 1500 sq.ft. area. But for that, there is no objection of the AO
to any of the conditions stipulated in section 80IB(10). In this regard,
it is observed that the ld. CIT(A) in holding for the proportionate
deduction has relied on several decisions including the order of the
Mumbai Tribunal in M/s. Suncity Housing Vs. ACIT in ITA
No.5183/Mum/2014 dated 30-05-2016 and another decision of Pune
Bench in the case of DCIT Vs. Sai Drishti Construction in ITA
No.991/PUN/2014, dated 15-02-2016. No contrary decision has been
brought on record by the ld. DR. Since the impugned order is based
on several Tribunal orders granting deduction u/s.80IB(10) on
proportionate basis, respectfully following the precedents, we approve
the action of the ld. CIT(A).
In the result, the appeal is dismissed. Order pronounced in the Open Court on 04th September, 2019.
Sd/- Sd/- (PARTHA SARATHI CHAUDHURY) (R.S.SYAL) JUDICIAL MEMBER VICE PRESIDENT पुणे Pune; �दनांक Dated : 04th September, 2019 सतीश
4 ITA No.1050/PUN/2017 M/s. Nirmitee & Associates
आदेश क� क� क� �ितिलिप क� �ितिलिप �ितिलिप अ�ेिषत �ितिलिप अ�ेिषत अ�ेिषत/Copy of the Order is forwarded to: अ�ेिषत आदेश आदेश आदेश अपीलाथ� / The Appellant; 1. ��यथ� / The Respondent; 2. 3. The CIT(A)-5, Pune 4. The Pr.CIT-4, Pune िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, पुणे 5. “सी” / DR ‘C’, ITAT, Pune; 6. गाड� फाईल / Guard file. आदेशानुसार आदेशानुसार/ BY ORDER, आदेशानुसार आदेशानुसार // True Copy // Senior Private Secretary आयकर अपीलीय अिधकरण ,पुणे / ITAT, Pune
Date 1. Draft dictated on 03-09-2019 Sr.PS 2. Draft placed before author 03-09-2019 Sr.PS 3. Draft proposed & placed JM before the second member 4. Draft discussed/approved JM by Second Member. 5. Approved Draft comes to Sr.PS the Sr.PS/PS 6. Kept for pronouncement on Sr.PS 7. Date of uploading order Sr.PS 8. File sent to the Bench Clerk Sr.PS 9. Date on which file goes to the Head Clerk 10. Date on which file goes to the A.R. 11. Date of dispatch of Order. *