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Before: Honble Supreme Court.
Order under section 254(1) of Income –tax Act PER PAWAN SINGH, JUDICIAL MEMBER; 1. The above referred two appeals by Revenue are directed against the order of ld. Commissioner of Income-Tax (Appeals)-II [ld. CIT(A)], Pune & ld. CIT(A)-II, Thane dated 25.06.2012 & 20.08.2014 for Assessment Year 2009-10 & 2010-11 respectively. In both the appeals, the Revenue has raised the common grounds of appeal, which relates to deduction under section ITA 6491/M2012 & Nancy Icon Builders and Developers 80IB (10). Therefore, both the appeals were clubbed, heard and are decided by a consolidated order for the sake of brevity. With the consent of parties, the appeal for Assessment Year 2009-10 was treated as lead case. In appeal for Assessment Year 2009-10, the Revenue has raised the following grounds of appeal:
(1) On the facts and circumstance of the case and in law, the Learned CIT(A)-II, Pune erred in allowing deduction u/s. 80IB to the assessee thereby deleting addition ofRs.42,38,34,378/- made by the assessing officer. (2) On facts and circumstances of the case and in law, the Learned CIT(A)-II, Pune failed to appreciate the fact that the project of the assessee is incomplete as out of 16 buildings sanction for construction, only 11 were constructed and moreover, internal part of some flats, club house and parking being part of the project were also not complete on the date of issue of completion certificate. (3) On facts and circumstances of the case and in law, the Learned CIT(A)-II, Pune erred in interpreting the words 'project' relying upon decision of Saroj Sales Corporation Vs ITO (Mum) 115 TTJ 485 & Vandana Properties 128 TTJ 89 (Mum) decision of which have not been accepted by the department and departmental appeal is pending before Hon'ble Supreme Court. (4) On facts and circumstances of the case and in law, the Learned CIT(A)-II, Pun erred in holding that the land cost of the project is Rs.25,00,000/- as against adoption of Rs.17.89 crores by the Assessing Officer. (5) The appellant prays that the order of the Learned CIT(A)-II, Pune, be canceled and that of the A.O. be restored.
Brief facts of the case are that the assessee is an Association of Person (AOP) consisting of M/s Nitika Builders & Developers and Mr.Ali Jaffari.
The assessee is undertaking of development of housing project at Katraj, 2 ITA 6491/M2012 & Nancy Icon Builders and Developers Pune. The assessee filed its return of income for Assessment Year 2009-10 on 24.09.2009 declaring Nil income after claiming deduction under section 80IB(10) for Rs. 42,38,34,378/-. The assessment was completed on 30.12.2011 under section 143(3). The Assessing Officer while framing the assessment order disallowed the deduction under section 80IB(10) for Rs. 42,38,34,378/-. The Assessing Officer also restricted the profit from housing project at Rs. 24,58,51,149/- against the profit of Rs. 42,38,34,378/- claimed by assessee holding that project cost comprised of cost of land and construction. The assessee has not considered the payment of Rs.17,79,83,229/- paid to Ali Jafri during the relevant year, paid against the cost of land. Therefore, the assessing officer took his view that the amount of Rs. Rs.17,79,83,229/- is taxable in the hand of Ali Jafri. On appeal before the learned Commissioner (Appeals)s, the assessee was allowed deduction under section 80IB(10) and hold that the land cost of the project is Rs. 25,00,000/- against the cost of Rs. 17.89 Crore determined the Assessing Officer. Therefore, aggrieved by the order of learned Commissioner (Appeals), the Revenue has filed the present appeal before us.
We have heard the ld. Departmental Representative (DR) for the Revenue and ld. Authorized Representative (AR) of the assessee at length and ITA 6491/M2012 & ITA No. 7059/M/2014 Nancy Icon Builders and Developers perused the material available on record. Ground No. 1 to 3 raised by Revenue relates to deduction under section 80IB (10). The learned DR for the revenue submits that as per the commencement certificate issued by Pune Municipal Corporation (PMC) vide No. 3431/05 dated 31 December 2005. The project was approved for 559 tenements on 31st December 2005.
The building layout plan was revised 9 times. As per last revised plan dated 12 September 2007, the project was approved for 559 tenements. However, only 383 residential units in 9 buildings were completed. The mute question for consideration in the present case is whether the assessee complied with the conditions prescribed for claiming deduction under section 80 IB(10), in respect of housing project, approval of which was obtained more than once, such housing projects shall be deemed to have been approved on the date on which the building plan of such building was first approved by the local authority. In the present case the project was first approved on 31st December 2005. Therefore, the plan sanctioned on 31st Dec 2005, has to be taken into consideration while giving to the benefit under section 80 IB. The assessee never furnished the sanctioned plan to the assessing officer, to first appellate authority or before Tribunal. During the assessment the assessing officer recorded the statement of Sunil H Mohite, Junior Engineer (JE) in ITA 6491/M2012 & Nancy Icon Builders and Developers Pune Municipal Corporation on 7th December 2011. The said JE given a categorical statement that no final completion certificate has been issued for the entire project. From the statement of JE, it is clear that only partial completion of the project is granted, which was ready for occupation and not for the entire project. Since, the project was not complete during the relevant period; the assessee is not entitled to claim deduction at under section 80IB, as the assessee has not fulfilled all necessary conditions for claiming such deduction. Therefore, ld. DR prayed that the order of learned Commissioner (Appeals) is liable to set- aside by restoring the order passed by assessing officer. In support of his submission the learned DR of the assessee relied upon the decision of Pune Tribunal in the Rahul Construction Co. Versus ITO (ITA No.1250/PN/2009 and ITA No.707/PN/2010) dated 30.03.2010, DCIT Vs Anand Ashok Gandhi (ITA No. 2004/PN/2014 dated 27.05.2016, Saroj Sales Organisation Vs ITO (2008) 115 TTJ 485(Mum) and Madhya Pradesh High Court in CIT versus Global Reality 379 ITR 107( MP) (2015).
On the other hand the learned AR for the assessee supported the order of the learned Commissioner (Appeals). The ld. AR for the assessee further submits that on the basis of same facts the assessing officer allowed deduction under section 80IB in assessment year 2008-09. The claim of ITA 6491/M2012 & Nancy Icon Builders and Developers deduction was allowed in assessment year 2008-09 by assessing officer after his satisfaction. The copy of the assessment order for assessment year 2008- 09 passed under section 143(3) dated 21.10.2010 is placed on record. The ld. AR for the assessee submits that the contention of ld. DR for the revenue that copy of sanction order was not furnished to assessing officer and before learned Commissioner (Appeals) is not correct. All necessary documentary evidences were provided to the lower authorities.
The ld AR further submits that initially plan was approved by Pune Municipal Corporation (‘PMC’) on 31.12.2005 for 195 residential unit. The final sanction plan was taken for 383 residential units in 9 buildings (A to H & J), having total area of 35026.7 sq Mtr vide Commencement Certificate No. 4600/06 dt.28.03.2007. The assessee completed construction at units in three phases. The final occupancy certificate was issued by PMC on 30.03.2010 vide its letter No. 646 in respect of all nine buildings. The assessee fulfilled all requisite conditions for claiming deductions under section 80IB (10). The first completion certificate in respect of 20 flats was issued on 14.03.2007 the copy of which along with true translated copy is filed (page 2-3of PB). The second completion certificate in respect of 174 flats was issued on 07.05.2008 the copy of which along with true translated ITA 6491/M2012 & ITA No. 7059/M/2014 Nancy Icon Builders and Developers copy is filed (page 5-7 of PB). Third completion certificate in respect of 189 flats was issued on 25.01.2010 the copy of which along with true translated copy is filed (page 9-11of PB). The objection of the assessing officer is that no final completion certificate if issued by PMC. The ld. AR for the assessee further submitted that on the basis of same facts the assessing officer allowed deduction under section 80IB in assessment year 2008-09. The assessing officer while granting deduction for assessment year 2008-09 accepted that revise sanction plan was granted to the assessee. The built up area of the project was also accepted as 35035.53 Sq Mtr. The ld AR for the assessee also drawn our attention to the letter issued by PMC on 23.11.2011 to Assessing officer ( page 15 of PB), wherein the Assistant Engineer (AE) clearly stated that the occupancy certificate is issued after completion certificate is issued by Architect as per Appendix-J Rule 7.5 of DC Rule of PMC. It is also shown to us that the AE of PMC clearly stated in its letter the uncompleted work are of finishing items and are out of the scope to be considered while issuing the occupancy certificate. It is also mention is the letter of AE that the FSI of the project is 35026,70 Sq Mts which has been consumed in 383 units (tenements) in building A, B,C, D,E, F, G, H &J.
ITA 6491/M2012 & Nancy Icon Builders and Developers 6. The ld. AR for the assessee submits that the as per various decisions of High Courts and Tribunals the assessee is entitled for proportionate deduction under section 80IB(10) claimed during the year. In support of his submissions that the assessee is eligible for proportionate deduction under section 80IB(10), the ld AR for the assessee relied on the following decision;
(a) Viswas Promotors (P) Ltd Vs ACIT (255 CTR 149)(Mad), (b) Rohan Homes Vs ACIT( 31.03.2013, (c) DCIT Vs Ekta Homes Pvt Ltd (ITA 3649/M/2009) dated 20.05.2011, (d) ACIT Vs Suncity Housing (ITA No. 5183/M/2014) dated 30.05.2016, (e) Bengal Ambuja Housing Development Ltd Vs ACIT (ACIT Vs 1595/Kol/2005) upheld by Hon'ble Calcutta High Court in IT Appeal No.458 of 2006 dated 05/01/2007, (f) Arun Excello Foundation Pvt Ltd Vs ACIT [ 108 TTJ 71 (Chen)], (g) G.V. Corporation Vs ITO [ 38 SOT 174( Mum)], (h) SJR Builder Vs ACIT [3 ITR (T) 569 (Bang)], (i) ITO Vs Air Developers [122 ITD 125(Nag)] (j) CIT Vs Global Reality [2005] 379 ITR 107 (MP).
We have considered the rival submissions of the parties and have gone through the orders of the authorities below. During the assessment the assessing officer made reference to the department valuation officer (DVO) to ascertain the verification of the claim of the assessee for deduction under section 80IB. The DVO furnished its report dated 21.11.2011. In the report it was pointed out that 38 flat in building (block) - H, 40 flats in block G and some flat in block J are incomplete. Further internal finishing; including ITA 6491/M2012 & Nancy Icon Builders and Developers water and sanitary, door and painting etc., have not been done. Covered parking of blocks K, L, M &N have not started. The DVO also raised doubts as to how the completion certificate was issued by Pune Municipal Corporation (PMC), when a number of flats are incomplete. Finding adverse report the assessing officer summoned Junior Engineer ('JE') of Pune Municipal Corporation ('PMC') under section 131of Income –tax Act.
In response to the summon under section 131, Sh. Sunil H Mohite JE of PMC attended the office of assessing officer. The assessing officer recorded the statement of Sunil H Mohite on oath. After recording the statement of JE of PMC, he was again directed to inspect the building and furnish the report.
The said JE furnished the report on 23.12.2011 ( page No.15 of PB). In the report dated 23.12.2011 it was contended that inspection of the site/property was carried out on the report submitted by DVO that some item like internal electrification, internal water supply, sanitary fittings and internal painting are still not done. Covered parking building KLM and N have still not been started for construction, which was also noticed by JE on 19 December 2011. It was further contended that the total sanction floor surface index ('FSI') in this project is 35026.70 sq Mt which was consumed in building A, B, C, D, E, F, G, H and J in 383 tenements . This FSI is consumed and ITA 6491/M2012 & Nancy Icon Builders and Developers construction on the site is as per sanction plan. Hence, the sanctioned certificate was issued to the extent. The developer has not constructed covered parking slab in K, L, M & N which was not taken in F.S.I. but was an additional facility proposed in the project which the developer has not avail.
On the basis of report of DVO and JE of PMC the assessing officer issued show cause notice to the assessee as to why the projects should not be treated as incomplete and deduction under section 80IB should not be disallowed. In response to the show cause notice the assessee vide its reply dated 29th December 2011 contended that project was approved on 31st December 2005 and completed vide completion certificate No. 646 dated 30th March 2010 and, thus, the assessee is eligible for deduction under section 80IB. The contention of assessee was not accepted by assessing officer on his view of the shortcoming pointed out by DVO and as per statement of JE recorded on 7 December 2011. The assessing officer further held that housing project cannot be treated only of the building, it also includes the various immunities like covered parking, Clubhouse, garden etc, which have been sanctioned in the plan by the Municipal authorities.
The first plan was sanctioned on 31st December 2005 and therefore, entire ITA 6491/M2012 & Nancy Icon Builders and Developers housing project was to be completed by 31 March 2011. Therefore, the claim of assessee under section 80 IB was disallowed.
Before learned Commissioner (Appeals) the assessee urged that clause (a) of section 80 IB(10), which imposes the condition regarding commencement and completion of the housing project and explanation (ii) to section 80 IB(10) clarifies that the date of completion of housing project is the date on which completion certificate is issued by local authority. It was further contended that provision of section 80IB(10) did not envisage any process, where the assessing officer had to conducting inquiry with regard to the completion of the project beyond the certificate issued by the local authority.
The assessee has further contended that the beneficial provision of exemption generally be strictly interpreted but beneficial deductions having their purpose for encouragement or promotion of certain activities should be liberally interpreted. The assessee further explained that building plans within Pune Municipal limits are governed by Development Control Rules, which needs to follow and subsequent to which the occupancy certificate is issued. It was further contended that the issuance of occupancy certificate is not merely a formality but a full-fledged procedure which includes inspection by the local authority. The assessee explained that occupancy ITA 6491/M2012 & Nancy Icon Builders and Developers /completion certificate was issued by Pune Municipal Corporation in three parts.
(i) In first part it was issued on 14th March 2008 with regard to 8 flat in block A, 7 flat in Block B and 05 flats in Block C, total 20 flats. (ii) In second part on 07th March 2008, for 23 flats in Block A, 25 flat in Block B, 23 in block C, 35 in block D, 32 in block E and 36 in bock F total 174. (iii) In third part on 30.03.2010 for 12 flats in block A, 11 flats in block B, 15 flats in block C, 8 flats in block D, 11 flats in block E, 7 flats in block F, 41 flats in Block G, 41 flats in Block H and 43 in block J- total 189, and overall completion in respect of total flats 383.
After considering the contention of assessee the landed Commissioner (Appeals) observed that project consist of 9 buildings i.e A, B, C, D, E, F, G, H and J, the area of the plot under the housing project is 60630.59 m² which is more than one Acre. The area of each residential unit is more than 1500 Sq ft. The project was duly approved by local authority vide its approval dated 31st of December 2005, this fact is confirmed as per tax Audit report under Form No 10CCB. The housing project does not contain any commercial unit. The assessee is following project completion method for recognition of revenue from the project and the assessee accordingly recognized revenue on handing over of the possession. The assessee got completion certificate from local authority in three parts viz; on 14 March 2008 for 20 flats, 174 flats on 17th March 2008 and for 189 flats on 30 ITA 6491/M2012 & Nancy Icon Builders and Developers March 2010. Therefore on the basis of facts regarding completion of housing project the assessee satisfied the conditions prescribed under clause (b), (c) and (d) of section 80 IB(10), which is otherwise not disputed by assessing officer. The assessing officer only disputed about the completion of the entire project.
The learned Commissioner (Appeals) further appreciated that the approval for the project was granted on 31.12.2005 (which is not disputed by AO) and, therefore the project ought to have been completed on or before the 31.03.2011. The assessee constructed housing project as per the sanction plan, which consist of 9 buildings and had a total FSI of 35,026.70 sq Mts comprised of 383 residential units. The assessee has consumed the entire FSI of the project in 383 residential units. (This fact is also not disputed by assessing officer).
Hon’ble Madras High Court in Viswas Promoters (P) Ltd Vs ACIT [2013] 29 taxmann.com 19 (Madras) while considering the claim of deduction under section 80IB(10) held that each residential block in a housing project is a 'housing project' in itself for purpose of claiming deduction under section 80-IB(10). The High Court also held that if going by definition of 'housing project' as given in section 80HHBA each block in a larger project ITA 6491/M2012 & ITA No. 7059/M/2014 Nancy Icon Builders and Developers had to be taken as an independent 'housing project' for purpose of claiming deduction under section 80-IB(10) and held that the assessee is entitled to have benefit of deduction for residential flats satisfying less than 1500 square feet condition. We have noted that similar relief, as had been claimed by the assessee, was granted by Calcutta Tribunal, in the case of Bengal Ambuja Housing Developments Ltd. (supra), which was confirmed by the Calcutta High Court in ITA No. 458/2006 by order dated 05.01.2007.
The Hon’ble Supreme Court in Bajaj Tempo Ltd Vs CIT 196 ITR 188 SC held that a provision in a taxing statute granting incentives for promoting growth and development should be construed liberally. Since a provision of section 80IB(10) is intended for promoting the need of the housing in the urban area , the provision has to be interpreted liberally the restriction on it too has to be construed so as to advance the objective of the section and not to frustrate it. Therefore, considering the facts of the case and the decisions of Madras and Calcutta High Court, we affirm the finding of the ld. Commissioner (Appeals).
The decision relied by ld. DR for the revenue is not helpful to the revenue as the factual matrix of those cases is more in favour of assessee. In Rahul Construction Co. Versus ITO (supra) the Tribunal held that the approval of ITA 6491/M2012 & Nancy Icon Builders and Developers the housing project and approval of building plan are different concept. In DCIT Vs Anand Ashok Gandhi (supra) the assessing officer disallowed deduction of section 80IB(10). On appeal ld. Commissioner (Appeals) allowed relief to the assessee on proportionate basis coordinate and on further appeal by revenue to Pune bench of Tribunal, the appeal of the revenue was dismissed. In Saroj Sales Corporation Vs ITO (supra) the assessing officer disallowed deduction under section 80IB(10) by blending two block( Nisarg and Breezy Corner) , the contention of assessee was that they have not claimed deduction in respect of ‘Breezy Corner’ which is mixed up by assessing officer. The Commissioner (Appeal) agreed with the action of assessing officer. However, on the appeal before Tribunal the assessee was granted deduction in respect of ‘Nisarg’ Finally the decision of Hon’ble Madhya Pradesh High Court in CIT Vs Global Reality it was held that when completion certificate of housing project was issued after cut off date by Local Authority, but mentioned date of completion of project before cut off date, same could not fulfill condition specified in section 80-IB (10)(a) read with explanation (ii) thereunder and assessee was not entitled to deduction under section 80-IB (10)(a), in our view these decision is more favorable to the assessee.
ITA 6491/M2012 & Nancy Icon Builders and Developers 15. In view of the above discussion the ground No.1 to 3 raised by the revenue are dismissed.
Ground No. 4 relates to treating the land cost of project at Rs. 25, 00,000/- against the cost treated by assessing officer at Rs.17.89 Crore. The ld. DR for the revenue submits that joint venture agreement was executed on 3rd February 2006 for developing the project. As per the agreement the net profit of the joint ventures is to be divided in the ratio of 42: 58. Further, the clause (31) of this agreement provides that the joint venture between the parties shall be dissolved or come to an end on completion of entire development work and after all the flats/row houses/ bungalows to be constructed by the parties, which thereon have been completed and sold and all the amounts receivable from the prospective purchases thereof have been received and the final accounts settled between them. Further, by way of supplementary deed wherein in para (3) it is mentioned " That the first party due to extraneous circumstances and diverse commitment is not in a position to undertake or contribute toward his task and obligation and also is over burdened with other commitment and, therefore, is unable to devote his time and attention to this venture, the first party has agreed to accept 27% of gross sale proceeds received from undertaking and fixed and mutually ITA 6491/M2012 & ITA No. 7059/M/2014 Nancy Icon Builders and Developers quantified amount toward his share of profit inclusive of land cost irrespective of profit or loss of the joint ventures." The ld. DR for the revenue further submits that conjoint reading of these two agreements made to make it clear that in any case 27% of gross sale proceed of the project has been benchmarked which is a compensation of cost of the land. Therefore, the assessing officer has rightly deducted this cost from the profit of the project.
On the other hand the ld. AR for the assessee supported the order of the learned Commissioner (Appeals). The ld. AR for the assessee further submits that Nitika Builder & Developers of Ulhasnagar and Ali Zafari of Pune entered in to agreement for development of land owned by Ali Zafari.
Both parties by executing the joint venture agreement dated 03.02. 2006 formed an association of person (AOP) i.e. the assessee to develop the housing project. As per clause 9B(iii) of joint venture agreement the development right was determined at Rs. 25.00 lakhs, which was brought in the capital of Ali Zafri and the value at which the right were brought in the joint venture and the said cost was debited to work in progress (WIP) accounts for financial year 2005-06 relevant to assessment year 2006-07.
Therefore, the view taken by the assessing officer that cost of land has not ITA 6491/M2012 & Nancy Icon Builders and Developers been debited to the books of accounts is misconceived and the assumption of taking the land cost at Rs.17,79,83,229/- is basically without any basis. The ld AR for the assessee invited our attention to section 45(3) of the Act and contended that this section provide that profit and gain arising from the transfer of capital asset to or otherwise shall be chargeable to tax and for this purpose the amount recorded in the books of account will be treated as full value of contribution received as a result of transfer of the relevant asset.
Thus, it was submitted that was transaction is covered by section 45(3), the sale consideration or deemed sale value of asset has to be valued at which the asset is brought in the books of account of AOP person and the sale value of any asset for transfer of is the purchase cost for transferee and, therefore, deemed sale value of the diet as per provision of section 45(3) is the value recorded in the assessee's books, which is Rs. 25 Lacs in the present case, which has been debited in the books of account which is evident from the work in progress account shown during the assessment year 2006-07. Therefore, the observation of the assessing officer that the profit of the housing project has been computed without considering the land cost is not correct. The assessing officer as wrongly assumed that Rs.17.79 Crore was paid to Ali Jaffri was on account of cost of land by relying upon ITA 6491/M2012 & Nancy Icon Builders and Developers supplementary deed. In fact the amount paid to Ali Jaffri was Rs. 6.92 Crore and not Rs. 17.79 Crore, which is evident from the ledger account of Ali Jaffri, which was not considered by assessing officer. The amount was paid to Ali Jaffrey on account of his share in the profit of AOP. The ld AR of the assessee submits that the learned Commissioner (Appeals) appeal granted relief to the assessee after appreciating various clauses of joint venture agreement.
We have considered the rival submissions of the parties and have gone through the orders of the authorities below. The assessee officer took his view on the basis of joint venture agreement which consist of various functions and duties to be performed, like construction, funding, supervision.
Thus, on the basis of his observation the assessing officer noted that Ali Jaffrey, the landowner had to receive 27% of the gross sale proceed for his share of profit, which is inclusive of land cost. Therefore, the assessing officer assumed that receipt of 27% of the sale of gross proceed toward the share profit that is Rs. 17.79 Crore relates to cost of land. The ld CIT(A) after examining the capital contribution in AOP as per clause 9B(iii) of joint venture agreement dated03.02.2006, which is valued at Rs. 25 Lacs. The learned CIT(A) further observed that profit and gain arising from the transfer ITA 6491/M2012 & Nancy Icon Builders and Developers of capital asset to another entity by way of capital contribution or otherwise chargeable to tax and for this purpose the amount recorded in the books of account of AOP is deemed to be the full value of consideration received or accrued as a result of transfer of relevant asset. Therefore, capital contribution brought in the asset of assessee as a member of AOP, Ali Jaffri contributed Rs. 25 lakhs. Hence, the deemed sale value of the tight as per the provision of section 45(3) is the value recorded in the assessee's book of account is only Rs. 25 lakhs, which has been debited in the WIP account for assessment year 2006-07. We have noted that the assessing officer has not examined the capital contribution of Ali Jaffrey recorded in the books of account of AOP/ assessee. Therefore the adoption of Rs. 17.89 Crore as value of land assumed by assessing officer as a cost of land is without any basis. Hence we do not find any force in the grounds of appeal raised by the revenue/ assessing officer.
19. The coordinate bench of Tribunal in Bombay Real Estate Development Pvt Ltd in ITA No. 6504-05/M/2008, 8478/M/2007 while considering the similar set of fact held that section 45(3) does not permit the assessing officer to substitute the full value of consideration other than the amount recorded in the books of the account of the joint venture. No contrary fact or ITA 6491/M2012 & ITA No. 7059/M/2014 Nancy Icon Builders and Developers law is brought to our notice to take a contrary view. Thus, we do not find any illegality or infirmity in the order passed by learned Commissioner (Appeals). Resultantly, this ground of appeal raised by revenue is dismissed.
In the result, appeal filed by Revenue is dismissed.
In appeal for Assessment Year 2010-11, the Revenue has raised the following grounds of appeal:
(1) On the facts and circumstance of the case and in law, the CIT(A) erred in granting the deduction u/s 80IB to the assessee. (2) On the facts and circumstance of the case and in law, the CIT(A) has not appreciated the fact that the original sanction was accorded to not only to the buildings but also to the amenities, like parking, club house etc. It is only after completion of the buildings and these amenities, the project can be said to be complete. As the completion certificate in respect of club house, parking was still pending up to date of assessment; the project in totality was incomplete. The PMC Authorities granted completion certificate in respect of constructed buildings and not the entire project. (3) On the facts and circumstance of the case and in law, the CIT(A) has not appreciated the fact that constructed buildings and unconstructed club house and parking cannot be considered as separate project as originally sanctioned plan contained amenities like parking space and club house also.
Brief facts of the case are that the assessee filed its return of income for assessment year 2010-11 on 07.10.2010. In the return the assessee claimed ITA 6491/M2012 & Nancy Icon Builders and Developers deduction under section 80 IB (10) for Rs. 2,78,39,032/-. The assessment was completed on 30 March 2013 under section143 (3). The assessing officer while passing assessment order disallowed the deduction claimed under section 80 IB(10) holding that the project was not complete as on 31st of March 2011 and the condition prescribed under the provision of section 80 IB(10) are not fulfilled, therefore, the assessee is not entitled for such deduction. On appeal before learned Commissioner (Appeals), the assessee was allowed deduction on the basis of decision of learned Commissioner (Appeals) for assessment year 2009-10. Therefore, aggrieved by the order of learned Commissioner (Appeals) the revenue has filed present appeal before us.
We have noted that the ld. learned Commissioner (Appeals)while passing impugned order followed the order for assessment years 2009-10 and granted relief to the assessee. As we have already noted that the grounds of appeal
raised by the revenue in both the appeals related to deduction claimed under section 80IB(10) are common. We have already upheld the order of learned Commissioner (Appeals) for assessment year 2009
10. (supra) by fully endorsing the order of learned Commissioner (Appeals) for assessment years 2009-10. Therefore, considering the principle of consistency the ITA 6491/M2012 & ITA No. 7059/M/2014 Nancy Icon Builders and Developers appeal for this assessment year 2010-11 is also dismissed with similar observation.
In the result, appeal filed by Revenue is dismissed.
Order pronounced in the open court on 11.07.2018.