TMI Blog2012 (10) TMI 222X X X X Extracts X X X X X X X X Extracts X X X X ..... efit of deduction u/s. 80 IB (10) cannot be denied. Issue decides in favour of revenue - ITA Nos. 887, 888 & 889/PN/2010 - - - Dated:- 26-4-2012 - Shri Shailendra Kumar Yadav And Shri R.K. Panda JJ. Appellant by: Shri. Nikhil Pathak Department by: Ms. Ann Kapthuama ORDER Per R.K. Panda, AM ITA No. 887/PN/2010 and 888/PN/2010 filed by the revenue are directed against the common order dated 26.3.2010 of CIT(A) II, Pune relating to A.Y. 2003-04 and 2004-05 respectively. ITA No. 889/PN/2010 filed by the Revenue and ITA No. 838/PN/2010 filed by the assessee are cross appeals and are directed against the order dated 26th March 2010 of the CIT(A) II, Pune relating to A.Y. 2005-06. Since common issues are involved in all these appeals, therefore, these were heard together and are being disposed of by this common order. ITA No. 888/PN/2010 (A.Y. 2004-05) 2. The grounds raised by the revenue are as under : 01. The order of the learned CIT(A) is contrary to law and to the facts and circumstances of the case. 02. On the facts and in the circumstances of the case and in law, the learned CIT(A) grossly erred in allowing the deduction u/s 80IB(10) of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in 80 IB (10)(c ) was violated. The A.O. further observed that the adjacent units were combined by assessee itself and not by the purchasers at a later stage since the part completion certificate issued by PMC showed the units as joint. Further, the lay out plan approved by the PMC also showed that there is no dividing walls between these adjacent flats i.e. at the layout stage itself these were proposed to be combined. He, therefore, rejected the claim of deduction u/s. 80 IB (10) of the I.T. Act since the assessee has violated the conditions given in clause (c) of 80 IB (10). 4. Before CIT(A), the assessee made detailed submissions and relied on various case laws. It was submitted that there are certain factual errors in the assessment order. It was submitted that in Building A none of the flats were combined. Only in Building B some of the flats were combined and were sold to the same individual or family members. After accepting the additional evidences filed by the assessee and after considering the report /comments of the AO the Ld CIT(A) allowed the claim of deduction 80- IB(1) by holding as under : 3.7 I have considered the submission of the appellant and material avai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... examined and commented upon by the Assessing Officer in accordance with Rule 46A of I.T. Rules. In the report dated 27.5.2009, the Assessing Officer has objected to the admission of the additional evidence being Architect s Certificate regarding the measurement of the flats; and has also attached Xerox copies of the building plans for flat Nos. 501 502 of building B as well as the corresponding copy of the brochure in which breakup of the saleable area has been given. 3.9 The appellant s comments on the Assessing Officer s report objecting to the additional evidence dtd. 26.3.2010 have been reproduced above. Further, in this letter, it has been further elaborated and explained as to how this computation of built-up area given by the Architect was to be taken into account otherwise by the layout plan itself it was simple to calculate. It was contended by the appellant that the additional evidence being the Architect s Certificate giving the flatwise measurements of Built-up areas for the two buildings was such that even on the basis of floor plan submitted before the Assessing Officer in the assessment proceedings and also enclosed by the Assessing Officer in the remand report ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 502 is 781 sq.ft. each and the total built up area after combining the two flats exceeds 1500 sq.ft. In that context, the assessee has submitted that the certificate. The learned A.O has stated that the said area of 781 sq.ft. is as per the brochure of the assessee. Thus, according to him, the built up area of the two flats after combining is more than 1500 sq.ft. 6] In this context, the assessee submits that the contention of the learned A.O. is not correct. No doubt, in the brochure of the assessee, the built up area specified is 781 sq.ft. and the terrace area 75 sq.ft. and the total salable area is 819 sq.ft. The copy of the brochure is enclosed by the learned A.O. in his remand report. It may be noted that in Pune, the builders have a system of super built up area i.e. basic built up area which is further increased on account of proportionate amenity areas by around 10 15%. Thus, the area after increasing by 10 15% is known as super built up area and that is considered as the saleable area. Now, in the brochure of the assessee, the built up area is shown as 781 sq.ft. and after including the terrace, the saleable area is arrived at 819 sq.ft. Thus, this fact itself ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined area of the flats for this building. So far as building B is concerned, it is admitted by the appellant that the some of the flats were combined but in respect of most of them, when the terrace area was excluded, the combined area was less than 1500 sq.ft. It is only in respect of flat No. 501 and 502 that the Assessing Officer has pointed out that the built-up areas itself was 781 sq.ft. each, and even if the terrace was excluded, the area of the combine becomes 1562 sq.mtrs. However, the appellant has explained along with the calculation according to which the actual built-up area was only 700 sq.ft., and the area mentioned in brochure at 781 sq.ft. was actually the super builtup area and not the basic built-up area. This is also corroborated by the Architect s Certificate. It has been explained by the appellant that in the brochure, the built-up area is shown at 781 sq.ft. and terrace at 75 sq.ft., and after combining the same (50% of terrace area) the total saleable area arrived at is 819 sq.ft. Thus, the facgt that the addition of built-up area and 50% of terrace area gives the resultant area shown under saleable area , it implies that the built-up area shown in the broc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions cited before us. The only dispute in the grounds raised by the Revenue is regarding allowability of deduction u/s. 80 IB (10) since the total area of certain flats which were combined together exceed the maximum limit of 1500 sq.ft.. It is the submission of the Ld. Counsel of the assessee that even if 2 flats are combined together, total built up area of none of the flats exceeds 1500 sq.ft. if balcony/terrace are excluded. We find the A.Y. involved in the impugned appeal is A.Y. 2004-05 and the project has been approved prior to 1st April 2005. Therefore, in view of the decision of Mumbai Bench of the Tribunal in the case of Haware Constructions (P) Ltd. (Supra), the provisions of Subsection 14(a) of Section 80 IB which defines built up area to include projections and balconies are applicable only in respect of the projects approved after 1st April 2005 and consequently, balcony/terrace cannot be included in the built up area of the flats in the assessee s housing project which was admittedly approved prior to 1st April 2005. Since after excluding the projections and balconies, none of the combined flat exceeds the built up area of 1500 sq.ft., a fact brought on record by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the action of the A.O in disallowing the claim of deduction made u/s. 80 IB (10) amounting to Rs. 1,13,290/-, therefore, there cannot be any grievance by the revenue. Accordingly, the grounds raised by the revenue being infructuous are dismissed. 10. So far as the grounds raised by the assessee are concerned, they relate to denial of benefit of deduction u/s. 80 IB (10) of the Act. According to the Ld CIT(A), the amended provisions of Sec. 80IB (14)(a) which are inserted by the Finance (No.2) Act 2004 were applicable w.e.f. A.Y. 2005-06. It is the contention of the Ld Counsel for the assessee that in view of the decision of the Co-ordinate Bench of the Tribunal in the case of D.S. Kulkarni Associates, vide ITA No. 17/PN/2009, order dated 31st May 2011 for the A.Y. 2005-06 and the decision of the Bombay Bench of the Tribunal in the case of Haware Constructions (P) Ltd. (Supra), the definition of built up area as given in Sub-Section 14(a) of Sec. 80 IB as inserted by the Finance No. 2 Act 2004 is inserted w.e.f. 1.4.2005 and therefore, the same is applicable only in respect of the projects approved after 1st April 2005. When the assessee submits the proposal for carrying out ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No.2 of the assessment order and page no. 41 of the paper book in the case of D.S. Kulkarni and Associates, the project was commenced on 12.4.2001 and completed in the month of November 2003. Thus, the assessees were supposed to complete the projects as per the law as existed in the A.Y. 2001-02 in the case of Opel Shelters and in the A.Y. 2002-03 in the case of D.S. Kulkarni and Associates. We thus following the decision in the case of Hiranandani Akruti JV V/s. DCIT (Supra) hold that amended provisions under Section 80 IB(10) w.e.f. 1.4.2005 are not applicable in the present case, hence assessees are eligible for the claimed deduction u/s. 80 IB (10) of the Act. We accordingly direct the A.O to allow the claimed deduction to the assessees. 12. We find similar view has been taken by the Mumbai Bench of the Tribunal in the case of Haware Constructions (P) Ltd. (Supra). Since the projects has been approved prior to 1.4.2004 and since after excluding the balcony/terrace, the total built up area of none of the flats exceeds 1500 sq. ft., therefore, respectfully following the decisions cited (Supra) we hold that the benefit of deduction u/s. 80 IB (10) cannot be denied to the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
