ASST CIT CIR 1, KALYAN vs. GAURI VINAYAK BUILDERS & DEVELOPERS P.LTD, KALYAN

Facts in brief are that the assessee filed its return of income on 30.9.2010 declaring total income of Rs.31,51,680/-. The case of the assessee was selected for scrutiny and the statutory notices u/s 143(2) and 142(1) were 2 issued and served on the assessee. The assessee is a builder and undertook various projects during the year and also claimed deduction u/s 80IB(10) of the Act to the tune of Rs.1,28,34,603/-. At the outset, the ld. AR rightly pointed out that the ld.CIT(A) by following the decision of its predecessor in the assessment year 2008-09 allowed the claim of the assessee and the revenue has not challenged the said decision before the higher forum and hence it has attained finality, whereas in the current year the department has filed appeal against the order of ld.CIT(A). The AR, therefore, submitted that the appeal of the department should be dismissed as it has no locus standi to file the appeal in the current year, in view of the facts that the issue has attained finality in the assessment year 2008-09.

The ld. DR fairly conceded that the argument raised by the ld.AR as true and correct and also brought the facts to the notice of the Bench that at the time of making assessment, the decision of the FAA was not available before the AO and the AO has specifically stated at page 5 of the assessment order that in the event the issue is decided by the ld.CIT(A) in favour of the assessee and allowed deduction u/s 80IB(10) of the Act, the decision of the ld.CIT(A) will be applicable to the present year also. 4. We have heard both the parties and perused the material placed before us including the orders of authorities below. We find that an identical issue has been decided by the ld. CIT(A) in favour of the assessee which attained finality 3 due to non-filing of the appeal by the revenue before the higher forum and in the current year the issue has been decided by the ld. CIT(A) in favour of the assessee by following the order of his predecessor, which is extracted below : “5.1 After considering the issue at great length, I am of the considered view that the project of the assessee has commenced on 21.4.2005, and hence, the terms of the provisions of clause (a) of section 80IB(10) the project could have been completed within four years from the end of the financial year 2005-06. As the project is completed on 17th October, 2009 as held by my predecessor that the project was completed within the prescribed time limit as per clause (a) of section 80IB (10). Also, the area of shops was less than 5000 sq.ft. Therefore, deduction u/s 80IB(10) is allowed.

The facts of the instant case being the identical to that of assessment year 2008-09 and therefore, following the precedent in the earlier year we are inclined to decide the issue in favour of the assessee and against the revenue.