TMI Blog2017 (12) TMI 304X X X X Extracts X X X X X X X X Extracts X X X X ..... re was no error in the order of the A.O. in allowing the claim of the assessee for deduction under section 80IB in respect of electrical installation charges and club membership fees received from the flat holders of the project. As regards the other error allegedly pointed out by the Ld. CIT in the order of the A.O, we find merit in the contention of the learned counsel for the assessee that the relevant amendment to section 80IB(10) having been made with effect from 01.04.2010 i.e. much after the sanction of the housing project of the assessee on30.03.2007, the same was not applicable in the case of the assessee as held in the case of CIT vs Sarkar Builders (2015 (5) TMI 555 - SUPREME COURT) and the order of the A.O. cannot be regarded as erroneous on the ground that the applicability of the said amendment in the case of the assessee was not considered by him. In our opinion, there were thus no errors in the order of assessment made by the A.O. under section 143(3) as alleged by the Ld. CIT warranting revision under section 263. Thus we set aside the impugned order passed by the Ld. CIT under section 263 and restore that of the A.O. passed under section 143(3). - Decided in fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is required to be considered for taxation. However, A.O. while assessing the case, allowed the said other income of ₹ 1,81,42,455/- as eligible income for the deduction under section 80IB(10) of the IT Act, 1961. ( ii) It was observed from the assessment record that the assessee firm had constructed 368 flats covering 3,57,600 sq.ft. built up area for 1BHK, 2BHK and 3BHK flats other than 555 saleable parking space covering area 1,07,507 sq.ft. (4,65,107 sq.ft. 3,57,600 sq.ft). On verification of the list of the allottees, it was observed that in many cases more than one flat (like 1BHK, 2BHK and 3BHK measuring more than 1500 sq.ft.) had been allotted to the same person / related person(s). It is also seen that though the flats were booked in the year 2008 i.e. prior to 2009-10, the assessee firm was required to restrict the sale of 1 (one) flat measuring within 1500 sq.ft. against 1 (one) person / related person(s) at the time of selling the flats during the F.Y. 2011-12, in order to get the deduction u/s 80IB(10) [as amended from the A.Y. 2010-11] for the A.Y. 2012-13. The conditions laid down in such sections (e) and (f) of section 80IB(10) are that the buil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g project only. It is found that Hon ble Bombay High Court in the case of CIT vs Vandana Properties (2012) has observed as under: 17. The first question to be considered herein is, whether, in the facts of the present case, construction of E building constitutes building a housing project under section 80IB(10) of the Act. 18. The expression housing project is neither defined under section 2 of the Act nor under section 80IB(10) of the Act. Even under the Mumbai Municipal Corporation Act, 1988 as also under the Development Control Regulation for Greater Mumbai1991, the expression housing project is not defined. Therefore, housing project in section 80IB(10) would have to be construed as commonly understood. 19. As rightly contended by Mr. Imandar, learned Senior Advocate appearing on behalf of the assessee and Mr. Mistri, learned Senior Advocate and Mr. Joshi, learned Advocate appearing on behalf of the interveners, the expression housing project in common parlance would mean constructing a building or group of buildings consisting of several residential units. In fact, the Explanation in section 80IB(10) supports the contention of the assessee that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by any subsequent amendment of law as decided by various courts of law and tribunals. The law applicable to the housing project shall be the then existing law which was applicable at the time of sanction of plan. When the plan was sanctioned, there was no restriction regarding sale of flats to same individual or his relative/s. Hence the law relating to allotment of flat to any related person could not be applied in the year under appeal as the project was sanctioned long before the new law reg. The same came into force. The project had started well before the date. The definition of area of the flat built up area has been defined in the act:: the agreements by the company has been entered into reference to SUPER BUILT UP AREA. WHEREAS THE act restrict the area to 1500 sq.ft. with reference to built up area. Therefore, this restriction is not applicable in the case of the firm. Without prejudice, this is to submit that the individuals as referred in your show cause notice have been sold one flat only. The other portion, being utility area is not a flat. The flat in normal description menas a place habitable with kitchen, bedroom, etc. In the smaller area sold to each one of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... there was a sufficient cause for the delay of 3 days on the part of the assessee in filing this appeal before the Tribunal. Even the learned DR has not raised any objection in this regard. We, therefore, condone the said delay and proceed to dispose of the appeal of the assessee on merit. 6. The learned counsel for the assessee submitted that club membership fees and electrical installation charges were collected by the assessee from the flat holders of the project as per the agreement in addition to the total consideration agreed for the flats. In this regard, he invited our attention to the copy of sample agreement placed at page no 57 to 59 of the Paper Book and submitted that electrical installation as well as club was the integral part of the project developed and constructed by the assessee. Relying on the decision of the Hon ble Delhi High Court in the case of Principal CIT vs Omaxe Buildhome (P) Ltd. 76 taxman.com 104 (Delhi), he contended that infrastructural facilities and amenities are to be treated as part of the housing project for allowing deduction under section 80IB. He also took us through the copies of written submission filed by the assessee before the A.O. du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 80IB w.e.f. 01.04.2010, the issue relating to the applicability of the said amendment to the year under consideration was not examined by the A.O as rightly pointed out by the Ld. CIT in his impugned order passed under section 263. He contended that the assessment order passed by the A.O. under section 143(3) thus was erroneous as well as prejudicial to the interest of the revenue and the Ld. CIT was fully justified in revising the same by exercising the power conferred upon him under section 263. 9. In the rejoinder, the learned counsel for the assessee invited our attention to the copy of order-sheet entries placed on record to show that the case of the assessee was heard by the A.O. on 14 15 occasions. He contended that proper and sufficient enquiry thus was made by the A.O. on the issue of assessee s claim for deduction under section 80IB and after having satisfied with all the relevant documents and details filed by the assessee, the claim of the assessee for deduction under section 80IB was allowed by the A.O. He contended that the order of assessment made by the A.O., in these facts and circumstances of the case, therefore, cannot be said to be erroneous merely becaus ..... 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