DCIT , CIRCLE- 3, THANE vs. SADHANA BUILDERS PVT. LTD., THANE

1. On the facts and in the circumstances of the case, and in law, the Ld.CIT(A) has erred in holding that the project was completed on or before 31.03.2009 when occupation certificate was accorded only in respect of 9206.30 sq.Mtr. against sanction of 11960.15 Sq.Mtr.

Upon perusal of impugned order, it could be observed that learned first appellate authority has merely followed the order of Tribunal in assessee’s own case for AY 2009-10, order dated 01/01/2016 while granting relief to the assessee. The relevant extract of the order has already been reproduced in the impugned order. In fact, the cited order of Tribunal has subsequently been followed by coordinate bench while adjudicating revenue’s appeal for AY 2010-11, ITA No.2099/Mum/2015 order dated 15/12/2016, a copy of which has been placed on record. The aforesaid position has remained undisturbed before us. No change in facts has been demonstrated before us. There is nothing on record to indicate that the aforesaid decisions have been reversed or not applicable, in any manner. In the above background, our adjudication to the appeal would be as given in succeeding paragraphs. The assessee is stated to be engaged as builders and developers. 3.1 The assessee was assessed for the year under consideration u/s 143(3) r.w.s. 147 on 29/03/2014 wherein the deduction claimed u/s 80IB(10) amounting to Rs.701.40 Lacs was disallowed and added to the income of the assessee. It transpired that the assessee had undertaken to construct a project in the name of M/s. Sadhana Builders Pvt.Ltd. Assessment Year: 2008-09 ‘Dhaval Hills’ admeasuring 11960.15 sq.mts. which was approved by the local authority (TMC) on 09/07/2004. For construction of the project, the assessee had entered into a development agreement with another entity namely M/s. Gaytri Associates on 29/12/2005 wherein as per clause no. ‘H’ of the said agreement, the assessee had given contract for construction of buildings ‘A’ and “B” of ‘Dhaval Hills’ with material to M/s Gaytri Associates as approved by TMC. The profit of Rs.701.40 Lacs arising on sale of flats in the aforesaid buildings was claimed exempt u/s 80IB(10) of the Act for AY 2008-08 and in subsequent years also for the same project. 3.2 However, Ld. AO observed that during assessment proceedings for AY 2009-10, it was noted that the project was approved during F.Y.2005-06 and therefore, the assessee was required to complete the construction of built up area of 11960.15 sq.mts. by 31/03/2009. However, the assessee failed to do as it had completed construction of built-up area of 11592.43 sq.mts. only meaning thereby that the area of 367.72 sq.mts. remained unconstructed. Accordingly, deduction claimed u/s 80IB(10) for AY 2009-10 was disallowed. 3.3 Since similar were the facts in AY 2008-09, the case was reopened as per due process of law. As per completion /occupancy certificate dated 09/12/2008 issued by TMC, the assessee had completed construction of built up area of 11592.43 sq. as against approved construction of built up area of 11960.15 sq.mts. Therefore, as per Ld. AO the project was not fully completed and the assessee violated conditions for claiming deduction u/s 80IB(10). Though the assessee defended its stand of claiming M/s. Sadhana Builders Pvt.Ltd. Assessment Year: 2008-09 deduction, Ld. AO rejected the same and disallow the deduction as claimed u/s 80IB(10).

The Ld. CIT(A), at para 4.3 of the order, relying upon the cited order of Tribunal in assessee’s own case for AY 2009-10, principally allowed the claim of the assessee after directing Ld. AO to exclude interest income and other income from Ratnagiri Project which was not eligible for deduction. Aggrieved, the revenue is in further appeal before us.

It is evident that the facts of the case are squarely covered by the decision of this Tribunal in assessee’s own case for AY 2009- 10 which has been followed by coordinate bench subsequently in AY 2010-11 also as detailed in preceding para-2. Therefore, we see no reason to deviate from the same, facts and circumstances being remaining the same.

The appeal stand dismissed in terms of our above order. Order pronounced on 01st February, 2021 Sd/- Sd/- (Mahavir Singh) (Manoj Kumar Aggarwal) उपा�� / Vice President लेखा सद� / Accountant Member मुंबई Mumbai; िदनांक Dated : 01/02/2021 Sr.PS, Kasarla Thirumalesh आदेशकी�ितिलिपअ�ेिषत/Copy of the Order forwarded to : अपीलाथ�/ The Appellant 1. ��थ�/ The Respondent 2. आयकरआयु�(अपील) / The CIT(A) 3. आयकरआयु�/ CIT– concerned 4. िवभागीय�ितिनिध, आयकरअपीलीयअिधकरण, मुंबई/ DR, ITAT, Mumbai 5. गाड�फाईल / Guard File 6.