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2017 (5) TMI 204 - ITAT RAJKOT

2017 (5) TMI 204 - ITAT RAJKOT - TMI - Claim of deduction under Section 80IB(10) - fulfillment of conditions - as per AO assessee was unable to get approval of the housing project by the Municipal Corporation as separate building plans for each of the units - Held that:- As relying on in assessee’s own case for AY 2011-12 and case of B.M. and Brothers [2013 (10) TMI 290 - GUJARAT HIGH COURT ] wherein observed that as the assessee has taken the approval in respect of the housing project more than .....

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npura, AR ORDER PER MANISH BORAD, ACCOUNTANT MEMBER: This appeal of Revenue for Assessment Year 2010-2011 is directed against the order of the Commissioner of Income-tax (Appeals)-11, Ahmedabad dated 29.01.2015 vide appeal No.CIT(A)-11/485-R/CC.2/2014- 15, arising out of order u/s 143(3) of the Income-tax Act, 1961 (herein after referred to as the Act ) dated 25.03.2013 framed by the DCIT, Central Circle-2, Rajkot. 2. The solitary grievance of the Revenue is against the order of the ld. CIT(A) i .....

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wed by 142(1) along with detailed questionnaire was issued. Necessary replies with details as called for were furnished. The assessee has undertaken a residential project called Jivraj Township which was commenced during FY 2006-07. The ld. Assessing Officer denied the deduction under Section 80IB(10) of the Act by observing that the assessee was unable to get approval of the housing project by the Municipal Corporation as separate building plans for each of the units. 4. Aggrieved, the assessee .....

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o avail the claim of deduction under Section 80IB(10) of the Act. 5. Aggrieved, the Revenue is now in appeal before us. 6. At the outset, ld. Counsel for the assessee submitted that the issue raised in this appeal is squarely covered by the decision of the Co-ordinate Bench in assessee s own case for AY 2011-12 in ITA No.209/Rjt/2015, pronounced on 05.12.2016, wherein the Co-ordinate Bench has dismissed the Revenue s appeal raising similar issue. 7. On the other hand, ld. Departmental Representa .....

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uction projects. We observe that ld. Counsel as referred and relied upon the decision of the Co-ordinate Bench in assessee s own case in ITA No.209/Rjt/2015 (supra) for AY 2011-12, where the Co-ordinate Bench has dismissed the Revenue s appeal by observing as follows:- 8. Aggrieved by this, the assessee carried the matter before the ld. CIT(A) and reiterated its claim of deduction u/s 80IB(10) of the Act. The assessee drew the attention of the First Appellate Authority to the decision of the Hon .....

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drew support from the decision of the Hon'ble Jurisdictional High Court in the case of B.M. and Brothers 42 Taxmann.com 24, The relevant extract of the decision in the case of B.M. and Brothers (supra) is as under:- 5. We have heard Shri Pranav Desai, learned Counsel appearing on behalf of the appellant-revenue and considered the orders passed by the ITAT as well as CIT(A). It is required to be noted that the layout plan of the 'housing project' named 'Maninagar' at Rajkot c .....

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ompleted prior to 31/03/2008. The C1T(A) while granting deduction under Section 80-IB(10) of the Act with respect to those units approved prior to 01/04/2004 and granted prior to 31/03/2003 has observed in paragraph 3,4 as under: 3.4 I have carefully considered the finding given by the Assessing Officer and the contentions of the AR of the appellant. The main basis of not allowing deduction u/s. 80-IB(10) by the A.O. appears to be the averment of the A.O. that the assessee has taken 69 approvals .....

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ic conditions laid down in Section 80-IB(10) and that is why the claim of deduction was disallowed. However, the above contentions of the A.O. is not correct. Firstly, he has not clearly pointed out which of the conditions laid down u/s 80-IB(10) are not fulfilled by the appellant. As regarding his averment that Section 80-IB(10) uses the word 'approval' and not approvals' for housing project it appears that the A.O. has not properly gone through the other provisions of Section 80- I .....

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roved by the local authority. (ii) the date of completion of construction of the housing project shall be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority. Thus, from (I) above, it is clear that more than one approvals has also been envisaged by the Legislature in the Act and that is why it is mentioned 'in a case where the approval in respect of the housing project is obtained more than once..,'. Thus, there is .....

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ance under the provisions of Section 80-IB(10) of the Act because the provisions only speak about the approval or date of completion. As far as the condition of the area of project is concerned it should be more than one acre, here in the case of appellant the project 'Maninagar having 119 units -was constructed on an area of 3.33 Acres. Similarly, the condition regarding built-up area per unit should be less than 1500 sq. ft. and there is no dispute regarding that in the appellant's cas .....

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The argument of the AR of the appellant is that during the year under consideration only 21 units have been sold and in case of all these units- construction was completed before 31/03/2008. However, in my considered opinion, the units construction of which has been completed after 31/03/2008 will not be eligible for benefit u/s. 80- IB(10) in any year. From the copies of the commencement and completion certificate issued by the RMC it is found that the same has been issued in the name of appel .....

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dential housing project known as 'Maninagar' having composite residential units. The appellant also relied on the decision in the case of Vandana Properties [27 DTR (Mum) 282 (2009)], wherein it has been held by the Hon'ble Tribunal that the approval for separate buildings can be granted and that mil not affect the claim of the assesses u/s. 80-IB (10) of the Act. Moreover, the Hon'ble ITAT, Bangalore in the case of Brigade Enterprises (P) Ltd, (119 ITJ 269) has held that althoug .....

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the appellant u/s. 80-IB is allowed and the addition made of ₹ 1,45,67,940/- is hereby ordered to be deleted. However, the A.O. is directed to see if the construction of any unit is completed after 31/03/2008 during the year the eligible profit on the sale should be excluded from the 80-IB(10) deduction. Similarly for the assessment year subsequent to the A. Y. 2008-09 also he should keep in mind that whatever units -which are sold after A.Y. 2008-09 and where date of completion is after 3 .....

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ror granting deduction under Section 80-IB(10) of the Act with respect to only those units of 'housing project' named 'Maninagar' approved prior to 01/04/2004 and of which constructions have been completed prior to 31/03/2008. It cannot be disputed that the 'housing project' named 'Maninagar' was already approved prior to 01/04/2004 with respect to different units. The 'housing project' was approved prior to 01/04/2004 and constructions that have been put .....

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