TMI Blog2018 (1) TMI 1646X X X X Extracts X X X X X X X X Extracts X X X X ..... of two flats, all other conditions of section 80IB(10) of the Act are fulfilled in respect of the housing project which is evident from the fact that there is no other allegation made by the AO. In our view, for violation of conditions of clause (f) of section 80IB(10) of the Act in respect of two flats, the deduction for the entire housing project or in respect of other flats which otherwise are complying to the conditions of section 80IB(10) cannot be disallowed. The disallowance, if any, has to be restricted to the flats which violate the conditions of section 80IB(10). The Hon'ble Jurisdictional High Court in CIT v/s Bramha Associates [ 2011 (2) TMI 373 - BOMBAY HIGH COURT] has held that deduction under section 80IB(10) can be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bonafide reasons. Hence, we are inclined to condone the delay and admit the appeal for hearing on merits. 3. The solitary issue arising for consideration in this appeal relates to disallowance of deduction claimed under section 80IB(10) of the Act in respect of housing project. 4. Brief facts are, the assessee a company is engaged in the business of construction and development of housing projects. For the impugned assessment year, the assessee filed its return of income on 30th September 2011, declaring nil income under the normal provisions after claiming deduction under section 80IB(10) of the Act in respect of slum rehabilitation project development at Vile Parle known as Ajinkya Durga. Of course, the assessee also offered book pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d three flats to him in SRA project. The Assessing Officer referring to clause (e) and (f) of section 80IB(10) of the Act observed, if more than one residential unit in a housing project is allotted to one individual no deduction under section 80IB(10) of the Act is allowable. Accordingly, he called upon the assessee to explain why deduction claimed under section 80IB(10) should not be disallowed. In response, it was submitted by the assessee, even if conditions of section 80IB(10) of the Act are not complied with in respect of some flats, however, the project would still qualify for deduction under section 80IB(10) of the Act and deduction under the said provision can be allowed on proportionate basis in respect of flats which complied to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oportionate disallowance can made in respect of flats which do not fulfill the conditions of section 80IB(10) of the Act. In this context, he relied upon the following decisions: i) Biswas Promotors Pvt. Ltd. v/s ACIT, [2013] 214 taxman 524; ii) CIT v/s Arun Exelo Foundation Pvt. Ltd., [201₹ 3] 212 taxman 342 (Mad.); iii) ITO v/s Paras Builders, 69 SOT 82; 7. Learned Departmental Representative relied upon the observations of the Assessing Officer and the learned Commissioner (Appeals). 8. We have heard rival contentions and perused the material available on record. As could be seen from the facts available on record, the assessee has developed a housing project under the slum rehabilitation scheme of the Government. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be construed liberally. Undisputedly, except violation of conditions of clause (f) of section 80IB(10) of the Act in respect of two flats, all other conditions of section 80IB(10) of the Act are fulfilled in respect of the housing project which is evident from the fact that there is no other allegation made by the Assessing Officer. Therefore, in our view, for violation of conditions of clause (f) of section 80IB(10) of the Act in respect of two flats, the deduction for the entire housing project or in respect of other flats which otherwise are complying to the conditions of section 80IB(10) cannot be disallowed. The disallowance, if any, has to be restricted to the flats which violate the conditions of section 80IB(10). The Hon'ble J ..... X X X X Extracts X X X X X X X X Extracts X X X X
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