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The ITO-19 (1) (4) , Mumbai Versus M/s. Sagar Shopping Developers and Vica-Versa

2016 (3) TMI 210 - ITAT MUMBAI

Denial of deduction u/s. 80IB(10) by reopening the assessment u/s. 147 - Held that:- The commencement certificate issued on 13.11.1996 in the name of Sunil Builders got expired on 12.11.1997 and the assessee on entering into development agreement with Sunil Builders applied for commencement certificate on 13.5.1999 and got certificate dated 5.8.1999 and the project was commenced by the assessee pursuant to the certificate dated 5.8.1999 and since the project was commenced after 1.10.1998, assess .....

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3-04. Since this appeal and the cross objection were heard together, they are disposed of by this common order for the sake of convenience and brevity. 2. The Revenue has raised the following grounds of appeal: 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) has erred in treating that the project had commenced after 1.10.1998 without appreciating the fact that the AO had brought out sufficient material on record to conclude that the project had commenced much prio .....

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assessee on 1.11.2004 declaring Nil income after claiming deduction u/s. 80IB(10) of the Act . Assessment u/s. 143(3) was completed on 28.3.2006 accepting the Nil income shown by the assessee after allowing deduction claimed u/s. 80IB(10) of the Act. Later on notice u/s. 148 was issued and the reassessment was completed u/s. 143(3) r.w. Sec. 147 of the Act completed on 24.12.2007 determining the income of the assessee at ₹ 29,36,955/- by withdrawing the deduction allowed u/s. 80IB(10) of t .....

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ter 1.10.1998 and since the commencement certificate has been issued on 13.11.1996 i.e. prior to 1.10.1998, the AO was of the view that the assessee is not entitled for deduction u/s. 80IB(10) of the Act. 3.1. On appeal, the Ld. CIT(A) while upholding the validity of reopening allowed the claim of deduction u/s. 80IB(10) to the assessee holding that the commencement certificate which was issued on 13.11.1996 in the name of Sunil Builders got expired on 12.11.1997 and the assessee applied for com .....

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the Act. 4. Aggrieved by this, the Revenue is in appeal before us. 5. The Ld. Departmental Representative vehemently supported the order of the AO in denying the assessee deduction u/s. 80IB(10) of the Act. 6. The Ld. Counsel for the assessee strongly supported the order of the Ld. CIT(A). He invited our attention to page 53 to 55 of the Paper Book and submits that the original commencement certificate was issued in the name of Sunil Builders on 13.11.1996 and this was valid upto 12.11.1997. He .....

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of the project was commenced in pursuance of the said certificate. Therefore, it is submitted that the project was commenced after 1.10.1998 and the assessee is entitled for deduction u/s. 80IB(10) of the Act. 7. Heard the rival contentions, perused the materials placed before us. The AO denied deduction u/s. 80IB(10) by reopening the assessment u/s. 147 of the Act for the reason that deduction u/s. 80IB(10) is allowable when the project is commenced on or after 1.10.1998. Since the commencemen .....

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dated 5.8.1999 and since the project was commenced after 1.10.1998, assessee is entitled for deduction u/s. 80IB(10) of the Act. While holding so, the Ld. CIT(A) observed as under: The appellant on the other hand has contended that the commencement certificate (CC) dated 13.11.1996 issued in the name of Sunil Builders got expired on 12.11.1997 since Sunil Builders did not carry any development work. The appellant made an application to BMC on 13.5.1999 and accordingly the appellant was issued co .....

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ment activity has commenced. The AR. of the appellant also submitted that in subsequent years, the assessment has been framed u/s.143(3) and that findings have been given that the appellant has satisfied all the conditions u/s.80IB(1) of the I.T.Act. The CC dated 13.11.1996 was issued in the name of Sunil Builders which got expired on 12.11.1997. However, the CC dated 13.11.1996 was issued in the name of Sunil Builders who did not carry out any development work. This being so, the appellant made .....

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