TMI Blog2014 (1) TMI 1830X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessing Officer. Thus, these grounds of Revenue’s appeal are dismissed. TDS u/s 194C - amount paid to M/s.Parmar Builders for construction of ‘B & C’ building without deducting TDS - disallowance of expenditure u/s.40(a)(ia) - Held that:- CIT(A) has allowed this ground by observing that additional disallowance made do not loose the characteristic of being derived from the housing project developed by an undertaking as its original source. Therefore, even if the expenditure is disallowed, the same is entitled for deduction u/s.80IB of the Act on the income computed from the business of an undertaking developing and building a housing Project. Since the Revenue could not controvert this finding of the ld.CIT(A), therefore we hereby upheld the order of the ld.CIT(A) and reject this ground of Revenue’s appeal. - ITA No 2408/Ahd/2009, 2409/Ahd/2009, 3131/Ahd/2010 - - - Dated:- 31-1-2014 - SHRI N.S. SAINI, ACCOUNTANT MEMBER And SHRI KUL BHARAT, JUDICIAL MEMBER Revenue by : Shri P.L.Kureel, Sr.DR Assessee by : Shri J.P.Shah Sr.Adv. with Shri M.J.Shah O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : These three appeals by the Revenue in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ven direction to the AO to delete the addition made on account of disallowance of expenditure of ₹ 79,48,600/- u/s.40(a)(ia) of the IT Act. Aggrieved by the order of the ld.CIT(A), now the Revenue is in appeal before us. 3. Ground Nos.1 2 are inter-connected. The ld.Sr.DR strongly supported the order of the AO and submitted that the ld.CIT(A) was not justified in deleting the addition. He submitted that the assessee was not eligible for deduction u/s.80-IB(10) of the Act. He submitted that the ld.CIT(A) has wrongly applied the ratio laid down by the Hon ble ITAT Mumbai in the case of Saroj Sales Organization vs. ITO (115 TTJ 485). He submitted that the admitted position remains that the assessee had applied for a composite housing project and he had not completed the entire project. 3.1. On the contrary, ld.counsel for the assessee supported the order of the ld.CIT(A). He submitted that the ld.CIT(A) has examined the issue thoroughly and after seeking remand report from the AO on various occasions. The ld.counsel for the assessee submitted that the ld.CIT(A) has rightly followed the decision of the Hon ble Tribunal rendered in the case of Saroj Sales Organization vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e project is on the size of a plot of land, which has a minimum area of 1 acre. A fact, evident from the certificate of Chief Officer, Silvassa Municipal Council, Silvassa. vii. The residential unit has the maximum built-up area as specified. A fact not disputed by AO. viii. The fact relating to commercial area of 2000 sq.ft. This has been considered as per the letter dated 27/11/2007 by the Architect where he has confirmed that no shops have been constructed in B C D buildings. 7.4. Various issues raised by AO in connection with fulfillment of the above conditions have been dealt with while analyzing the facts and reasoning for denial of the deduction. 7.5. The basic issue, in the entire matter, is whether where an assessee has undertaken the development and construction of only a part of the project, can it be regarded as a housing project and accordingly eligible for the deduction? In other words, considering the present case and the facts thereof, where the appellant undertook the project of development and construction of only three buildings out of the approved project for nine buildings, the project of three buildings could be regarded as a housing project and, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he decision of Hon ble Madras High Court in the case of Viswas Promoters Pvt.Ltd. vs. ACIT (supra), wherein the Hon ble High Court under the identical facts held that the assessee is entitled to succeed both on the principle of proportionality as well as by reason of the construction on the meaning of the expression housing project as referring to construction of any building and the wordings in Section 80IB(10) of the Act. The Honb le High Court further held that mere fact that one of the blocks have units exceeding built-up area of 1500 sq.ft., per se, would not result in nullifying the requirement under section 80IB(10)(c) of the Act. Therefore, respectfully following the ratio laid down by the Hon ble Madras High Court in the case of Viswas Promoters Pvt.Ltd. vs. ACIT(supra) coupled with the fact that the ld.CITR(A) has given a detailed finding on fact that meets all the objections of the Assessing Officer. Thus, these grounds of Revenue s appeal are dismissed. 5. The third ground is against the deletion of disallowance of expenditure of ₹ 79,48,000/- u/s.40(a)(ia) of the IT Act. The AO made addition u/s.40(a)(ia) in respect of ₹ 79,48,599/- paid to M/s.Parmar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that of the Assessing Officer be restored. The appellant crave to add, alter or amend any grounds of appeal. (B) In ITA No.3131/Ahd/2010 for AY 2007-08 1. On the facts and circumstances of the case and in law, the learned CIT(A) has erred in directing the AO to allow deduction u/s.80IB of the Act of ₹ 81,54,803/- on income computed from the business of an undertaking developing and building a housing project, even though the land and approval is not in assessee s name and construction is not as per approved plan. 2. It is therefore, prayed that the order of the learned CIT(A) be set aside and that of the Assessing Officer be restored. The appellant craves to add, modify or alter any grounds during the course of appeal proceedings. 9. The facts are identical in both the cases as were in Revenue s appeal in assessee s own case for AY 2005-06. Since no difference in facts could be pointed out by Ld. DR of the Revenue in these Assessment Years 2006-07 2007-08, we do not find any reason to take a contrary view than taken in our above order passed in Revenue s appeal, i.e. ITA No.2408/Ahd/2009 for AY 2005-06. Hence, we decline to interfere in the orders of Ld. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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