ASSTT. COMMISSIONER OF INCOME TAX, CIRCLE-5 PUNE, PUNE vs. SURANA MUTHA BHANSALI DEVELOPERS, PUNE
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Income Tax Appellate Tribunal, PUNE “B” BENCH : PUNE
Before: SHRI SATBEER SINGH GODARA & DR. DIPAK P. RIPOTE
PER SATBEER SINGH GODARA, J.M. :
This Revenue’s appeal I.T.A.No.673/PUN./2024 and
assessee’s cross objection C.O.No.26/PUN./2024, for
assessment year 2013-14, arises against the National Faceless
Appeal Centre [in short the “NFAC”] Delhi’s Din and Order No.
ITBA/NFAC/S/250/ 2023-24/1060625210(1), dated
07.02.2024, involving proceedings u/s. 143(3) of the Income
Tax Act, 1961 (in short “the Act”).
Heard both the parties. Case file perused.
2 ITA.No.673 & CO.26/PUN./2024
It emerges at the outset that the Revenue’s sole
substantive grievance in the instant appeal ITA.No.673/PUN./
2024 seeks to revive the Assessing Officer’s action disallowing
the assessee’s sec.80IB(10) deduction claim of
Rs.1,55,29,089/-; made in the course of assessment dated
31.03.2016, as reversed in the CIT(A)-NFAC's order to this
effect reading as follows :
“4. DECISION
4.0. Ground Nos 1 is raised with regard to the
disallowance of deduction under sec.80IB(10) of the IT Act.
4.1. During the assessment proceedings the AO to
ascertain the eligibility condition of the assessee's project
u/s.801B(10) of the Act issued a commission u/s.
131(10)(d) of the Act to the Government approved valuer,
Mr. Nitin Lele and to submit his report in this matter. He
submitted the report and after observing the valuers report
and the definition of built up area about inclusions in the
built up area, it is observed that -
i. 40 such units where terrace is given internal exclusive to assessee. The terrace talked about here is not the rooftop terrace. It is the terrace, the access to which is through the flat of the purchaser and which is at the floor level and is the terrace of the immediately lower flat.
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ii. In the valuer report unit in B wing 101 is measured and found that the area is 1453.66 sq. ft. also the drawing from Architect is submitted along with the submissions. The floor flats of all building are allotted along with the submissions. The floor flats of all buildings are allotted a top terrace above the flat having area same as a flat. The area such 3 BHK flats is 1453.66 sq. ft with terrace area of flat 1227.48. sq. ft. Hence total allotted area of those flats is 2681.50 sq. ft. there are 24 such flats on 11th floor of building A,B C F G & H.
iii. The area of such 2 BHK flats is 1151.31 sq. ft with
terrace area of flat 933.12 sq. ft. Hence total area
allotted to those flats is 2084.83sq. ft there are 16
such flats 4 flats on 11th floor of buildings D E I & J.
One of the conditions required u/s. 801B(10) of the Act is that the built up area of the flats should not exceed 1500 sq. ft. In assessee's project, as specified by the valuer, there are 40 such flats where the area of flats is more than 1500 sq. ft. Therefore, the assessee's project does not qualify for 80IB(10) deduction.
4.2. The appellant during the course of appellate
proceedings submitted that-
4.2.1 The assessment order for A.Y. 2013-14 was
agitated in appeal before the Hon CIT(A) for the
disallowance of the claim u/s.80(B(10), who had passed
the order granting proportionate claim u/s. 80IB(10).
4 ITA.No.673 & CO.26/PUN./2024
4.2.2. This order was agitated in appeal before the
Hon. ITAT. The Hon. ITAT vide its order dated 1.10.2019
restored the appeal to the file of the CIT(A) as the CIT() had
not considered the decisions cited by the assessee.
4.2.3. The relevant portion is contained in para 5 and
6 of the ITAT order. It may be noted that the issue before
the Hon Tribunal was the erroneous inclusion of terrace
area for considering the built up area of 40 units, claim for
which was disallowed by the CIT(A).
4.2.4. The exact issue was raised in an appeal filed
before the Hon. ITAT for A.Y. 2012-13 where the Hon. ITAT
vide it order dated 16.10.2019 has decided the appeal in
the favour of the assessee. The ratio of the said order
squarely covers the case for this A.Y. 2013-14 as the facts
are identical and relate to the same project.
4.3. I have considered the assessment order, facts
of the case, grounds of appeal, statement of facts and the
submissions made by the appellant during the appeal
proceedings. The Hon'ble ITAT vide order in ITA.No
568/Pune/2017 dtd.16.102019 in the appellant's own
case for the A.Y. 2012-13 as held as under :
"We have heard the rival submissions and
perused the material on record. We find that id CIT(A)
while granting partial relief to the assessee
5 ITA.No.673 & CO.26/PUN./2024
u/s.80IB(10) has noted that since assessee has
violated the conditions for claim of deduction u/s.
80IB(10) with respect to only 40 units which had
exceeded the permissible area, the deduction has to
be denied only for those 40 flats meaning thereby
that the assessee was granted deduction on
proportionate basis. For arriving at such conclusion,
Id. CIT(A) had relied on the decisions cited in his
order. Before us, Revenue has not pointed out any
fallacy in the findings of the Id.CIT(A) nor has
brought on record any contrary binding decision in its
support. We therefore do not find any reason to
interfere with the findings of Ld. CIT(A). Thus, the
grounds of Revenue are dismissed"
4.3.1. Respectfully following the decisions as cited
above and also relying on the decisions of Hon' Pune ITAT
in the cases of DCIT Vs. Pride Purple Sheth vide ITA.No.
424/Pun/2016 for the A.Y. 2011-12 dated 20.12.2017
and NT Wadhwani V. ACIT and others, the addition made
by the AO cannot be sustained and the appellant is
eligible for deduction u/s.80IB(10) of the Act on the profits
earned from the aforesaid housing project. The grounds of
appeal are allowed.
In the result, the appeal is 'allowed".
6 ITA.No.673 & CO.26/PUN./2024
Suffice to say, it has come on record that the Ld.
CIT(A)-NFAC has followed the tribunal’s order in assessee’s
own case for preceding assessment year 2012-2013 involving
the very residential project for the purpose of treating it eligible
for sec.80IB(10) deduction. The Revenue’s pleadings are
indeed very fair in not pinpointing any distinction on facts or
law; as the case may be; in both these assessment years. We
thus adopt judicial consistency to affirm the CIT(A)-NFAC's
impugned findings and reject the Revenue’s sole substantive
ground in it’s appeal ITA.No.673/PUN./2024.
Learned counsel submits that the assessee does not
wish to press of it’s cross objections C.O.No.26/PUN./2024.
Rejected accordingly.
To sum-up, this Revenue’s appeal
ITA.No.673/PUN./2024 is dismissed in above terms and
assessee’s cross objection C.O.No.26/PUN./2024 is dismissed
as withdrawn. A copy of this common order be placed in the
respective case files.
Order pronounced in the open Court on 28.08.2024.
Sd/- Sd/- [DR. DIPAK P. RIPOTE] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 28th August, 2024 VBP/-
7 ITA.No.673 & CO.26/PUN./2024
Copy to
The appellant 2. The respondent 3. The Pr. CIT, Pune concerned 4. D.R. ITAT, “B” Bench, Pune. 5. Guard File.
//By Order//
//True Copy //
Sr. Private Secretary, ITAT, Pune Benches, Pune.
