Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (11) TMI 425 - AT - Income TaxDeduction u/s 80IB of the Income Tax Act – Disallowance u/s 80IB for not obtaining the OC /CC before a particular date – Held that:- First sanction to construct the project was received on 26.12.2003 i.e. before 1.4.2004.Therefore, amendment brought in the section was not applicable to the facts of the present case - Secondly, sub-section, nowhere stipulates that 20% area should to increased for computing the built up area of a residential unit – Decided in favor of Assessee. Reliance has been placed on the decision of Karnataka High Court in the case of G.R. Developers [2012 (7) TMI 91 - KARNATAKA HIGH COURT ],wherein it was held that a valid approval is obtained and the building is constructed in all respects prior to 1-4-2005 and the substituted provision of ‘built up area’ inserted in sub-section (14) of the section 80IB is held to be applicable retrospectively, the assessee would not be entitled to the benefit of tax exemption, as the assessee effects sales subsequent to 1-4-2005.Such an interpretation not only would be absurd but would have disastrous consequences so far as the assessee is concerned. Therefore, it cannot be said that such was the intention of the legislature while bringing in the substitution. So, one should keep in mind the object behind enacting this provision, namely, to bring in investments and to encourage the infrastructure development of middle income housing projects. If the aforesaid provision is held to be retrospective in nature, it would negative the object of the said provision. It is settled law that the Courts have to harmonize these provisions and interpret the same in a manner to achieve the object of the legislature than to distress the said object. In that view of the matter, the definition of built-up area as inserted in sub-section (14) of section 80-IB by Finance (No.2) Act of 2004, which came into effect from 1-4-2005, cannot be held to be retrospective; It applies only to such housing projects, which are approved subsequent to 1-4-2005 – Decided against the Revenue. Disallowance of entire deduction under section 80IB of the Act because area of 10 flats was more than the area prescribed by the Act – Held that:- Reliance has been placed on the judgment of the Madras High Court in the case of Viswas Promoters (P) Ltd [2012 (11) TMI 1117 - MADRAS HIGH COURT], wherein it was held that within a composite housing project, where there are eligible and ineligible units, the assessee can claim deduction in respect of eligible units in the project and even within the block the assessee is entitled to claim proportionate relief in the units satisfying the extent of the built up area - Considering the above even if claim was to disallowed it should have been restricted to ten flats only – Decided against the Revenue. Deduction u/s 80IB - If the size of the flats was more than 1000 Sq.ft., assessee was entitled to claim the deduction because the housing-project-in-question was 25 Kilometers away from the City of Mumbai – Held that:- Bombay Municipal Corporation Act defines certain words used in the Act. Similarly, Bombay General Clause Act, 1904, The Greater Bombay Laws and Bombay High Court (Declaration of limits) Act 1945, and Maharashtra Land Revenue Code 1966 have also defined the word "City of Mumbai" - Words "City of Bombay" do not convey the same meaning as the words Greater Mumbai or Greater Mumbai Municipal Corporation. If the distance between City of Mumbai and location of the project was more than 25 Kms by road, the limit of size of the residential unit will change. If the distance is held to be more than 25 Kms., permissible size of the flats would be 1500 sq ft. Therefore, in the interest of justice, matter should be remitted back to the file of the FAA for fresh adjudication.
|