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Income Tax Appellate Tribunal, “D” BENCH, MUMBAI
O R D E R PER MAHAVIR SINGH, JM:
These two appeals by assessee are arising out of the different orders of CIT (A)-25, Mumbai in appeal Nos. CIT(A)-25/IT-152 & 192/14 (3) (4)/2012-13 vide even date 01-01-2014. The assessments were framed by ITO ward-14(3)-4, Mumbai for the assessment years 2010-11 & 2011-12 vide different orders dated 31-01-2013 & 14-03-2013 u/s 143(3) of the Income Tax Act, 1961 (hereinafter ‘the Act’).
The only common issue in these two appeals of assessee is as regards to the orders of CIT (A) disallowing the claim of deduction u/s 80IB (10) of the Act for want of evidence that the project was completed within this stipulated time limit i.e. 31-03-2013. For this assessee has raised various grounds in both the years and for the sake of convenience and brevity we are reproducing the grounds from the A.Y. 2010-11 as under:-
“1. The learned Commissioner of Income Tax (Appeals) erred in confirming the disallowance of deduction u/s 80IB (10) of the Income Tax Act, 1961 for Rs.1,72,53,670/-
2 1532/Mum/2014 2. The learned Commissioner of Income Tax (Appeals) erred in stating that the appellant was unable to prove that the project was completed within the stipulated time limit i.e. till 31st March 2013.
3. The appellant submits that during the course of appellate proceedings, the appellant was never asked to file or to produce completion / occupation certificate The appellant has obtained the Occupation Certificates for Towers “A”, “B”, “C” on 26th February, 2013 and for Towers, “D”, Ë”, Club House & Bank Premises on 4th March, 2013. Further the Building completion Certificate (BCC) for Towers Ä””B”, “C”, “D”,Ë”, Club House and Bank Premises was issued on 18th March, 2013.
The learned Commissioner of Income Tax (Appeals) failed ot consider that in the letter dated 1st August, 2013 withdrawing the claim for deduction u/s 80IB(10) for the A.Y. 2012-13, the appellant has never stated that the project was not completed before 31st March, 2013.
5. The appellants have filed the revised return of income for the A.Y. 2012-13 on 3rd march, 2014 claiming the deduction u/s 80IB (10) of the Act."
The assessee has developed the Housing Project known as Mayuresh Residency at Bhandup (west), Mumbai. The assessee claimed deduction u/s 80IB (10) of the Act on account of profit arising out of this project by claiming that it has satisfied all the conditions as provided in the provision of section 80IB (10) of the Act. The assessee referred to following conditions:-
(a) Party should obtain Occupation Certificate within 5 years from the end of the financial year in which the housing project was approved by the L0 .r Planning Authority i.e. on or before 313t March, 2013. (b) The area of the project should be more than 1 Acre or 4048 Sq. Mtrs. c) The built up area of the residential flat should not be more than 1000 sq.ft. d) The built up of the shopping should not be more than 3% of the total built up area of the project or 5000 sq.ft. Whichever is higher. e) The units so proposed to be constructed in the said project, is allotted only to the single individual and not than one unit is allotted to the same individual or to his spouse or his children or to his HUF.
3 1532/Mum/2014 The Assessing Officer pointed out that in this project the assessee has sold flats to one family i.e. Shri Subash D. Yadav, Shri Desai U. Yadav and Smt. Neeta Anand Yadav and accordingly, the assessee is not eligible for claim of deduction in view of the conditions mentioned u/s 80IB (10) (e) and (f) of the Act. Accordingly, he disallowed claim of deduction u/s 80IB (10). Aggrieved assessee preferred appeal before CIT (A), who allowed the claim of deduction on the issue of allotment of flats to the members of same family by observing as under:-
“(ii) Conditions laid down u/s 80IB (10 (e) & (f): I find that the appellant ahs not allotted more than one residential unit to any individual, or to spouse or minor children of any individual to whom any other residential unit is already allotted. Therefore, the said conditions are not contravened by the appellant.” But, CIT (A) confirmed the disallowance of deduction u/s 80IB on the reasoning that the project was approved as on 10-09-2007 i.e. in the financial year 2007-08 and project was not completed up to 31-03-2013 as conditions prescribed in the provisions of 80IB(10)(a)(iii) of the Act. The CIT (A) disallowed the claim of deduction u/s 80IB (10) of the Act by observing as under:-
“(i) Condition laid down u/s 80IB (10 (a) (iii): One of the conditions for eligibility of deduction u/s 80IB (10) is that (a) such undertaking has commenced or commences development and construction of the construction of the housing project on or after the 1st day of October, 1998 and completes such construction….(iii) in case where a housing project has been approved by the local authority on or after the 1st day of April, 005, within five years from the end of the financial year in which the housing project is approved by the local authority”. In present case, the approval is received on 10-09-2007 i.e. FY 2007-08, and hence the project needs to be completed within five years from the end of said FY i.e. up to 31-03-2013. I find it to be an undisputed fact that the appellant was unable to prove that the project was completed by producing the Completion/Occupation Certificate at the time of assessment, and also thereafter within the stipulated time limit i.e. till 3-03-2013. During appellate proceedings also, the appellant has been unable to prove the compliance of this condition within the stipulated time limit. Therefore, on this ground, the appellant is not entitled to get deduction u/s 80IB (10).” For this finding he also placed reliance on the withdrawal of claim by assessee u/s 80IB (10) for assessment year 2012-13.
4 1532/Mum/2014 4. We find that the Revenue is not appeal against the findings of CIT (A) that assessee has not allotted more than one residential unit to any individual, or to spouse or minor children of any individual to whom any other residential unit is already allotted. Accordingly, he held that the conditions are not contravened in respect of the provisions of section 80IB (10) (e) & (f) of the Act. This finding is unchallenged and revenue is not in appeal against this finding. But, aggrieved, against the withdrawal of deduction u/s 80IB (10) of the Act for non completion of project up to 31-03-2013, the assessee is in second appeal before Tribunal.
We have heard rival contentions and gone through the facts and circumstances of the case. Before us the learned Counsel for the assessee Shri Percy Pardiwala took us through the completion certificate granted by BMC vide dated 10- 09-2007 in respect of this project, which is enclosed at pages 13 to 25 of assessee paper books. The learned counsel further took us through occupation certificate issued by Municipal Corporation of Grater Mumbai vide CE/1154/BPES/AS dated 26-02-2013 and also another approval CE/1154/BPES/AS dated 04-03-2013 this approvals covers full occupation permission for blocks “A”, “B”, “C”, “D” and “E” of building comprising of stilt + 1st to 19th + (part) 20th upper floors and ground floor of this project. These approvals are enclosed at pages 33-37 of assessee’s paper book. As regards to the withdrawal of claim for AY 2012-13, the learned Counsel for the assessee stated that due to wrong impression, the assessee first withdrawn his claim and then revised the same claim before the AO by filing a revised return for AY 2012-2013 dated 03-03-2014 during the pendency of assessment proceedings. The learned counsel for the assessee informed that this claim is pending before CIT (A) for the AY 2012-13. In view of the above facts, the learned Counsel for the assessee stated that the building was completed on 31-03-2013 and not otherwise, as alleged by the CIT (A) in his order. We find from the above facts that the project is completed and occupation in respect of all the blocks that is “A”, “B”, “C”, “D” and “E” are obtain within stipulated time limit of 31-03-2013 and there is no violation of any of the conditions mentioned in the provisions of Section 80IB (10) of the Act. Accordingly we have no hesitation in allowing this claim of assessee and accordingly the same is allowed.
In the result, both the appeals of the assessee are allowed. Order pronounced in the open court on 03 -11-2016.