TMI Blog2016 (4) TMI 121X X X X Extracts X X X X X X X X Extracts X X X X ..... M/s. Rohan Engineering Construction (supra) are identical to the facts before us, where the assessee was not able to obtain the completion certificate by the appointed date and the deduction under section 80IB(10) of the Act was denied and it was held by the Tribunal that the assessee is not liable for levy of penalty under section 271(1)(c) of the Act. Following the same parity of reasoning, we reverse the order of CIT(A) and direct the Assessing Officer to delete penalty under section 271(1)(c) - Decided in favour of assessee - ITA Nos.420 to 422/PN/2014 - - - Dated:- 17-2-2016 - MS. SUSHMA CHOWLA, JM AND SHRI PRADIP KUMAR KEDIA, AM For The Appellant : Shri Nilesh Khandelwal For The Respondent : Shri Mahesh D. Akhade ORDER PER SUSHMA CHOWLA, JM: These three appeals filed by the assessee are against consolidated order of CIT(A)-I, Pune dated 31.12.2013 relating to assessment years 2005-06 to 2007-08 against penalty levied under section 271(1)(c) of the Income-tax Act, 1961 (in short the Act ). 2. This bunch of present appeals relating to the same assessee were heard together and are being disposed of by this consolidated order as the issue raised i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... received the completion certificate till date and hence, the claim of deduction under section 80IB(10) of the Act was found to be incorrect. Another observation by the Assessing Officer was that if the date of commencement of assessee s project was taken to be 27.03.2003, then the project was to be completed on or before 31.03.2008, so the assessee was show caused as to why the claim made under section 80IB(10) of the Act should not be disallowed. In reply, the assessee submitted that it had applied for completion certificate within stipulated period i.e. on 29.03.2008. While applying for the same, No Objection Certificates from various departments like drainage NOC, Road NOC and Fire NOC were also enclosed, but till date the completion certificate has not been issued. The Assessing Officer was of the view that where the completion certificate had not been issued, the project could not be said to be completed as on 31.03.2008. The Assessing Officer thus, held that the assessee was not eligible for claim of deduction under section 80IB(10) of the Act, hence, the deduction claimed under section 80IB(10) of the Act at ₹ 4,13,286/- was disallowed. Consequently, penalty proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there is no merit in levy of penalty under section 271(1)(c) of the Act. Reliance was placed on the following decisions:- a. CIT Vs. Reliance Petro Products Pvt. Ltd., reported in 322 ITR 158 (SC) b. Hindustan Steel Vs. State of Orissa reported in 83 ITR 26 c. ACIT Vs. M/s. Rohan Engineering Construction in ITA No.867/PN/2011, relating to assessment year 2006-07 order dated 19.10.2012 6. The CIT(A) observed that it was not in dispute that the assessee had not received the completion certificate from the local authority on or before 31.03.2008 as required under clause (ii) of Explanation read with sub-section (i) of clause (a) of section 80IB(10) of the Act. The CIT(A) noted that the amendment was brought in Statute under Finance (No.2) Act, 2004 effective from 01.04.2005 and though the commencement certificate was obtained on 27.03.2003 when there was no requirement to furnish the completion certificate, but because of the amendment, the said completion certificate had to be filed on or before 31.03.2008. In view of the amendment being brought in w.e.f. 01.04.2005, the CIT(A) held that there was no merit in levy of penalty for assessment year 2004-05 as the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulfilled all the conditions laid down therein. Our attention was drawn to the audit report filed for the respective years in Form No.10CCB and it was pointed out that in the said audit report, the date of completion of housing project was shown as under construction. He further pointed out that the size of the plot was 6991.51 sq. mtrs. and the built up area of each of the residential unit of the project was about 510 sq. ft. Similar declaration was made in Form No.10CCB in all the respective assessment years under appeal. Thereafter, the assessee on 29.03.2008 filed an application for issue of completion certificate, which fact has been noted by the Assessing Officer during the course of passing assessment order. However, in view of non-clarity on the issue of claim of deduction under section 80IB(10) of the Act, the assessee accepted the disallowance made by the Assessing Officer and paid taxes due thereon. It was pointed out by the learned Authorized Representative for the assessee that in the circumstances, where all the factual material was available before the Assessing Officer and in view of catena of judgments in allowing the claim of deduction under section 80IB(10) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... concealed the particulars of income or furnished inaccurate particulars of income. Before levying penalty under the said sub-section, first finding has to be against the assessee that it had concealed its income or had furnished inaccurate particulars of income. One limb of section 271(1)(c) of the Act is to be fulfilled before the assessee can be held to be liable for levy of penalty under section 271(1)(c) of the Act. 11. In the facts of the present case, the assessee had commenced housing project on 27.03.2003 and under the then provisions of section 80IB(10) of the Act, there was no requirement to complete the project within a time frame. The assessee thereafter, for the years ending 31.03.2004 to 31.03.2007 had claimed the said deduction under section 80IB(10) of the Act on such portion of buildings which were completed by it from year to year. Admittedly, the buildings were under construction for all these years. In the original return of income filed for assessment years 2004- 05 to 2007-08, the assessee had claimed the deduction under section 80IB(10) of the Act. The Finance (No.2) Act, 2004 had inserted a condition for obtaining completion certificate. This amendment c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act on completed portion of building from year to year, if the assessee fulfills the requirement of completing the building by stipulated date i.e. 31.03.2008. Admittedly, in the facts of the present case, the assessee had completed the building before 31.03.2008 and even applied for completion certificate on 29.03.2008 after receiving the requisite No Objection Certificates from various departments and also the completion certificate issued by the Architect. In the above said facts and circumstances, where the assessee has furnished complete details in respect of its claim of deduction under section 80IB(10) of the Act and merely because the same was denied to the assessee on some premise, which does not hold good in today s scenario of settled position of law. We further find that similar view has been taken by Pune Bench of Tribunal in M/s. Aum Housing Vs. ITO in ITA No.44/PN/2013, relating to assessment year 2009 -10, order dated 06.02.2015. We find no merit in the order levying penalty under section 271(1)(c) of the Act in this regard. We find support from the ratio laid down by Pune Bench of Tribunal in ACIT Vs. M/s. Rohan Engineering Construction (supra) and ITO Vs. Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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