TMI Blog2023 (2) TMI 688X X X X Extracts X X X X X X X X Extracts X X X X ..... ) had ignored the fact that the buildings B, C D were not completed as on 31.03.2012, which is the cut of date for claiming deduction u/s 80IB(10) - It is beyond anybody imagination as to how the Municipal Authority had issued completion certificate in respect of buildings B, C D even without knowing the fact that the construction was not completed as on 31.03.2012. No provision under the Municipal Corporation Act of Maharashtra Government was shown to us, which empowers the local authorities to issue completion certificate even without completion of construction of the entire building. CIT(A) had grossly fell in error in allowing the deduction in respect of buildings B, C D overlooking the plain provisions of the Act and without examining case in detail. Eligibility of deduction in respect of buildings E, F, G H - We are unable to discern that the ld. CIT(A) had satisfied himself that the respondent-assessee had fulfilled the necessary conditions precedent for availing the deduction u/s 80IB(10) of the Act. Therefore, we are of the considered opinion that the order of the ld. CIT(A) suffers from voice of perversity and it is bereft of factual discussion on facts of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompletion certificate for building B, C, D, E, F, G, H was granted by the Pune Municipal Corporation on 30.03.2012. However, on site visit at the relevant period of time revealed that building A was still not complete and buildings B, C, D were partly complete. 4. On the facts and circumstances of the case and in law, the Ld. CIT(A) has erred in not appreciating the fact that if the conditions set in section 80IB(10) are satisfied, then deduction is allowable on the entire project approved by the local authority and there is no question of allowing deduction to a part of the project. 5. The appellant prays to be allowed to add, amend, modify, rectify, delete or raise any grounds of appeal during the course of appellate proceedings. 3. Briefly, the facts of the case are that the respondent-assessee is an individual engaged in the business of constructions, builders and promoters of land. The Return of Income for the assessment year 2012-13 was filed on 30.09.2012 declaring total income of Rs.56,30,070/- and the same was revised on 01.02.2013 at total income of Rs.1,49,11,308/- after claiming exemption u/s 80IB(10) of the Income Tax Act, 1961 ( the Act ) of Rs.33, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he building A was not completed and the buildings B, C, E D were partly completed, however, proportionate deduction in respect of projects completed before 31.03.2012 was granted placing reliance on the decision of the Hon ble Madras High Court in the case of Viswas Promoters Pvt. Ltd. vs. CIT, 81 DTR 68 (Madras), the decision of the Hon ble Gujarat High Court in the case of CIT vs. B. M. And Brothers, 86 CCH 194 (Gujarat), the decision of the Coordinate Bench of this Tribunal in the case of Runwal Multi Housing Pvt. Ltd. vs. ACIT (ITA No.1015, 1016 1017/PUN/2011) and also the decision of the Hon ble Bombay High Court in the case of CIT vs. Brahma Associates, 333 ITR 289 (Bombay). The respondent-assessee also filed additional evidence i.e. copies of various agreements executed between the respondent-assessee and the purchasers of the flats. The ld. CIT(A) had called for the remand report from the Assessing Officer on the additional evidence filed by the respondent-assessee relating to the residential units allotted to sellers by the respondent-assessee under the provisions of clause (e) and (f) of section 80IB(10) of the Act. The ld. CIT(A) placing reliance on several decisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ficate as on 31.03.2012. Thus, he submits that the necessary conditions precedent for availing the deduction u/s 80IB(10) were not fulfilled and the ld. CIT(A) ought not to have directed the Assessing Officer to allow the deduction u/s 80IB(10), inasmuch as, without satisfying himself that the buildings were completed as on 31.03.2012, as well as without satisfying himself that necessary eligible conditions as prescribed under the said provisions of the Act stood satisfied. He further submits that the principle of proportionate basis cannot be applied in a case where the housing project had not satisfied the eligibility conditions prescribed under the said provisions of the Act. 9. On the other hand, ld. AR submits that the deduction was claimed only in respect of the eligible units sold and completed before 31.03.2012 placing reliance on the plethora of following decisions :- (i) CIT vs. Brahma Associates, 333 ITR 289 (Bom.-HC). (ii) Manjeera Projects vs. ACIT (ITA Nos.1554/Hyd/2018, 1599/Hyd/2019 and 15/Hyd/2020). (iii) Mahaveer Enterprises vs. PCIT (ITA No.920/Mum/2016). (iv) M/s Nagarjuna Homes vs. ITO (ITA No.722/Hyd/2009). (v) DCIT vs. M/s Om As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 1st day of April, 2004, on or before the 31st day of March, 2008; (ii) in a case where a housing project has been, or, is approved by the local authority on or after the 1st day of April, 2004 but not later than the 31st day of March, 2005, within four years from the end of the financial year in which the housing project is approved by the local authority; (iii) in a case where a housing project has been approved by the local authority on or after the 1st day of April, 2005, within five years from the end of the financial year in which the housing project is approved by the local authority. Explanation.-For the purposes of this clause,- (i) in a case where the approval in respect of the housing project is obtained more than once, such housing project shall be deemed to have been approved on the date on which the building plan of such housing project is first approved by the local authority; (ii) the date of completion of construction of the housing project shall be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority; (b) the project is on the size of a plot of land which h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... areas falling within 25 Kms. Of Municipal limits of these cities) and 1,500/- sq. ft. in other places. (d) The built up area of the shops and other commercial establishments included in the housing project should not exceed 5% of the total built up area of the housing project or 2,000 sq. ft. whichever is less. (e) The project has to be completed within four years from the end of the financial year in which the project is approved by the local authority. 13. In the present case, the respondent-assessee sought the approval of building plan, housing project and land admeasuring 25,340 sq.mtrs. to construct 8 buildings and the said approval was granted on 29.03.2007. The housing project was required to be completed on or before 31.03.2012 in order to avail the benefit of deduction u/s 80IB(10) of the Act. However, in the present case, admittedly, the position of the building A was totally incomplete as on 31.03.2012 and the buildings B, C D were completed partly upto floor no.9, 10 11 respectively, which clearly indicates that the housing project of buildings A, B, C and D were not completed upto 31.03.2012. It is the case of the respondent-assessee is that in r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the facts of the present case and on perusal of the assessment order as well as impugned order, we are unable to discern that the ld. CIT(A) had satisfied himself that the respondent-assessee had fulfilled the necessary conditions precedent for availing the deduction u/s 80IB(10) of the Act. Therefore, we are of the considered opinion that the order of the ld. CIT(A) suffers from voice of perversity and it is bereft of factual discussion on facts of the case and also failed to construe the provisions of relevant section in accordance with settled legal principles discussed above. Ordinarily, we would have remanded the matter back to the file of the Assessing Officer to examine the allowability of deduction u/s 80IB(10) in respect of buildings E, F, G H, but even before us the respondent-assessee had not led any material on record before us satisfying the conditions precedent for availing benefit u/s 80IB(10) in respect of buildings B, C D, therefore, keeping in view the well settled principle, that remand cannot be made in order to improve case of either party to the litigation. Accordingly, we decline to do so. Thus, the grounds of appeal filed by the Revenue stand allowed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
