DCIT vs Kunal Shelters Pvt.Ltd, Pune | ITAT Pune 2022

Income Tax Appellate Tribunal, “A” BENCH,

Before: SHRI S.S.GODARA & DR.DIPAK P.RIPOTE

For Appellant: Shri Suhas P. Bora

For Respondent: Smt. Divya Bajpai – DR

Hearing: 13/09/2022Pronounced: 23/09/2022

Per S.S.Godara, JM:

This Revenue’s appeal for A.Y.2005-06 is directed against the Commissioner of Income Tax (Appeal)-7, Pune’s order dated 19.03.2020 passed in Case No.PN/CIT(A)-7/Cir-14/10192/2015-16, in proceedings u/s.143(3) r.w.s.254 of the Income Tax Act, 1961, in short “the Act”.

Heard both the parties. Case file perused. 2. It emerges at the outset that the Revenue’s instant appeal raising the sole substantive issue of section 80IB(10) deduction hardly requires us to delve deeper in the relevant factual matrix. This is for A.Y. 2005-06 M/s. Kunal Shelters Pvt. Ltd., the reason that we are dealing with second round of proceedings between the parties qua the very issue. And that the learned coordinate bench’s former round of remand directions in assessee’s appeal dated 30-08-2013 had restored the foregoing issue of section 80IB(10) deduction back to the Assessing Officer as follows :

“8.3 The next objection of the Assessing Officer is that the assessee has combined the two flats into one flat in many cases. The assessee submitted that they are combined by the flat purchasers.Without prejudice, in most of the cases, even after combining the two flats, the built up area does not exceed 1500 sq.ft, after excluding balcony, terrace, etc. Hence the deduction is allowable in respect of these flats. According to the learned authorizedrepresentative at the most the deduction may be denied in respect of the flats wherein after excluding balcony, terrace, etc. the built up area of the combined flats exceeds 1500 sq.ft. The question of including garden area in the built up area of a row house does not arise as no construction was done thereon and it is a part of the plot. All these aspects need to be looked into by the Assessing Officer based on facts and circumstances. We therefore, set aside this issue to the file of the Assessing Officer with a direction to decide the same on facts and in law after giving reasonable opportunity of being heard to the assessee. In case certain flats are found to exceed limit of 1500 sq.ft, then disallowance of claim should be restricted to that extent and assessee should be allowed deduction on prorata basis for flats not exceeding prescribed limit u/s 80-IB(10) of the Act. 8.4 The next objection is with regard to the amenities area/additional parking’s. The assessee has got the plan approved later on and regularized the construction done. The assessee has given the circular of the Corporation for regularization of such work. Accordingly, the Corporation granted the sanction post facto. The assessee has relied on ITAT Bangalore Bench decision in the case of ITO Vs. Mahaveer Calyx 126 Taxmann 181 for the proposition that even if such work is not regularized and the assessee has .constructed some excess area, the deduction should not be denied. The assessee submitted that work has been regularized and that such work did not pertain to the individual flats but to the portion like multipurpose hall/tennis court. We find that the Assessing Officer has not looked

DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE (7), PUNE vs. KUNAL SHELTERS PVT.LTD,, PUNE

Cases cited in this judgment