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TMI Blog2013 (12) TMI 1570X X X X Extracts X X X X X X X X Extracts X X X X ..... herefore, following the decision of the Hon'ble Supreme Court in the case of National Thermal Power Co. Ltd. Vs. CIT, 229 ITR 283 admit the additional ground. 4. The facts which are revealed from the record as under. The assessee is a partnership firm engaged in the business of builder and developer. The assessee has undertaken a housing project from which the assessee declared the net profit of Rs. 1,16,18,359/- and the entire profit was claimed as deduction u/s. 80IB(10) of the Income-tax Act. The Assessing Officer raised certain queries on the deduction claimed by the assessee. The assessee stated that the building plans of the said housing projects were sanctioned on 14-06-2004 and 27-04-2005. The assessee's housing project was consisting of 42 residential units, being 18 row house and 24 flats. As stated by the assessee the units/flats were complying with the maximum permissible limit of the built up area i.e. 1500 sq. ft. As observed by the Assessing Officer, the total area of the plot on which the housing project was undertaken, as per the layout plan was to the extent of 4100 sq. mtrs. and net gross plot area 4100 sq. mtrs. The Assessing Officer has also noted that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the housing project has been executed is not acceptable. It is true that it is a mandatory condition for the assessee to reserve 15% of area as amenity space. However assessee is not compelled to construct buildings of commercial nature in the amenity space by any order of any Authority. The assessee by its own free will has ventured into the activity of constructing buildings such as bakery, consumer store, books stall, market, hospital, library, exhibition hall dispensary yoga centre training institute etc., which are patently of commercial nature. The assessee by venturing into taking such decision has risked its claim for deduction u/s 80IB (10). The assessee could have very well kept the space open and vacant as required by the office of Collector in order to fulfill the conditions prescribed in the provision of sec.80IB(10) and protect its claim u/s 80IB(10). Thus assessee's plea that it has constructed commercial buildings out of compulsion is incorrect and could not come to its rescue. 3.3. The assessee's claim that it has separate sanction for constructing buildings in amenity space is also not correct. The said sanction dated 7.6.2008 is a revised sanction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made before the Assessing Officer including the citing of various tribunal decisions in the case of Vandana Properties, Saroj Sales Corporation, Subhash Bafna, etc. One CBDT letter dated 4.5.2001 was cited, in which it was stated that an additional housing project on existing housing project can also quality u/s. 80IB(10). Moreover, a recent decision of Pune Tribunal in the case of Apoorva Properties and Estates in ITA No. 1550/PN/2008 dated 21.8.2009 for A.Y. 2005-06 was also cited. The appellant has also placed reliance on certain paras of Pune special bench decision in the case of Brahma Associates and others, 22 DTR 1. It is noticed that this decision of Brahma Associates was in a different context than that of the appellant. Firstly, it related to A.Y.2003-04 and the question whether during the period prior to amendment w.e.f. A.Y. 05-06, when clause (d) was inserted in the section 80iB(10), these provisions would apply. It was held by the Special bench of the tribunal that in the years prior to the amendment, upto 10% of commercial area could be allowed in a housing project, and still it was eligible u/s.80IB(10). Here it is not such a case, since the assessment year involve ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee is in appeal before us. 8. We have heard the rival submissions of the parties and perused the record. The main plank of the argument of the Ld. Counsel is that the amenities space cannot be equated with commercial space and even if assuming it is a commercial space but still as the assessee's project is sanctioned prior to 01-04-2005, the limitation put on the maximum commercial area in any housing project is not applicable to the assessee's project as the original lay out and buildings plan were first sanctioned on 14-06-2004. He submits that amenities building which is said to be commercial is an independent building and is built up on specific marked area of 1230 sq. mtrs. which is an independent plot carved out of the total area of 8200 sq. mtrs. He submits that initially the project was on the plot of land of 4300 sq. mtrs. but subsequently adjoining plot was acquired and hence, the separate demarcation was made. He relied on the decision of the Hon'ble High Court of Gujarat in the case of Manan Corporation Vs. CIT 78 DTR 205 (Guj) and CIT Vs. Brahma Associates 333 ITR 289 (Bom). He submits that assuming without going into controversy whether it is a single pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Till 01-04-2005 the assessee has not done anything on the plot. It appears that the assessee acquired the adjoining land and filed the further revised plan and layout for the approval to the local authority and the approval was given to the said plan on 05-08-2006. In the said layout the total area of the plot is shown at 8400 Sq. ft. (copy of the plan and layout is at Page Nos. 28 and 30 of Compilation). From this factual aspect, it can safely be concluded that in fact the plan sanctioned on 05-08-2006 is almost a new plan and it was not merely the revision of the existing plan, even though in the application to the local authority the assessee has stated revision of the plan and layout. In consequence of acquisition of the additional land, the area of the amenities space was also increased so it cannot be said that the plan sanctioned on 05-08-2006 is only the revised plan. We are unable to accept the argument of the Ld. Counsel that as the project was sanctioned on 16-06-2004, hence the definition of the built up area introduced in Sec. 80IB(10) by the Finance (No. 2) Act, 2004 w.e.f. 01- 04-2005 is not applicable. After anxiously perusing the documents on record, including the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n it partake the character of independent project and cannot be tagged with the assessee's other projects. The Ld. Counsel also submitted that not a single unit in the said building has been sold till today even though given on lease and no profit from the amenity building space is included in the eligible profit on which the deduction u/s. 80IB(10) has been claimed. The Ld. Counsel has relied on the plethora of the decisions on this limb of argument but in our opinion the decision of the Hon'ble jurisdictional High Court in the case of CIT Vs. Vandana Property 353 ITR 36 (Bom) is applicable to the facts of this case. We, accordingly, hold that the amenity building is an independent project itself and it cannot be tagged with other projects of the assessee. We, further hold that the assessee has not violated any of the conditions of Sec. 80IB(10) to gain eligibility for claiming the deduction and hence both the authorities below erred by denying the deduction to the assessee. We, accordingly, allow the assessee's claim of deduction on the above reason and direct the Assessing Officer to allow the deduction u/s. 80IB(10). We also make it clear that as the amenity building is tre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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