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2016 (4) TMI 421 - ITAT MUMBAI

2016 (4) TMI 421 - ITAT MUMBAI - TMI - Disallowance u/s 801B(10) - Held that:- The statement given by one of the partners stating during survey proceedings that there is wrong claim made u/s. 80IB of the Act and offering the same for taxation has no evidentiary value unless there is corroborative evidence on record suggesting that the claim of the assessee is wrong. In the absence of any evidence on record, these statements cannot be a conclusive piece of evidence for withdrawing the deduction. .....

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oment when he visited the builders office for personal work. The statement was given under tension on account of office related work. By letter dated 23.12.2007, Shri Abhiram Bhattacharjee alongwith his wife Sucharita Bhattacharjee and Shri Ajit Bhattacharjee have stated that they have purchased three different residential flats bearing flat Nos. 1407, 1408 & 1409 from the assessee in the year 2007. The flat was purchased in the joined names. It was stated that three flats were purchased by sepa .....

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n 1000 Sq. ft, there is nothing on record to suggest that assessee has sold flats with built-up area of more than 1000 Sq. ft. Mr.Abhiram Bhattacharjee himself later on said that the flats were purchased by separate sale deeds and subsequently they have joined the flats on their own at their own cost. There is no evidence on record to suggest that the builder has constructed the residential unit with a built-up area of more than 1000 Sq. ft. in violation of the master plan and sold to the purcha .....

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the Act both in respect of Bldg. No. 23 & 24 of Samartha Angan and Samartha Krupa. - Decided in favour of assessee. - I.TA Nos.5477 to 5482/Mum/2012 - Dated:- 9-3-2016 - SHRI C.N. PRASAD, JUDICIAL MEMBER AND SHRI RAJESH KUMAR, ACCOUNTANT MEMBER For The Appellant by: Shri Manjunatha Swamy For The Respondent : Shri Vinayak R. Velhankar ORDER PER C.N. PRASAD, JM: All these appeals are filed by the Revenue against the orders of the Ld. CIT(A) pertaining to assessment years 2004-05 to 2009-10. . As c .....

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Bhattacharjee , one of the purchasers of the flats, who during survey u/s 133A admitted purchase of a flat measuring more than 1000 Sq.Ft. as a single unit ignoring the fact that the retraction statement of Shri Abhiram Bhattacharjee was not brought to the notice of the Assessing Officer and Addl.CIT during the course of assessment proceedings, thus admitting additional evidence in violation of Rule 46A of the Income Tax Rules. " (ii) "On the facts and in the circumstances of the case .....

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ntending that the Ld. CIT(A) ought not to have admitted additional evidence/retractions statements without complying with the procedure laid down in Rule 46A. 4. The Ld. Departmental Representative submits that in the course of survey, one of the partners gave statement offering income of ₹ 150 crores for the reason that they made a wrong claim of deduction u/s. 80IB(10) of the Act and this statement was later retracted and such retraction was entertained by the Ld. CIT(A) in violation of .....

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d 2.4.2011 was furnished to the ACIT, Central Circle-7 retracting the statement made on 30.3.2011 withdrawing the offer of ₹ 150 crores to be taxed. The Ld. Counsel submits that the retracted statement of the partner is part of assessment records and it cannot be considered as additional evidence at all. The Ld. Counsel further referring to page-24 & 25 of the paper book submits that the purchaser of the flats who earlier stated that the flats purchased by them are more than 1000 Sq. f .....

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was filed before the ACIT on 21.11.2011. Therefore the Ld. Counsel for the assessee submits that all these statements given by the partner as well as the buyers retracting their earlier statements since form part of the survey proceedings or assessment proceedings, they cannot be considered as additional evidence and therefore the additional ground filed by the Revenue is untenable and liable to be dismissed. 6. We have heard both parties. In so far as the additional ground raised by the Revenue .....

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the Revenue in all these appeals do not emanate from the order of the Ld. CIT(A) and therefore they are dismissed. 7. Coming to the regular grounds of appeal i.e. deletion of disallowance of deduction u/s. 80IB(10) of the Act, the brief facts are that the assessee is a partnership firm engaged in the business of Civil construction/developers and builders. The assessee filed its return of income for all these assessment years i.e. 2004-05 to 2009- 10 claiming deduction u/s. 80IB(10) of the Act. .....

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xcess claim of deduction u/s. 80IB(10) of the Act in the assessment years 2004-05 to 2009-10. Pursuant to the survey conducted on 30.3.2011, the AO issued notice dated 31.3.2011 u/s. 148 for all these assessment years and reopened the assessments. In response to the notice issued u/s. 148 of the Act the assessee filed a letter dated 4.4.2011 alongwith an affidavit of Shri Vikas Walawalkar dated 2.4.2011 retracting offer of tax of ₹ 150 crores which was earlier declared by him in his statem .....

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ted Inspector for spot verification and enquiry. The Inspector after the enquiry submitted his report stating that as per sale deed, the area of each flat sold was less than 1000 Sq. ft but the total area of most of the flats exceeded 1000 sq.ft due to changes done by the flat owners by converting common passage area, flower bed etc., into premises, thus the flat area exceeded 1000 Sq. ft. In view of the Inspector s report and also since the assessee retracted from the declaration recorded u/s. .....

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e of Samartha Angan Building No. 23 & 24. He further held that assessee is not entitled for deduction u/s. 80IB(10) in respect of the building Samartha Krupa for all these assessment years for the reason that as per the sale deed the area of plot mentioned is less than one acre and therefore assessee is not entitled for deduction u/s. 80IB(10) of the Act. He further directed the AO to allow the claim of the assessee u/s. 80IB(10) for the buildings Samartha Angan No. 21 and Samartha Angan No. .....

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per the direction u/s. 144A 2004-05 23,67,82,614/- 2,37,35,754/- 2005-06 33,43,52,139/- 3,44,07,056/- 2006-07 52,94,49,427/- 10,78,39,415/- 2007-08 43,69,71,550/- 22,78,72,832/- 2008-09 39,60,40,233/- 32,40,52,511/- 20098-10 41,32,69,580/- 5,72,22,499/- Total 2,34,68,65,543/- 77,51,30,067/- 10. The Ld. Departmental Representative vehemently submits that on the date of survey one of the partners Shri Vikas Walawalkar admitted that there is excess claim for deduction u/s. 80IB(10) of the Act and .....

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he deduction claimed earlier as it was a wrong claim and such claim was worked out at ₹ 148,76,32,704/-. Therefore, the Ld. DR submits that assessee offered a round figure of ₹ 150 crores for taxation in its statement recorded in the course of survey on 30.3.2011. The Ld. DR submits that having stated that the claim was wrongly made by the assessee u/s. 80IB(10) of the Act in respect of the flats more than threshold limit exceeded 1000 Sq. ft which is against the provisions of Sec. 8 .....

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tacharjee who stated that he had purchased three flats Nos.1407, 1408 & 1409 from the assessee in Samarth Angan Building No. 24 and the flat purchased was single flat exceeding 1000 Sq. ft of area. Therefore, the Ld. DR submits that since the assessee sold 2 or 3 flats as a single unit to one person, it exceeded 1000 Sq. ft, the assessee is not entitled for deduction u/s. 80IB(10) of the Act. 12. The Ld. Sr. Counsel for the assessee Shri Vinayak R. Velhankar submits that there was a survey i .....

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u/s. 80IB(10) of the Act. The Ld. Counsel for the assessee submits that the statement was given by the partner on the advice of his Counsel and the Counsel is not aware of the facts and was under the impression that the assessee had sold one single residential unit by executing three separate sale deeds and also since the flats have been joined by the purchaser was not entitled for claim for deduction u/s. 80IB(10) of the Act. The Ld. Counsel submits that when the mistake was explained, assessee .....

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uld not be relied upon. The Ld. Counsel for the assessee submits that the statement was given by the partner of the firm without verifying the facts from the records. The Ld. Counsel for the assessee submits that retraction from admission is permissible in law. For this proposition he placed reliance on the following decisions: 1) Pullangode Rubber Produce Co. Ltd Vs State of Kerala (91 ITR 18)(SC) 2. Pangamban Kalanjoy Singh Vs State of Manipur- AIR (1956) (SC) 09 13. The Ld. Counsel further re .....

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he statement retracted by the partner of the assessee firm and allowed the claim u/s. 80IB(10) of the Act in respect of the above buildings i.e. Samarth Angain Bldg. No. 21 & 22 and Meghadoot A & B Wing and Samartha Deep-11, he submits that there is no justification in disallowing the claim in respect of Bldg. No. 23 & 24 of Samartha Angan. The Ld. Counsel submits that the claim was disallowed solely on the basis of the statement recorded from one Mr. Abhiram Bhattacharjee who later .....

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He submits that Samarth Krupa is integral part of the project sanctioned by the local authorities having plot area of more than one acre and therefore there is no justification in holding that the area of the plot is less than one acre and disallowing the claim u/s. 80IB(10) of the Act. 15. The Ld. Counsel for the assessee further submitted as under: Partner of the firm made factually incorrect statement as is evident from the plans submitted and the agreements made. This is not a case where or .....

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paid the required advance amount, many buyers suggest modifications at their own cost to suit their own purpose. This cannot be considered as violation of the conditions. Thus as per plans what was constructed and sold was single residential unit having Built up area below 1,000 sq. ft. per residential unit. Even the occupation certificate was granted by BMC as per approved drawings wherein the built up area of each flat was less than 1000 sq.fts. (ii) Each entity sold as per registered sale dee .....

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e is available to establish that appellant has made sale of any extra space in addition to the flat, which has a built up area of 1000 sq.fts. B.U. area. (v) The above facts were confirmed by the Inspector IT in his report, which was furnished after visiting the site and after making necessary enquiries. (vi) Physical verification was not carried out during the course of survey. (vii) During the course of survey due to various psychological factors, pressure of the man power conducting the surve .....

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to the flat being sold at the time of sale and the flat should be a complete unit which can be used as a residential unit then only deduction is to be allowed. In the case of appellant all these conditions are fulfilled so if at all any changes have been made by the purchaser later on, then the deduction cannot be denied on this account . Enclosed please find copies of our various letters dated 18.08.2011, 12.09.2011, 29.09.2011 & 17.10.2011. Regarding Samartha Aangan the appellant has file .....

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Abhiram Bhattacharjee, the learned AO concluded that all the flats sold by the appellant in Samartha Angan Building No.23 & 24 are more than 1,000 sq.ft. and disallowed the entire claim u/s.80IB for these two buildings. Learned AO did not consider host of evidences filed on record such as approved plans by local authority, floor plans certified by Architect, sale deeds duly executed and registered, Audit Report u/s.80IB(10) and even the Enquiry Report of the Inspector who was specifically ap .....

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subsequently for their convenience and at their expenses have joint these flats so that they can be used as one single flat (Refer to Page No.7 of the Assessment Order). (c) Learned AO. has based the entire disallowance for Samartha Aangan Buildng No. 23 & 24 on the statement of Mr. Abhiram Bhattacharjee. In the submissions of the appellant the said statement is factually incorrect and appears to have been given on spur of a moment when he happened to visit appellants' office for some p .....

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statement is against provision of law and cannot survive. It will not be out of place to mention that Shri Abhiram Bhattacharjee purchased flat No.1407,1408 & 1409 in building No.23 vide agreements dated :27/03/2007 whereas flats in building No.24 were sold much earlier vide agreements executed on 26/12/2003 & 01/09/2005. Hence in our opinion the assessing officer has erred in disallowing 80IB claims in respect of building No.24, flats of which were sold much prior to Mr. Abhiram Bhattac .....

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were amalgamated by purchasers after purchase. Hence we submit that on the basis of statement of Shri Abhiram Bhattacharjee, 80IB exemption cannot be withdrawn for sale of flats of building No.23 effected after 27/03/2007. Learned A.O. has also disallowed claim u/s.80IB with reference to Samartha Krupa building holding that though each flat sold has built up area of less than 1,000 sq. ft., the claim is disallowed on the ground that the area of the plot is less than one acre. In this connection .....

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or to its unit or units to be separately registered as distinct societies. In pursuance of the said exemption order and proper management of the individual societies, the said area is subdivided and units of the said society have been separately registered to form individual societies and land is subsequently conveyed to such units, duly registered as cooperative Housing Societies. As such building known as 'Samartha Krupa' constructed on the said plot No.123 is not a separate project, .....

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ea of the site on which the housing project is constructed and not with reference to the demarcation of land done by the land development authority as per Circular No 5/205 dated is" July, 2005. We are enclosing herewith a note with respect to the land area mentioned in the sale deed which is as per the demarcation done by the BMC while actually the area of the land is well above the threshold limit of one acre. In the case of CIT 25 v Vandana Properties [2012] 19 taxmann.com 316 (Bom.) the .....

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was engaged in business of construction and development of housing projects On a plot admeasuring 2.36 acres, it constructed buildings A,B, C and D prior to 1101998 After taking permission of State Government in year 2002 for conversion, assessee constructed an additional building 'E' in vacant land It claimed deductions under section 80fB( 10) for said building Assessing Officer disallowed claim for deduction on grounds that approval for building 'E' was an extension of approval .....

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It was only in year 2001 when status of land was converted from 'surplus vacant land' into 'within ceiling limit land' by State Government that an additional building could be constructed on plot in question and, accordingly, building plan for construction of building 'E' was submitted and same was approved by local authority on 11102002 Further, nowhere in relevant that intimation of municipality, it was stated that building 'E' constituted extension of earlier h .....

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n disallowance of 80IB claim of Samartha Krupa for all the years. Your attention is drawn to a recent direct decision of Mumbai tribunal in the case of HAWARE CONSTRUCTIONS (P) LTD. VS. LT.O. reported in (2011) 64 DTR (Mumbai)(Trib) 251 where in it is held ' " Deduction under section 80·IB - Income from developing and building housing project - Built up area exceeding 1000 sq.ft. B.U. area Built- up area of each flat as approved by CIDCO is less than 1000 sq.ft. B.U. area as per .....

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elf contained residential unit and that there would be a complete habitable residential unit only if two or more flats are joined together. Therefore, merely because some of the purchasers have purchased more than one flat and combined the same, assessee's claim for deduction u/.s80-IB(10) cannot be disallowed- Further, the condition that not more than one residential unit in the housing project is allotted to one person not being an individual has been inserted by Finance (No.2) Act, 2009, .....

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es, perused the orders of the lower authorities and the material placed before us. There was a survey in the premises of assessee on 30.3.2011. On the date of survey one of the partners stated that there was a wrong claim of deduction u/s. 80IB(10) of the Act by the assessee for all these assessment years therefore offered ₹ 150 crores for taxation. This statement was retracted by the partner on 2.4.2011 stating that the claim made by the assessee firm u/s. 80IB(10) of the Act is in accord .....

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ere sold as per registered agreements. Thus, the partner of the firm retracted his earlier statement stating that there is no wrong claim u/s. 80IB(10) of the Act. However, the AO completed the assessment based on the directions of the Addl CIT u/s. 144A by withdrawing the claim u/s. 80IB(10) for all these assessment years in respect of the Building No. 23 & 24 of Samartha Angan and in respect of the Building Samartha Krupa. The AO allowed deduction in respect of the Bldg. No. 21 & 22 of .....

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e of the buyer of the flat recorded during the course of survey proceedings . These persons retracted their statements later. The Madras High Court in the case of CIT Vs S. Khader Khan Son (300 ITR 157) considered the evidentiary value of the statements recorded during survey proceedings and held as under: 6. In the instant case, there was a survey operation conducted under s. 133A of the Act in the assessee's premises and a statement was recorded from one of the partners. Assuming there wer .....

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not be said solely on the basis of the statement given by one of the partners of the assesseefirm that the disclosed income was assessable as lawful income of the assessee . Since there was no material on record to prove the existence of such disclosed income or earning of such income in the hands of the assessee, it could not be said that the Revenue had lost lawful tax payable by the assessee. 7. In the decision in Pullangode Rubber Produce Co. Ltd. Vs.. State of Kerala 1972 CTR (SC) 253 : (1 .....

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e assessee retracted the additional income offered and contended that the statement was the result of duress, which was not accepted by the AO and also by the Tribunal holding that the statement is valid and that it was made without duress, a Division Bench of the Allahabad High Court in Dr. S.C. Gupta Vs.. CIT (2001) 170 CTR (All) 421 : (2001) 248 ITR 782 (All), of course, placing reliance on the decision of the apex Court in Pullangode Rubber Produce Co. Ltd. Vs.. State of Kerala held that the .....

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ecessary to confer such power to examine a person on oath, has expressly provided for it, whereas s. 133A does not empower any ITO to examine any person on oath. Thus, in contradistinction to the power under s. 133A, s. 132(4) of the IT Act enables the authorised officer to examine a person on oath and any statement made by such person during such examination can also be used in evidence under the IT Act. On the other hand, whatever statement recorded under s. 133A of the Act is not given an evi .....

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to take any sworn statement and that a mere admission or an acquiescence cannot be a foundation for an assessment and that any statement given during a survey has no effect as an "admission" nor can it be a statement on oath. According to the assessee, his statement during the survey with reference to any books of account can hardly be the basis for any assessment. It was also contended on behalf of the assessee that any material collected or any statement recorded during the survey un .....

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nfer such power to examine a person on oath, the same has been expressly provided whereas s. 133A does not empower any ITO to examine any person on oath. Thus, in contradistinction to the power under s. 133A, s. 132(4) of the IT Act enables the authorised officer to examine a person on oath and any statement made by such person during such examination can also be used in evidence under the IT Act. On the other hand, whatever statement is recorded under s. 133A of the IT Act, it is not given any .....

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1, would include the materials gathered during the survey operation under s. 133A, came up for consideration before this Court in CIT vs G.K. Senniappan (2006) 203 CTR (Mad) 447 : (2006) 284 ITR 220 (Mad), a Division Bench of this Court, in which one of us was a party (P.P.S. Janarthana Raja, J.), answered the question in the affirmative, against the Revenue and in favour of the assessee, holding that the materials collected during the survey under s. 133A cannot be taken into consideration whil .....

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300 ITR 152, of course, following the earlier decision of this Court in CIT Vs.. G.K. Senniappan's cas reported in (2006) 284 ITR 220, while confirming the order of the Tribunal, answered the question in favour of the assessee, in limine. 13. What is more relevant, in the instant case, is that the attention of the CIT(A) and the Tribunal was rightly invited to the circular of the CBDT dt. 10th March, 2003 with regard to the confession of additional income during the course of search and sei .....

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arch and seizure and survey operations do not serve any useful purpose. It is, therefore, advised that there should be focus and concentration on collection of evidence of income which leads to information on what has not been disclosed or is not likely to be disclosed before the IT Department. Similarly, while recording statement during the course of search and seizure and survey operations no attempt should be made to obtain confession as to the undisclosed income. Any action on the contrary s .....

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t it is incorrect and that the assessee should be given a proper opportunity to show that the books of accounts do not correctly disclose the correct state of facts, vide decision of the apex Court in Pullangode Rubber Produce Co. Ltd. Vs.. State of Kerala (1973) 91 ITR 18; (ii) In contradistinction to the power under s. 133A, s. 132(4) of the IT Act enables the authorised officer to examine a person on oath and any statement made by such person during such examination can also be used in eviden .....

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IT Act, 1961, would (not) include the materials gathered during the survey operation under s. 133A, vide CIT Vs.. G.K. Senniappan (2006) 284 ITR 220 (Mad); (iv) The material or information found in the course of survey proceeding could not be a basis for making any addition in the block assessment, vide decision of this Court in Tax Case (Appeal) No. 2620 of 2006 (between CIT Vs.. S. Ajit Kumar); (v) Finally, the word "may" used in s. 133A(3)(iii) of the Act, viz., "record the sta .....

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tatement obtained under s. 133A would not automatically bind upon the assessee, we do not see any reason to interfere with the order of the Tribunal. 18. In view of the above decision of the High Court of Madras, we are of the considered view that the statement given by one of the partners stating during survey proceedings that there is wrong claim made u/s. 80IB of the Act and offering the same for taxation has no evidentiary value unless there is corroborative evidence on record suggesting tha .....

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unit in 2007. This statement was also retracted later on by Mr. Abhiram Bhattacharjee stating that the statement was taken in the course of survey was on a spur of moment when he visited the builders office for personal work. The statement was given under tension on account of office related work. By letter dated 23.12.2007, Shri Abhiram Bhattacharjee alongwith his wife Sucharita Bhattacharjee and Shri Ajit Bhattacharjee have stated that they have purchased three different residential flats bea .....

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urchase. 20. We also find from the assessment order that the Inspector in his report has categorically stated that the purchasers acquired the flats by separate sale deeds, after the possession the necessary changes have been made by themselves to make it bigger flat as per their requirement at their own cost. It is also the finding of the Inspector who visited the flats and stated that the flats are as per approved plans (a) there is no change in the external water and sanitary fittings from th .....

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st of the flats have also exceeded 1,000 Sq. ft. When enquired from the society member regarding internal changes of the flats, they informed that in most of the flats common passages in front of flats are merged with the flat area. Kitchen place as per original plan is converted into bedroom. Living room place as per original plan has been converted into bed room. There are internal changes done by the flat owners at their cost as informed by them to me. So it is very difficult to ascertain the .....

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le deeds and subsequently they have joined the flats on their own at their own cost. There is no evidence on record to suggest that the builder has constructed the residential unit with a built-up area of more than 1000 Sq. ft. in violation of the master plan and sold to the purchasers. There is no dispute infact that as per the approved plans built up area of each residential unit is less than 1000 Sq. ft, and the residential units were sold by executing separate sale deeds. In such circumstanc .....

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exceeding 1000 sq.ft. B.U. area Builtup area of each flat as approved by CIDCO is less than 1000 sq.ft. B.U. area as per the approved plan and the assessee has sold each flat under separate agreements and not sold two flats by combining them together as one flat to one partyFurther, there is no evidence on record to suggest that the assessee has drawn the plan in such a manner that each residential unit is shown as smaller than 1000 sq.ft. merely to get benefit of deduction u/s.80IB( 10)It is al .....

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e housing project is allotted to one person not being an individual has been inserted by Finance (No.2) Act, 2009, w.e.f. 1st April, 2010, and hence it is not applicable to the facts of the case." 22. Similar view has been taken by the Co-ordinate Bench in the case of Emgeen Holdings (P) Ltd Vs DCIT 12 Taxmann. Com 468 (Mum) wherein it has been held as under: We find that the deduction u/s.80IB(10) has been declined by the Assessing Officer on the ground that size of the residential unit wa .....

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ucted or planned in such a way that two flats could indeed be merged into one larger unit, as long each flat was an independent residential unit, deduction u/s.80IB(10) could not be declined. It is important to bear in mind the fact that what section 80IB(10) refers to is residential unit and, in the absence of anything to the contrary in the Income tax Act, the expression residential units must have the same connotations as assigned to it by local authorities granting approval to the project. T .....

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ore, clear is that so far as preamendment position is concerned , as long a residential unit has less than specified area, is as per the duly approved plans and is capable of being used for residential purposes on standalone basis, deduction u/s.80IB(10) cannot be declined in respect of the same merely because the end user, by buying more than one such unit in the name of family members, has merged these residential units into a larger residential unit of a size which is in excess of specified s .....

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unit in such housing project is allotted to any of the following person, namely (i) the individual or the spouse, or the minor children of such individual, (ii) the HUF in which such individual is a karta (iii) any person representing such individual, the spouse or minor children of such individual, or the 7 HUF in which such individual is a karta. The explanation memorandum explained the legislative amendment as follows: (314 ITR(St) 203) Further, the object of the tax benefit for housing proj .....

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ject to the same person, not being an individual, and where the person is an individual, no other residential unit in such housing project is allotted to any of the following person:- (I) Spouse or minor children of such individual; (II) The Hindu undivided family in which such individual is the karta; (III) Any person representing such individual, the spouse or minor children of such individual or the Hindu undivided family in which such individual is the karta. This amendment will take effect .....

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lear that unless provided in the Statute, the law is always presumed to be prospective in nature. It will, therefore, be contrary to the scheme of law to proceed on the basis that wherever adjacent residential units are sold to family members, all these residential units are to be considered as one unit. If law permitted so, there was no need of the insertion of clause (f) to section u/s 80IB(10). It will be unreasonable to proceed on the basis that legislative amendment was infructuous or uncal .....

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because assessee, at some stage, decided to give up the same. In view of these discussions, and bearing in mind entirety of the case, are of the considered view that the deduction u/s.80IB(10) ought to have been allowed to the assessee entirely. To this extent, we modify the order of the CIT(A) and allow further relief to the assessee . 23. The Ld. CIT(A) also held that claim u/s. 80IB(10) was allowed in the original assessments made u/s. 143(3) of the Act and it is also the finding of the Ld. .....

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le amount was obtained • Area which was stated in the occupation certificate issued by the local authority No physical verification of any of the building was carried out during the course of survey of the built up area of any of the residential unit. The only evidence that the wing had was the statement of Shri Abhiram Bhattacharjee who stated that he had purchased 3 flats 1407, 1408 and 1409 in Building no 24 and the same was purchased as a single flat. The Addl CIT directed that in VIew .....

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ve merged the flats. The direction of the Addl ClT is based on the statement of Shri Abhiram Bhattacharjee which was recorded on March 30, 2011. However Shri Abhiram Bhattacharjee, had filed a letter dated December 23, 2011 with the ADlT (lnv) which clearly retracted his earlier stand. Further, the letter is signed by Shri Abhiram Bhattarharjee, Smt Sucharita Bhattacharjee and Shri Ajit Kumar Bhattacharjee who are the owners of the flats. This letter was not considered by the AO or theAddl CIT. .....

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he Subregistrar • Area for which the sale amount was obtained • Area which was stated in the occupation certificate issued by the local authority The building plans approved clearly show that each flat is of less than 1000 sq. ft. The occupation certificate clearly states that the building is constructed as per the approved plans and in which none of the flat is above 1000 sq. ft. The occupation certificate is issued by the local authority, State Govt. Body only after inspection of the .....

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nvestigation wing, nor the inspector could find any single physical evidence of sale of single flat in the entire complex which was more than 1000 sq. ft. apart from the statement of Shri Abhiram Bhattacharjee, wherein also neither physical measurement of his flat were taken nor the copies of his sale deed were inspected and verified to check whether indeed the sale of flat to him was of more than 1000 sq .. ft. It was also not verified whether the builder himself modified the flat and gave it t .....

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s recorded after 4 years of the purchase of the said flat. This statement was also withdrawn vide letter dated December 23, 2011. Apart from the statement of Shri Abhiram Bhattacharjee, there is nothing on record which shows that 2/3 flats were sold as a single unit. However on the basis of spot verification by the Inspector for building No. 23 he had reported that the flats were sold separately and some of the buyers later on merged the flats at their own cost. The inspector has also stated tha .....

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