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2019 (1) TMI 673 - AT - Income TaxDeduction u/s 80-IB(10) - residential township with commercial area - integrated township - combination of two projects - size of flats exceeding prescribed limit of 1500 sq. ft. - allotment of more than one residential unit to an individual - Held that:- Poorvi” and “Triveni” have to be considered as separate housing projects for the purpose of the grant of deduction u/s 80-IB(10) of the Act. CIT(A) as well as the Assessing Officer were not justified in denying the deduction u/s 80-IB(10) of the Act, on the ground that the housing projects are part of a larger infrastructural and township projects and when the entire township project is taken together, the conditions laid down u/s 80-IB(1)(d) of the Act are violated. This is not correct. When the housing projects “Poorvi” and “Triveni” are taken separately, there is no finding by the revenue that the condition specified u/s 80-IB(10)(d) of the Act are violated. Hence we decide this issue in favour of the assessee. Project where deduction u/s 80-IB(10) is claimed, no separate signed profit and loss account was furnished - Held that:- Deduction u/s 80-IB(10) of the Act, cannot be disallowed on the ground that separate books of account were not maintained by the assessee and on the ground that signed profit and loss accounts, project-wise, were not submitted. This issue is decided in favour of the assessee. Under the scheme of the Act, no more than one residential unit can be allotted any individual and the assessee had not filed the details in this regard - Held that:- as per the details filed by the assessee it is clear that out of both the projects only 8 flats were sold to persons who were relatives. This fact is not disputed by the Assessing Officer or the ld. D/R before us. Under these circumstances the question is whether deduction can be denied for the profits earned on entire housing projects or it can be denied proportionately. As decided in case of Viswas Promoters Pvt. Ltd [2012 (11) TMI 1117 - MADRAS HIGH COURT] principle of proportionate disallowance was approved. No contrary judgment is brought to our notice. Hence we hold that the Assessing Officer could at best disallowed at 1.9% of the claim made by the assessee u/s 80-IB(10) of the Act, as out of the total of 224 flats of Poorvi and 234 flats of Triveni, only 8 flats were sold to the same individual or their relatives. The Assessing Officer is directed accordingly. Also find force in the arguments of the assessee that the deduction cannot be denied on the same facts for a particular Assessment Year, when similar deduction was granted u/s 80-IB(10) of the Act for the earlier Assessment Years. The basis on which deduction was granted in the earlier years could not have been disturbed in the subsequent years as the principle of consistency applies and the revenue has to brought out any new facts on record. In view of the above discussion, we direct the Assessing Officer to restrict the disallowance to 1.9% of the claim made by the assessee u/s 80-IB(10) of the Act. Disallowance u/s 40(a)(ia) - CIT(A) held that ADDA was not registered u/s 12A of the Act and hence was not entitled to the benefits of Section 11. The assessee has produced before us the registration granted to ADDA u/s 12A - This fact was not before the ld. CIT(A) - we set aside this issue to the file of the Assessing Officer for considering the issue afresh, in accordance with law, in view of the second proviso to Section 40(a)(ia)
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