9911796707
TMI Blog2017 (11) TMI 1590X X X X Extracts X X X X X X X X Extracts X X X X ..... or deduction under section 80-IB of the Income Tax Act, 1961 (hereinafter called "the Act"). 2. The brief facts of the case are that the assessee company is engaged in the business of developing and building housing projects. The return of income was filed declaring an income of Rs. 19,59,220/- and book profit under section 115 JB at nil. The assessee had claimed deduction of Rs. 3,64,15,637/- under section 80- IB of the Act. The AO was of the view that the assessee company was not eligible for such deduction and he proceeded to assess the company on a total income of Rs. 3,64,15,637/-. The AO observed that for deduction under section 80-IB of the Act, the undertaking must commence the housing project on or after the 1st day of October 199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nds of appeal - "1. That on the facts and circumstances of the case and in law the Ld. CIT(A) erred in deleting the addition of Rs. 3,44,56,419/- made on account of disallowance of deduction u/s 80-1B of the Income Tax Act, 1961. 2. That on the facts and circumstances of the case and in law the Ld. CIT(A) erred in accepting the assessee plea that development and construction of the project was commenced after 01.10.1998 in the assessee's case. 3. That on the facts and circumstances of the case, the Ld.CIT(A) erred in accepting the assessee plea that built up area of residential units of the project was less than 1000 sq. ft. 4. That on the facts and circumstances of the case and in law theLd. CIT(A) erred in accepting the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re not disputed. The Ld. Authorised Representative submitted that the Ld. CIT (Appeals) has recorded a factual finding that the assessee had not carried out any change in land prior to 1st of October 1998. It was submitted that there was no development in the land and the construction was started only after 1st day of October 1998. It was also submitted that the assessee was granted deduction in preceding assessment years 2000-01, 2001-02, 2002-03, 2003-04, 2004-05 and 2005-06 and subsequent assessment year 2007-08. The Ld. Authorised Representative also submitted that the date of approval to the project by Noida Development Authority prior to 01/10/1998 cannot be taken as commencement of development and construction activities. The Ld. Aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ld. authorised representative placed extensive reliance on the order of the Ld. CIT (Appeals) and argued that the deduction had been rightly allowed by the Ld. First Appellate Authority on both the counts. 5. We have heard the rival submissions and have also perused the material on record. As far as the issue of date of commencement of the project is concerned, the Ld. first appellate authority has recorded a finding that no development activity was carried on by the assessee prior to the appointed date, that is, 01/10/1998. A perusal of the assessment order shows that the AO has treated the date of approval of the project by the Noida authority, i.e., 03/09/1998 as the date of commencement of project. However, this reasoning of the AO see ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chitects. It is undisputed that the project was completed in the year 2001 and at that point of time, the definition of built up area was not in the Act. The assessee had furnished sale deeds before the AO where in the built up area was less than 1000 ft.². These sale deeds were not found to be incorrect or fabricated. The sale deeds have been signed both by the buyers as well as by the seller and have been duly witnessed. The assessee has also submitted certificates from the architects regarding the two projects "Kingston" and "Monarch" with respect to the built up area. The AO was called upon by the Ld. CIT (Appeals) to furnish remand report in respect of the certificates relating to these two projects and the Ld. CIT (Appeals) has n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d construction of the housing project and that an assessee cannot be called upon to comply with the said condition when it was not in contemplation either of the assessee or even the Legislature when the housing project was accorded approval by the local authorities. 5.2 Therefore, respectfully following the ratio of the judgments of the Hon'ble Apex court in the case of Sarkar Builders (supra) as well as of the Hon'ble Allahabad High Court in the case of Arif Industries Ltd (supra) we find no reason to interfere with the adjudication of the Ld. CIT (Appeals) on this issue also. 5.3 Ground No. 5 of the appeal mentions that the deduction under section 80-IB of the Act was disallowed in the assessee's case in assessment year 2002- 03, 2003- ..... X X X X Extracts X X X X X X X X Extracts X X X X
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