TMI Blog2018 (12) TMI 1823X X X X Extracts X X X X X X X X Extracts X X X X ..... its order dated 3rd November, 2016 has based on the Occupation and the Building completion certificates -accepted that the construction of the project was completed within the time as required by section 80-IB(10)(a)(iii). Once this factual position is accepted, then, a different view cannot be taken on the completion of the project for a later year. If this proposition is accepted, then, one is not required to go into the other propositions. As per Explanation below clause (a) of section 80-IB( 10), the date of completion of construction of the housing project shall be taken to be the date on which completion certificate in respect of such housing project is issued by the local authority. Therefore, according to the legislature, it is incumbent on the AO to regard the construction of the project being completed based on completion certificates issued by the local authority. There is no option which has been given to the Assessing Officer to go beyond the said certificate and express his dissent with the said certificate. No infirmity in the order of CIT(A) for allowing claim of deduction u/s.80IB (10) - Decided against revenue. - ITA No.3251/Mum/2017 - - - Dated:- 5-12-2018 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... again made the claim for deduction u/s.80IB(10). Subsequently, the case was selected for scrutiny under CASS and notices u/s.143(2) and 142(1) were duly issued and served on the assessee. The assessee has claimed deduction to the tune of ₹ 6,03,35,750/- u/s.80IB(10) on the project 'Mayuresh Residency'. The AO conducted enquiry u/s.131 on 10.4.2013 which revealed that the project was not completed as there were still some scaffoldings at the entrance. The 'D' 'E' wings were still incomplete, The AO had made photographs of the project as part of the order. It was the assessee's contention that it was only repair and beautification which was being done and not the construction of the project. This housing project was first approved by BMC on 10.09.2007 and according to section 80IB(10)(a)(iii) r.w.Expl.(i) to clause(a), the deduction is available if the project is completed within 5 years from the end of the financial year in which the project was first approved. Therefore, the project had to be completed by 31.3.2013. The assessee has obtained completion certification dated 18.3.2013 from the MCGM which was submitted before the AO. However, the AO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, the assessee want in appeal to the CIT(A). The CIT(A) allowed the claim of deduction on the issue of allotment of flats by observing that the assessee has not allotted more than one residential unit to any individual or to spouse or minor children of any individual to whom any other residential unit is already allotted. Therefore, the said conditions are not contravened by the assessee. But CIT(A) confirmed the disallowance of deduction u/s.80IB on the ground that the project was not completed before the limitation date which is 31.3.2013. As already discussed above, the project was approved on 10.09.2007 i.e. in the F.Y.2007-08 and had to be completed within 5 years from the end of the relevant year in which the approval was taken i.e. before 31.3.2013. The CIT(A) stating that the assessee was unable to produce the completion/occupation certification, confirmed the disallowance of deduction u/s.80IB(10). 6. Against the above order, AO disallowing assessee s claim of deduction u/s.80IB (10). Assessee approached to the CIT(A) and the CIT(A) after following the decision of the Tribunal in assessee s own case for the A.Y.2010-11 and 2011-12 allowed assessee s claim of deducti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was very specifically stated that the claim was withdraw out of fear of penalty. Thereafter, the assessee has second time revised the return of income and in the latter dated 23rd April, 2014 the assessee has clarified as to why it has now again filed the revised return claiming the deduction. 13. Learned AR relied on the decision of Karnataka High Court in case of Tejas Networks Ltd., (233 Taxman 426) in support of the proposition that certificate issued of competent authority u/s.35(2AB) i.e., by Department of Scientific and Industrial Research, approving assessee s claim should be accepted and AO could not deny the same. In the instant case, learned AR argued that the competent authority has already inspected and approved the project as having been completed well within the due date, accordingly, AO has no right to go beyond the certificate issued by the competent authority. 14. Reliance was also placed on the decision of Hon ble Supreme Court in case of Chunni Lal Prashadi Lal (AIR 1986 SC 1966) wherein it was held that genuineness of certificate and declaration may be examined by the Taxing authorities but not the correctness or the truthfulness of the statements. Accor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecutive Engineer to the AO. We have also carefully gone through the statement on oath dated 17/03/2015 recorded u/s.131 of the Act of Executive Engineer by the AO. We had also verified the certificate issued in form 10CC (13) with regard to assessee s claim of deduction. All these documentary evidences clearly proves the case of the assessee with regard to completion of the project. 19. The issues which arise for consideration of this Tribunal in the present case are as stated hereafter: a) Whether, in view of the Tribunal's order dated 3rd November, 2016 for A.Ys. 2010-11 and 2011-12, where it has been accepted that construction of the Mayuresh Residency Project was completed before 31st March, 2013, it is open to any authority including the Tribunal to take a different view. b) Whether, the Assessing Officer was justified in holding that the project was incomplete as on 31st March, 2013, despite the fact that the Municipal Corporation of Greater Mumbai (MCGM) being the local authority has issued Occupation certificates on 26* February, 2013 and 4th March, 2013 and the Building completion certificates on 18th March, 2013. c) If it was open to the Assessing Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ions, the Assessee had claimed deduction under the said section. Such deduction was also claimed for A.Ys. 2010-11 and 2011-12. One of the reasons for which the said deduction was denied by the CIT(A) for those years was that the said housing project was not completed before 31st March, 2013. Upon Assessee's appeal before the Tribunal for those years, considering the Occupation certificates and the Building completion certificates issued by the MCGM, the Tribunal accepted the its plea that construction of the said project stood completed before the specified date and, hence, the assessee was entitled to the deduction. Since, this fundamental fact i.e., completion of construction of the housing project before 31st March, 2013 (which the Assessee submits cannot change from year to year) has been accepted by the Tribunal in its appellate order for the A.Ys. 2010-11 and 2011-12, the said issue ought to be decided in the Assessee's favour without any further deliberation. 23. A bare perusal of the assessment order dated 17th March, 2015 passed by the Assessing Officer for the A.Y. 2012-13 shows that for .denying the Assessee's claim of deduction based on non-fulfilment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re in the Building completion certificates issued on 18th March, 2013. That Occupation certificate in respect of Blocks A, B and C of the said housing project was issued on 26th February, 2013. Similar certificates for Blocks D and E and Bank as well as the Club House were separately issued on 4th March, 2013. From the record we found that occupation certificate was issued by the MCGM only after verifying the fact that construction of the project is completed and is in accordance with the conditions in the IOD as approved from time to time. The said Occupation certificates which have been issued by MCGM after thorough verification have no such qualification. After obtaining the Occupation certificate, the only further condition required to be fulfilled to apply for the Building completion certificate is the obtaining of water connection. 27. Statement on Oath of the Executive Engineer in the office of MCGM was taken by the Assessing Officer on 17th March, 2015. In response to Questions 6 and 7, he has specifically stated that Occupation certificate is granted only on compliance of the IOD conditions. Further, before granting of the Occupation certificate onsite verification is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of MCGM has clarified that the Occupation certificates and the Building completion certificates have been issued in the present case, after following the necessary procedure and in accordance with law. 31. From the record we found that the Occupation and the Building completion certificates have been issued in the present case by the MCGM after thorough application of mind and following the prescribed procedure. There is absolutely no basis for the observation that the said certificates have been issued in a casual manner. On the contrary, the assertions as made by the Assessing Officer with respect to the construction of the said project being incomplete based on the photographs taken on 10th April, 2013 has no basis. The fact relating to completion of the housing project is a fundamental one and such which cannot change based on year to year. In the present case, for A.Ys. 2010-11 and 2011-12 the Tribunal by its order dated 3rd November, 2016 has based on the Occupation and the Building completion certificates -accepted that the construction of the project was completed within the time as required by section 80-IB(10)(a)(iii) of the Act. Once this factual position is accepted ..... 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