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2017 (4) TMI 530 - HC - Income TaxExemption under Section 80-IB - built, up "area" - Held that:- As decided in Commissioner of Income Tax Vs. Anriya Project Management Services (P.) Ltd. [2012 (5) TMI 196 - KARNATAKA HIGH COURT ] the definition of "built, up "area" inserted by Finance No. 2 of 2004 which name into of it of from 01.04.2005 is only prospective in nature. It has no application to the housing projects which were approved by the local authority prior to that date. Prior to 01.04.2005, in calculating the 1,500 sq. ft. of a residential unit, the area covered by a balcony was excluded. Therefore, the definition of built-up area which is now inserted has no applicable to constructions which were put up in accordance with the housing projects approved by the local authority prior to that date Submission of Revenue that Assessee sold residential units mentioning in sale deeds total area of flat which included area for balcony also, will have no relevance for question up for consideration, for the reason, that applicability of statutory provision has to be examined in the light of relevant statutory provisions and not behaviour of parties or manner in which they understood things. Thus questions (i) and (ii) are answered in favour of Assessee for the reason that specifications of flats have been considered by Tribunal in the light of rules of local bodies which approved plan. There was no otherwise restriction available in Section 80-IB(10) in respect of projects approved before 01.04.2005. - Decided in favour of Assessee Built up area of shops and other commercial establishment - Held that:- As considered applicability of amended provisions of Section 80-IB in the context whether subsequent amendment proposed to alter condition of Developer may cause a serious detriment in the process of construction and development activities. For example, if as per extent rules of local body, shops and commercial activities construction was permitted upto 10% and project was also sanctioned to Assessee allowing 10% area for commercial purposes, by applying amended provision which came into force on 01.04.2005, can it be said that Assessee has now to demolish extra coverage, meant for commercial purpose in order to bring its development activities within prescribed limits of new provision and to avail benefit under Section 80-IB(10), only because of the reason that project was not complete as on 01.04.2005. Court said that answer would have to be given in negative on the principle that planning as per law prevailing prior to 01.04.2005 has been observed and acted upon by Assessee. It has acquired vested right thereof which can not be taken away. Revenue authorities cannot be allowed to ask Assessee to do something which is almost impossible. Similar view was taken in another decision in Commissioner of Income Tax Vs. Veena Developers (2015 (5) TMI 193 - SUPREME COURT ). Thus, question (iv) answered against Revenue and in favour of Assessee. Deduction u/s 80IB (10) (a) - Held that:- Looking to objective and purpose of conditions of completion of project and the fact that it is not a provision which came for the first time altogether into existence on 01.04.2005, we are inclined to follow Madhya Pradesh High Court's judgment in The Commissioner of Income Tax, Bhopal Vs. M/s Global Reality (2015 (10) TMI 2384 - MADHYA PRADESH HIGH COURT ) and hold that Assessee in question was supposed to comply Section 80-IB(10)(a) as came to exist on amendment by Finance Act, 2004. - Decided in favour of revenue Judgments of earlier Assessment Years ought not have been followed blindly by Tribuna - Held that:= It is true that earlier judgment of Tribunal did not become final since Revenue preferred appeal in this Court but still applying rule of precedent in support of question of law, we follow the view already taken. We do not find any per se impropriety or lack of jurisdiction. Question, however, as to whether Assessee satisfied all conditions required for deduction under Section 80-IB(10) or not, has not been examined by Tribunal for the reason that it has proceeded with impression that entire amendment made by Finance Act, 2004 w.e.f. 01.04.2005 in Section 80-IB(10) would be prospective and, therefore, whether project of Assessee was complete or has obtained completion certificate and other relevant circumstances, we find, there is no discussion or finding recorded by Tribunal in all these appeals. Therefore, we leave aforesaid questions open at this stage, inasmuch in our view, it is appropriate that on these aspects, matter may be examined by Tribunal in the light of other questions answered above by this Court.
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