TMI Blog2016 (4) TMI 1232X X X X Extracts X X X X X X X X Extracts X X X X ..... on to disallow the claimed deduction, simply, because, the layout plan was entire land which was common for various buildings but the fact remains that for the remaining buildings, no such claim was made by the assessee, therefore, there is no reason to include buildings, A, B, E and F as part of the project for claiming deduction u/s 80IB(10) of the Act. So far as, the letter from the municipal corporation, Thane, is concerned, it is not relevant because for the remaining building, no deduction was claimed u/s 80IB(10) by the assessee. We are satisfied that requisite details were duly furnished by the assessee and the same were duly examined by the Assessing Officer. In such a situation, we are of the view, that there is a distinction between “lack of enquiry” and “inadequate enquiry”. In the present case the Assessing Officer collected necessary details, examined the same and then framed the assessment u/s. 143(3) of the Act. We set aside the order of the ld. Commissioner holding that invoking of revisions jurisdiction u/s 263 of the Act - Decided in favour of assessee. - ITA NOs.1312 And 1313/MUM/2012 - - - Dated:- 5-4-2016 - Shri Joginder Singh, Judicial Member And Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... la (ITA No.7724/Mum/2010) order dated 03/08/2012, Madhur M. Gupta vs ACIT (51 DTR 217)(Mum.)(2011), DCIT vs Magarpatta Township Development and Construction Co. 141 ITD 682 (Pune)(2012), M/s Rahul Construction Company vs ITO (ITA No.1250/Pn/2009 and 707/PN/2010) order dated 30/03/2012 of the Pune Bench of the Tribunal, ITO vs Cosmos Enterprises (ITA No.6744/Mum/2010) order dated 15/10/2013, ACIT vs Cosmos Realtors ORs. (ITA No.5360/Mum/2010) order dated 28/02/2014 and CBDT Notification No.205/3/2001/ITA II dated 04/05/2011. Further the ld. counsel contended that for the projects approved prior to 31/03/2005, the restriction of commercial area imposed by sub-section (d) to section 80IB(10) is not applicable, for which reliance was placed upon the decision in CIT vs Sarkar Builders (119 DTR 241)(2015)(SC) and CIT vs Brahma Associates (333 ITR 289) (Bom.)(2011). 2.1. On the other hand, the ld. DR, Shri Sunil K. Jha, defended the invocation of revisional jurisdiction by inviting out attention to page-3 (para-7) of the impugned order by contending that the assessee has not fulfilled the conditions mentioned in sections 80IB(10) and the remaining buildings are part of the same proje ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he ld. Assessing Officer duly examined the evidences filed by the assessee, bases of claim and found that the assessee has duly fulfilled the conditions laid down u/s 80IB(10) of the Act and accepted the claim of the assessee as is oozing out para 10.2 of the assessment order. For ready reference, the same is reproduced hereunder:- 10.2. During the relevant previous year sales were affected from Phase-II for Ochana and Allamanda buildings. A separate Profit loss Account has been prepared and a net profit of ₹ 8,02,85,320/- was disclosed and claimed this profit as deduction u/s 80IB(10) of the I.T. Act. The case has been examined on the basis of the evidences produced by the assessee and it is found that all the conditions as laid down u/s 80IB(10) are satisfied and found that the claim of the assessee for deduction u/s 80IB(10) is acceptable. 2.3. It is also noted that the ld. Assessing Officer found that the assessee affected sales of parking units of Phase-I (Norita of Pride Park) for which separate profit loss account was maintained and the amount of ₹ 1,15,000/- was also claimed as deduction u/s 80IB(10), which was denied as deduction with a reasoni ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... no reason to disallow the claimed deduction, simply, because, the layout plan was entire land which was common for various buildings but the fact remains that for the remaining buildings, no such claim was made by the assessee, therefore, there is no reason to include buildings, A, B, E and F as part of the project for claiming deduction u/s 80IB(10) of the Act. So far as, the letter from the municipal corporation, Thane, is concerned, it is not relevant because for the remaining building, no deduction was claimed u/s 80IB(10) by the assessee. 2.7. It is also noted that the Tribunal for A.Y. 2005- 06, vide order dated 03/08/2012 (ITA No.7724/Mum/ 2010) in the case of DCIT vs Krunal Pravinchandra Gala (present assessee) on the issue of existence of commercial area in the housing project approved prior to 01/04/2005 and claim of deduction u/s 80IB(10) dismissed the appeal of the Revenue. The relevant portion of the order is reproduced hereunder for ready reference:- This appeal has been filed by the department against the order dated 13-8-2010, passed by the CIT(A)-II, Thane for the quantum of assessment passed under Section 143(3) for the assessment year 2005- 2006 on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase bills of material, which were separately identified and the agreements for sale of premises in respect of both the projects. The said submissions have been incorporated by the CIT(A) from page 4 to 10 of the appellate order. The CIT(A) after considering the facts and submissions of the assessee allowed the claim of the assessee on various counts, firstly, that similar issue has been decided in favour of the assessee by the CIT(A) for the assessment year 2004-2005; secondly, on the fact, it was clear that the assessee has not included the commercial area of the project Pride Park for the purpose of any claim under Section 80IB(10), hence, there was no point of making disallowance of such claim by the Assessing Officer and that claim under Section 80IB(10) pertains purely for residential units, which satisfied all the conditions and thirdly, the assessee s case, otherwise also, is covered by the decision of the ITAT Special Bench in the case of Brahma Associates , and various other decision of the Tribunal, like M/s. Saroj Sales Corporation Vs. ITO, reported in 3 DTR (Trib.)(Mum) 494. 4. At the outset, learned counsel submitted that this issue now stands covered by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .9. The case of the assessee is further fortified by the decision in Siddhi Real Estate Developers vs CIT (ITA No.2630 to 2635/Mum/2012) order dated 13/05/2014 and CIT vs Vandana Properties (2012) 353 ITR 36 (Bom.) and various decisions (supra) relied upon by the assessee. 2.10. If the issue of section 263 is analyzed with the help of various other decisions, the landmark decision from Hon ble Apex Court is Malabar Industrial Company Ltd. Vs CIT (2000) 243 ITR 83 (SC); (2000) 109 taxman 66 (SC) holding that before invoking jurisdiction u/s 263 of the Act, the assessment order should be erroneous as well as prejudicial to the interest of Revenue. The Hon ble Court held that if the Revenue is losing tax lawfully payable by a person, it will be prejudicial to the interest of the Revenue. However, every loss of Revenue, as a consequence of order of Assessing Officer, cannot be treated as prejudicial to the Revenue. 2.11. The Assessing Officer issued notice dated 11/10/2010 (page 26 of the paperbook) to the assessee, which was replied by the assessee on 18/10/2010 (pages 27 28 of the paperbook). It is noteworthy that before framing the assessment u/s 143(3) of the Act, the asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e E . In the said regards, we clarify that as per the regulations of the Municipal Corporation. It is mandatory to reflect existing buildings already constructed on any plan put up for new construction. It is accordingly the case that the already constructed buildings i.e. Type B (Pride Plaza) and Type A (Norita) are also reflected in figured dimensions i.e. shaded colour as per the requirement of the municipal authorities. It is for this reason that building B 1 having area of only 945 sq. mtrs, the development rights of which have been sold by me in previous year relevant to A.Y. 2005-06 is also reflected on the said plan inspite of the fact that the said building is Krunal Pravinchandra Gala not part of my project Pride Park and is constructed by a third party. A certificate from Architect, M/s. Archetype Consultations (1) Ltd. confirming the above fact is enclosed as Annexure F . I further clarify that the V.P.No. for each plot is common and the same number continues in the commencement certificate always. It is for this reason that all subsequent building sanctions are termed as amended permissions by the local authority. This is as per the procedure of municipal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer had investigated the issue and applied his mind towards the whole record made available by the assessee during assessment proceedings. Uncontrovertedly, necessary details were produced by the assessee and examined by the Assessing Officer, therefore, it is not a case of lack of enquiry by the Assessing Officer. Identical ratio was laid down by the Tribunal in the case of Reliance Gas Transportation Infrastructure Ltd. vs. CIT (2014) 100 DTR (Mum.) (Trb.) 1, order dated 10/1/2014. In another case from Hon'ble Jurisdictional High Court in CIT vs. Development Credit Bank Limited (2010) 323 ITR 206, on identical fact wherein assessment order was passed after considering all details called for and furnished by the assessee. The ld. Commissioner invoked revisional jurisdiction on the ground that enquiry was not conducted, the Hon'ble High Court held that the ld. Commissioner was not justified. Identical is the situation from Hon'ble High Court Punjab Haryana in Hari Iron Trading Company vs. CIT (263 ITR 437) order dated 23/5/2003. The Hon'ble High Court of Delhi in CIT vs. Eicher (294 ITR 310) (Del.) wherein the entire material was placed by the assessee before the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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