INCOME TAX OFFICER,, PUNE vs. M/S. NIRMITEE & ASSOCIATES,, PUNE

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.

2 ITA No.1050/PUN/2017 M/s. Nirmitee & Associates

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.

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).

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. *