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Income Tax Appellate Tribunal, “E ” BENCH, MUMBAI
Before: SHRI RAJENDRA & SHRI C.N. PRASAD
आदेश / O R D E R PER C.N. PRASAD, JM:
This appeal is filed by the Revenue against the order of the Ld. CIT(A)-II, Mumbai dated 04.09.2014 pertaining to assessment year 2010-11.
The Revenue has raised the following grounds:
1. "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT{A) has erred in deleting an amount of Rs.1,07, 66,186/- being disallowance made on account of wrong claim of deduction u/s 80IB(10) of the I.T Act, 1961".
2. "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT{A) has erred in allowing deduction u/s 80IB(10) even when the area of the plot on which the housing project was developed is only 3932 sq. mtrs which is less than 1 acre. As per the provisions of the Act, the area of plot should be at least 1 acre in area.
3. "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT{A) Thane erred in allowing the claim u/s 80IB(10) even though the commercial areas of 2406.70 sq. ft. in the housing project exceeded 5% or 2000 sq. ft. of the built-up area whichever is less. This is a violation of the criteria specified under the provisions of the Act".
4. "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT{A) erred in allowing deduction U/S. 80IB(10) even when the project was not completed before 31/03/2008 as per the provisions of the section".
5. "Whether on the facts and in the circumstances of the case and in law the Ld. CIT{A) erred in allowing deduction u/s 80IB(10) despite the fact that the assessee himself has admitted in his statement recorded under oath during the course of survey that he is not eligible for deduction u/s 80IB(10) of the Act".
At the outset, the Ld. Counsel for the assessee submits that the issue in appeal of the Revenue has been decided in assessee’s own case for the immediately preceding Assessment Years 2009-10 and 2008-09 in & 4837/M/2012 dated 21.12.2015 wherein the Co-ordinate Bench dismissed the appeal of the Revenue by affirming the order of the Ld. CIT(A) in allowing assessee’s claim of deduction u/s. 80IB(10). Copy of the order is placed on record. The Ld. Counsel for the assessee further submits that ground No. 2 of the grounds of appeal of the Revenue regarding area of the plot has been dealt with by the Co-ordinate Bench in para-12 of the order. Ground NO. 3 raised by the Revenue regarding violation of the criteria specified under the provisions of the Act has been dealt with in para-13 of the Tribunal’s order. With respect to ground No. 4 and ground No. 5 raised by the Revenue in its appeal, the Ld. Counsel for the assessee submits that both these grounds have been dealt with by the Tribunal in para-14 & 15 of the Tribunal’s order respectively. Therefore, he pleads that the order of the Co-ordinate Bench may be followed for this Assessment Year also.
The Ld. Departmental Representative placed reliance on the order of the Assessing Officer.
We have heard the rival submissions, perused the orders of the authorities below and also gone through the decision of the Co- ordinate Bench in assessee’s own case for the earlier Assessment Years and we find that the issue is squarely covered by the said decision wherein the Co-ordinate Bench exhaustively dealt with the issue and uphold the order of the Ld. CIT(A) in allowing the claim of the assessee for deduction u/s. 80IB(10) of the Act by observing as under:
11.We have considered the submissions of the parties and perused the material available on record. It is evident from the facts on record the Assessing Officer has disallowed assessee’s claim of deduction under section 80IB(10) for following three reasons:– (i) Area of plot is less than one acre; (ii) Commercial area is more than 5% of built–up area; and (iii) Assessee has not obtained completion certificate prior to 31st March 2008.
As far as the first objection of the Assessing Officer that land area of the project is less than one acre, it is apparent and obvious that the Assessing Officer has calculated the area of land at 3,932 sq.mtrs., after excluding road set–back of 342 sq.mtrs. In our view, the aforesaid approach of the Assessing Officer is totally unacceptable. As per records, the total area of the project, as per revised approved plan is 4460 sq.mtrs including the area for road set–back. Therefore, the Assessing Officer is factually incorrect in concluding that plot is less than one acre. Moreover, assessee’s contention that additional FSI of 342 sq.mtrs. if taken into consideration would make the plot area 4,274 sq.mtrs., which is more than one acre appears to be correct. As the Department has failed to controvert the aforesaid factual position with any documentary evidence, we are unable to accept the view of the Assessing Officer, therefore, the first objection of the Assessing Officer that the area of plot is less than one acre is not acceptable.
As far as the second allegation of the Department that commercial area is less than 5% of the total built– up area, the same is also found to be factually incorrect in view of the documentary evidence submitted by the assessee not only before the Departmental Authorities but at this stage also. It is not disputed that in course of original assessment proceedings for the impugned assessment year, the Assessing Officer has specifically examined this issue and after verifying the approved plan and revised approved plan, has found that the commercial area is less than 5% of the total built–up area. The same view was again expressed by the Assessing Officer in the assessment order passed under section 143(3) of the Act for the assessment year 2006– 07. The Department has not controverted the aforesaid factual position by bringing any material on record. In view of the aforesaid, we do not find any infirmity in the order of the learned Commissioner (Appeals) in accepting assessee’s claim of deduction under section 80IB(10) as the assessee has factually proved that commercial area is less than 5% of the total area of plot.
As far as the allegation of the Department that a partner of the assessee firm has accepted that it is not eligible for deduction under section 80IB(10) on going through the statement of the partner, recorded on 31st July 2008, a copy of which was submitted before us, we do not find the allegation of the Departmental Authorities to be correct. On the contrary, the observation of the learned Commissioner (Appeals) in Para–11.8 of the order passed for assessment year 2008–09, is correct as the partner has only stated that the claim of deduction under section 80IB(10) is not available on the addition income offered by the firm.
As far as the last allegation of the Department that completion certificate obtained by the assessee is beyond 31st March 2008, we are of the view that deduction under section 80IB(10) cannot be denied to the assessee on such purely technical objection. Moreover, on a perusal of the completion certificate issued by Meera Bhyander Municipal Corporation, which is submitted in the paper book with English translated version, it is very much clear that the said certificate clearly mentions that the assessee has applied for completion certificate not only before 31st March 2007 but the project was complete in all respect by 29th March 2008. In this factual background, merely because the certificates were issued by municipal authorities in May 2008, would not deprive the assessee form enjoying the deduction under section 80IB(10). Moreover, as rightly submitted by the learned counsel, the principle laid down in the judicial precedent if taken note of make it clear that the date of grant of completion certificate by the municipal authorities would revert back to the date of application by the assessee. If the assessee had applied before the due date and completion certificate is issued by the competent authority without any clarification then the project should be deemed to have been completed before the due date. In the facts of the present case, there is no dispute or doubt that the municipal authorities have accepted that project was completed before 31st March 20008. Hence, in our view, assessee’s claim of deduction under section 80IB(10), cannot be denied on the ground that it has failed to obtained certificate from the competent authority before the due date i.e., 31st March 2008. Therefore, on over all consideration of facts and material on record, we are of the firm view that learned Commissioner (Appeals) was justified in allowing assessee’s claim of deduction under section 80IB(10). In view of the aforesaid, we uphold the order of the learned Commissioner (Appeals) by dismissing the ground raised by the Department for the assessment year 2005–06.
The facts and issue being similar in ITA no.4837/Mum./2012, for the assessment year 2008–09 and ITA no.4838/Mum./2012 for assessment year 2009– 10, following our order of the assessment year 2005–06, we uphold the order of the learned Commissioner (Appeals) by dismissing the grounds raised by the Department”.
Respectfully following the said decision, we uphold the order of the Ld. CIT(A) in allowing the claim of deduction u/s. 80IB(10) for the Assessment Year 2010-11 also.
In the result, the appeal filed by the Revenue is dismissed.
Order pronounced in the open court on 23rd September, 2016.