Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (9) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (9) TMI 247 - AT - Income TaxClaim for deduction u/s 80IB(10) - consideration of unutilized FSI - Held that:- In the case the operation of unutilized FSI is exorbitant i.e. more than 30% of the total permissible area then the matter has to be looked into from a different angle and one cannot ignore the possibility of the situation wherein claim under section 80IB(10) is intentional deduction from sale of unutilized FSI on which no construction or development has been done and for mere sale of such unutilized land or portion deduction u/s 80IB(10) of the Act is claimed. We find that in the case of assessee almost 60% of the permissible FSI remained unutilized i.e. no construction was made thereon. As per the working appearing in the assessment order, we find that in the project Vaikunth-I permissible FSI was 1423.7 sq.m. and FSI utilized for construction was 571.81 sq.m. which left behind unutilized FSI at 851.89 sq.m. Now observing these facts of the case in the light of judgments of Hon. Jurisdictional High Court, we find that Hon. High Court in the case of Moon Star Developers (supra) came across the fact that only 23% of the FSI was utilized and decision was given in favour of Revenue by confirming the disallowance made for sale of unutilized FSI. However, it was also observed by Hon. High Court that utilization of FSI has to be introspected with the overall project and one has to keep space for the margin for keeping some portion of FSI unutilized depending on case to case. We observe that the same Hon. Bench of the Jurisdictional High Court which has decided the issue in favour of Revenue in the case of Moon Star Developers (2014 (4) TMI 1042 - GUJARAT HIGH COURT ) had dealt with similar issue of allowability of deduction u/s 80IB(10) of the Act for sale of unutilized FSI in the case of M/s Shreenath Infrastructure (supra) and came with the view that 25-30% of non-utilisation of FSI is permissible and assessee should not be devoid of claiming deduction u/s 80IB(10) of the Act. Respectfully following the judgment of Hon. Jurisdictional High Court in the case of Shreenath Infrastructure (2014 (4) TMI 482 - GUJARAT HIGH COURT) we are of the view that assessee should be allowed to claim deduction u/s 80IB(10) of the Act to the extent of 30% of unutilized FSI. We hereby deem it fit to sustain the disallowance to 50% as the assessee has 60% unutilized FSI and after giving the benefit of 30% unutilized FSI. Accordingly, assessee will get relief of ₹ 3,01,869.50 as against disallowance made at the time of assessment at ₹ 6,03,739/-. Accordingly, this ground of Revenue is partly allowed.
|