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2015 (2) TMI 1279 - AT - Income TaxClaim of deduction u/s. 80IB(10) - flats no.403 and 404 exceeded threshold limit of 1500 sq.feet as per section 80IB(10)(c) - Held that:- The residential units with all rights and title stood transferred much before insertion of clause (f) in section 80 IB(10) by the Finance Act, 2009 w.e.f. 01.04.2010 having prospective effect only. The assessee has recognized the said receipts in the relevant previous year as per its system of accounting regularly followed. We find that a co-ordinate bench of the ‘tribunal’ in Emgeen Holdings (P) Ltd vs. DCIT (2011 (5) TMI 958 - ITAT MUMBAI) has held that this amendment would only have prospective effect. It is an undisputed fact that the assessee’s residential units stood transferred to the aforesaid vendees well before the amendment We reiterate that section 80IB(10) is a deduction provision to be liberally construed. Therefore, the assessee succeeds so far as application of clause (f) of section 80IB(10) is concerned. For flats no.403 and 404 measure more than 1500 sq.feet i.e. 1653 and 1572 sq.feet respectively. The assessee fails to rebut this factual position. Section 80IB(10)(c) prescribes measurement of a residential unit to be upto 1500 sq.feet only. The language used in this specific clause refers the residential unit. This expression does not bar a deduction claim altogether if some of the units sold exceed the specified dimensions. In such a case, the consequential disallowance has to be proportionate only. It has to be restricted to profits derived from the residential units violating section 80IB(10)(c). Case law CIT vs. ARUN EXCELLO FOUNDATIONS (P) LTD (2012 (12) TMI 415 - MADRAS HIGH COURT) is also quoted in support - Decided in favour of assessee partly.
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