TMI Blog2022 (9) TMI 1366X X X X Extracts X X X X X X X X Extracts X X X X ..... eted the disallowance taking into consideration the proceeding to assessment year that the claim of the assessee company u/s 80IB(10) was duly examined at the assessment stage and deduction was accordingly allowed except in respect of small proportionate amount for sale of multiple units to the same individual in alleged violation of the condition contained in section 80IB (10) (e) (f) introduced by the Finance Act 2009 w.e.f 01.04.2010. Observing the facts and circumstances of the case that the legal issue of clause (e) (f) is prospective in nature. Taking into consideration, the A.Y 2011-12, applicability of section 80IB(10) and clause (e) (f) held that the amendment introduced clauses (e) (f) and u/s 80IB(10) were prospective in nature. CIT(A) has placed judicial precedence concerning to different two places introduced from time to time in section 80IB(10), wherein the computing the tax for the A.Y 2013-14 did not consider the met credit available to the assessee and that in any addition is sustained and in respect of which further deduction u/s 80IB(10) of the Act is not allowed and based on the identical issue has already been examined by the ld. CIT(A) for the A.Y 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al:- 1. Whether on the facts and circumstances of the case and in law, the CIT(A) was justified in deleting the disallowance of deduction made 80IB of the I.T. Act not giving any independent finding but relying upon the decisions of the earlier assessment year? 2. Whether on the facts and circumstances of the case and in law, the CIT(A) was justified in deleting the disallowance of deduction u/s 80IB of the I.T. Act is justified on the ground that the provisions of clause (e) (f) of section 80IB(10) are not applicable to the flats booked prior to 01.04.2010, even if the sale of the said flats was made after 01.04.2010 (date of insertion of clause e f)? 3. The appellant craves the right to amend alter or add to any of the grounds of appeal given above. 3. The brief facts of the case are that during the course of assessment proceedings the Assessing Officer observed that as per l0CCB report the housing project was completed on 30.06.2010 but in the profit loss account work-in-progress was appearing and thus wrong information was submitted by the assessee with regard to completion of project. The Assessing Officer further observed that the assessee has viol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... st expenditure - Nil (iii) % of average investment {( Rs. 4,99,200/-+Rs. 52999200/- )/2}=133746/- Total disallowance u/s 14A=A+B+C=133746/- Considering the above, the total income is computed as under:- Returned income Rs. 47,14,737/- Add: 1. Disallowance of 80IB Rs. 1,54,98,395/- 2. Undisclosed Sale Rs. 14,47,70,242/- 3. Under value sale Rs. 2,09,37,049/- 4. Disallowance u/s 14A Rs. 1,33,746/- Assessed income Rs. 18,60,54,169/- Assessed income (Rounded off) Rs. 18,60,54,170/- Assessed u/s 143(3) of the Income Tax Act, as above. Issue copy of order, demand notice of the Income Tax Act, 1961 to the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - a) The assessee company is engaged in the business of Real Estate Development . It developed one residential housing project under the name style of Royal Greens which had following two phases: Phase I It consisted of 450 residential units and 6 shops. This phase I was eligible for deduction u/s 80IB(10). The project was completed on 30.06.2010. Phase II Phase II of the Royal Greens project was not eligible for deduction u/s 80IB(10). The said phase II was under construction during the previous year relevant to A.Y. 2013-14. None of the units of phase II (ineligible project) were sold during A.Y. 2013-14. b) in the preceding two assessment years the claim of the assessee company under section 80IB(10) was duly examined at the assessment stage and deduction was accordingly allowed except in respect of small proportionate amount for sale of multiple units to the same individual in alleged violation of the condition contained in section 80IB(10)(e) (f) introduced by Finance Act, 2009 w.e.f. 01.04.2010. However this disallowance in both the years, was also deleted by the ld. CIT(A). c) The summarized history in terms of deduction eligibility u/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CIT v Anriya Project Management Services (P.) Ltd. [2012] taxmann.com 140 Karnataka 14 3. CIT V G.R. Developers [2012] 22 Taxmann.Com 265 Karnataka 14 4. Manan Corpn. V ACIT [2013] 29 taxmann.com 15 () Gujrat 14 5. CIT v Jain Housing Constructions Ltd. [2013] 30 taxmann.com 131 Madras 14 6. CIT v Jogani Constructions Ltd. [2013] 35 taxmann.com 9 Bombay 15 7 CIT v CHD Developers Ltd. [2014] 43 taxmann.com 249 Delhi 15 8. CIT v Ittina Properties (P.) ltd. Karnataka 16 9. CIT v Happy Home Entreprises (2014) 51 taxmann.com Bombay 16 ITAT : Sr. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly. Phase I having been completed on 01.10.2010. 5. The condition of completion of eligible Phase I was examined in preceding two assessment years i.e. A.Y. 2010-11 A.Y. 2011-12. Deduction in these two assessment years stood allowed by the Id. AOs vide orders u/s 143(3) (PB 1-3 and PB 4-7). 6. Once the eligibility conditions are examined in the first year of eligibility, when the benefit is allowed over a period, the same cannot be negated in the subsequent years by the Department. Reliance is placed on the following judicial precedents Supreme Court: Sr. No. Case law 1. Shasun Chemecals Drugs Ltd. vs. CIT (2016) 388 ITR 1 (SC) High Court: Sr. No. Case law HC 1 CIT vs Malborough Polychem (P.) Ltd. [2009] 309 ITR 43 (Raj) Rajasthan 2 Cit vs Western Outdoor Interactive (P.) Ltd. [2012] 349 ITR 309 (bom) Bombay 3. Saurashtra Cement Che ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llotted to an individual, no more residential unit could be allotted to its spouse, minor children and HUF. The ld. Sr. DR fully relied and uphold the orders passed during the assessment proceedings by the Assessing Officer. He is legally and effectively and correct and the disallowance is made according to the amendments and the ld. DR submitted that the decision of ld. CIT(A) is not acceptable and the issue of allowance of deduction u/s 80IB is not with the facts and legally correct. Further ld. Sr. DR submitted that the ld. CIT(A) relied on the decision of the issues where the assessee s own case in the A.Ys 2011-12 2012-13 wherein it was held that the provisions of sub clause (e) and (f) prospective in respect of flat booked or after on 01.04.2009. The arguments placed by the ld. Sr. DR before us that as per the completion of certificate of project. The project was completed on 30.06.2010. Therefore, any sell made in assessment year 2013-14 cannot be accepted to be made for the booking before the completion of the project if the booking had been made prior to the completion of project. The same should have converted into sell in the year when the project is completed but in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umstances of the case that the legal issue of clause (e) (f) is prospective in nature. Taking into consideration, the A.Y 2011-12, applicability of section 80IB(10) and clause (e) (f) held that the amendment introduced clauses (e) (f) and u/s 80IB(10) were prospective in nature. 12. The ld. CIT(A) has placed judicial precedence concerning to different two places introduced from time to time in section 80IB(10), wherein the computing the tax for the A.Y 2013-14 did not consider the met credit available to the assessee and that in any addition is sustained and in respect of which further deduction u/s 80IB(10) of the Act is not allowed and based on the identical issue has already been examined by the ld. CIT(A) for the A.Y 2012-13 wherein the issue has also been decided in favour of the assessee. Considering the legal issues, the ld. AR for the assessee has placed reliance on various Supreme Court, High Courts and Co-ordinate Benches which specifically held that clause (e) (f) of the Act introduced in section 80IB(10) of the Act by Finance Act w.e.f 01.04.2010 were prospective in application. 13. 2nd issue relating to completion of project whether belongs to Phase-01 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ns in this year and has accepted the disallowances. The ld. DR argued that the similar circumstances is required to be checked whether that exceed or not and since the issue has not been seen in that light and the ld. CIT(A) as merely followed the order without going into the merits of the facts that the assessee herself accepted the disallowances in past. Therefore, in light of the argument advanced by the ld. DR, we are of the view that looking to the facts before us that the assessee has incurred expenditure after the project is completed whether the terms and conditions as required U/s 80IB of the I. T. Act is property fulfilled by the assessee or not is required to be checked. The ld. Assessing Officer in the light of the facts and circumstances of the advanced by the ld. DR before us and looking to the interest of justice. The ld. AO is required to check afresh about the admisibilty of the deduction claimed by the assessee u/s 80IB of the Act. We do not give any direction as to the availability of the claim the Assessing Officer is directed to apply afresh his mind looking to the various aspect argued by the ld. DR with that direction the appeal of the Revenue is partly allow ..... X X X X Extracts X X X X X X X X Extracts X X X X
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