M/s Sable Assocites, Pune V. Joint Commissioner of Income-Tax (OSD), Cen Cir 2(4), Pune

CO 34/PUN/2022

AI Insights

The case involves appeals by the Revenue against the decisions of the CIT(A) allowing deductions under section 80IB(10) of the Income Tax Act to M/s. Sable Associates for the assessment years 2009-10 and 2012-13. The primary contention of the Revenue was that the housing projects in question were not completed within the statutory time limits and that the projects should be considered as a single entity rather than separate projects. The Tribunal examined the facts, including the separate commencement and completion certificates for each project, and the legal precedents cited. The Tribunal found that each project was distinct and completed within the required time frames, thus entitling the assessee to the claimed deductions.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134439 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 1 month(s) 21 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 13-08-2023
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 17-05-2023
• Assessment Year: 2009-2010
• Appeal Filed On: 23-06-2022
• Other Referred Cases: Pr. CIT vs Abhisar Buildwell P. Ltd., Kewal Real Estate (P.) Ltd vs ITA Nos. 2028 & 2218/PN/2012, Vandana Properties, Rahul Construction Co. vs ITO, Aditya Developers vs DCIT, Parmar Properties Pvt Ltd vs DCIT, MudhitMadanlal Gupta vs ACIT, Western Outdoor Interactive (P.) Ltd vs CIT, Kores India Ltd vs CIT, Dilip Kumar & Co. vs CIT
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Document seized; Question of law; Competent authority; Block assessment; Documents seized; Set aside
• Section: 132; 143(3); 153A; 80IB; 139(1); 113; 13; 119; 22

Judgement Text

आयकर अपीलीय अिधकरण ”बी” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “B” :: PUNE BEFORE PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपीलसं. / IT(SS)A No’s.07& 08/PUN/2021 िनधाᭅरण वषᭅ / Assessment Years : 2009-10 & 2012-13 The Jt.Commissioner of Income Tax (OSD), Central Circle-2(4), Pune. V s M/s.Sable Associates, CTS No.2134, Adhishthan, Final Plot No.32B/24, Vijaynagar Colony, Sadashiv Peth,Pune – 411030. PAN: AAZFS 7254 F Appellant / Revenue Respondent /Assessee Cross Objection No’s.34 & 35/PUN/2022 (Arising out of IT(SS)A No’s: 07 & 08/PUN/2021) िनधाᭅरण वषᭅ / Assessment Years : 2009-10 & 2012-13 M/s.Sable Associates, CTS No.2134, Adhishthan, Final Plot No.32B/24, Vijaynagar Colony, Sadashiv Peth,Pune – 411030. PAN: AAZFS 7254 F V s The Jt.Commissioner of Income Tax (OSD), Central Circle-2(4), Pune. Appellant / Assessee Respondent / Revenue Assessee by Shri Nikhil S Pathak – AR Revenue by Shri Sardar Singh Meena – CIT-DR Dates of hearing 12/5/2023, 16/05/2023, 17/05/2023 & 18/05/2023 Date of pronouncement 14/08/2023 IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 2 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This appeal filed by the Revenue and Cross Appeal of Assessee are directed against the common order of ld.Commissioner of Income Tax (Appeal),[ld.CIT(A)], Pune-12 dated 31.05.2021 for A.Y.2009-10 and A.Y.2012-13emanating from separate assessment orders. Also, the assessee is before us as a Cross-Objector for the aforementioned year. 1.1 Since identical facts and similar issues are involved in A.Y.2009-10, A.Y.2012-13, AY.2013-4 & A.Y.2015-16, were heard together at the convenience and request of both the parties. Therefore, IT(SS)A No.07/PUN/2021for A.Y.2009-10 treated as a lead case. 2. The Revenue has raised the following grounds of appeal for A.Y.2009-10 : “1) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing assessee’s claim of deduction u/s.80IB(10) of the Act of Rs.1,74,48,655/- when the assessee had not completed the project by 31.03.2009 thus violating the provisions of section 80IB(10)(a)(ii) of the Act and also violated the condition mandated in clause (c) to section 80IB(10) of the Act. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 3 2) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in holding Shivsagar City and Shivsagar Residency as two distinct housing project without appreciating the fact that E building (Shivsagar Residency) is an extension of the earlier housing project (Shivsagar City) for which approval was granted on 06.07.2004 and also not considering that the revision /redesigning of the plan is one of the frequent occurrence of any project claiming deduction u/s. 80IB(10). 3) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in holding Shivsagar City ( containing buildings A,B,C and D) and Shivsagar Residency ( containing buildings E1-E5) as two distinct housing project and allowing the decutio u/s 80IB (10) without appreciating the findings of the Assessing Officer, based on documents obtained from Pune Municipal Corporation, wherein the note prepared by the Building Inspector and approved by the Assistant Engineer clearly states that E building (Shivsagar Residency) is an extension of / addition to the earlier single housing project (Shivsagar City). 4) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing the proportionate deduction u/s.80IB(10) of the Act even when the Ld.CIT(Appeals) had accepted that the assessee had violated mandatory condition of clause (c) to section 80IB(10) of the Act by combining two flat units into a single unit and exceeding the mandatory limits of 1500sq.ft. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 4 5) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing assessee’s claim of deduction u/s.80IB(10) when the assessee had violated the provisions of clause (f) to section 80IB(10) of the Act by resorting to sale of more than one unit to members of the same family. 6) Whether on the facts and the circumstances of the case, the Ld. CIT(A) was justified in not appreciating the fact that if the conditions set out 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 proportionate deduction to a part of the project? 7) Whether on the facts and the circumstances of the case, the Ld. CIT(A) was justified in not appreciating the fact that there is no provision for allowing proportionate deduction in section 80IB(10)? 8) Whether on the facts and the circumstances of the case, the Ld. CIT(A) erred in deleting the addition on account of rejection of deduction u/s 80 IB(10) on the grounds that it was not based on incriminating material found during the search without appreciating the clear finding of the AO in the order that disallowance of deduction was based on documents seized vide Bundle No. 1 from the office premises of the Adhisthan Building and that the combined reading of documents such as commencement certificates, occupation certificates and other documents related to the project constitutes incriminating evidence for disallowance of deduction u/s80IB(10). IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 5 9) Without prejudice to the fact that the disallowance of deduction u/s 80IB(10) was based on incriminating, Ld.CIT(A) erred in not appreciatingthe fact that as per section 153A (1) (b), the AO has power to assess or re-assess the total income in respect of six assessment years and not only the income based on incriminating material found during the search. 10) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in deleting the addition of Rs.5,00,000/- on account of facilitation/ commission income which was declared before Income tax Settlement Commission by the assessee holding that there was no incriminating documents without appreciating the fact that the incriminating materials are available with the department in form of diaries maintained by Shri.Sanjay Sable and Shri. Dilip Sable showing cash receipts which were explained and accepted by the assessee itself as receipts from Facilitation work / commission receipts. 11) The appellant craves leave to add, alter or amend any or all the grounds of appeal.” Additional Grounds of Appeal raised by the Revenue AY 2009-10 : “1. In the facts and circumstances of the case and in law the Ld. CIT(A] has erred in allowing the assessee' claim of deduction u/s 80IB(10) of the Act by ignoring and disregarding the fact that the assessee has failed to produce Completion certificate in respect of housing project from the local authority/competent authority as required by the statute under IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 6 provisions of Explanation to clause (a) of the section 80IB(10] of the Act within timelines prescribed in the said section. 2. In the facts and circumstances of the case and in law the Ld. CIT(A) has erred in allowing the assessee' claim of deduction u/s 80IB(10) of the Act by ignoring and disregarding the fact that the assessee has failed to even produce a copy application of Completion Certificate of housing project made before local authority in order to get Completion Certificate in respect of the housing project from the local authority as required under provisions of Explanation to clause [a] of section 80IB(10] of the Act within timelines prescribed in the said section. 3. The appellant craves, leave to add, amend, alter or delete any of the above additional grounds of appeal during the course of appellate proceedings before the Hon'ble Tribunal.” 3. In the Cross Objection Appeal, the Assessee has raised the following grounds of appeal for A.Y.2009-10 : “1. On the facts and circumstances of the case and in law, the learned CIT(Appeals) has erred in accepting the Revenue’s allegation that, in respect of two flats (namely Flat No. C- 2/503 and Flat No. C-2/504 in the housing project Phase-I Shivsagar City) the Assessee has breached the maximum area limit of 1500 sq. ft. prescribed under section 80-IB(10) of the Act by combining the said flats into a single unit whose combined area was 1770 sq. ft., without appreciating that there is a separate sale agreement for each flat and such flats are IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 7 separate even as per the completion certificate issued by the local authority.” 4. Brief facts of the case : 4.1) As per the Assessment Order for AY 2009-10 and CIT(A)’s order, the Sable Waghire Group is a Pune based group mainly engaged in the manufacture of bidis, food products etc. It has also expanded in the construction business through the assessee firm and other concerns. The assessee is a firm engaged in the business of Promoters & Builders. It has carried out projects such as Shivsagar City, Shivsagar Residency etc in the Sinhgad Road area of Pune. The firm is in existence since 15/01/2004. There are 9 partners in the firm and 8 of the partners are from the Sable family whereas the ninth partner is Shri Atul Mogal. In the search action u/s 132 of the I T Act at the office premises of the assessee firm cash of Rs.1,68,000/- and jewellery valued at Rs.4,25,154/- was found. Statements u/s 132(4) of the Income Tax Act of Shri Atul Vijay Mogal,Shri Sudhir S Sable were recorded during the search.In the post search proceedings statements of certain flat holders/customers of the assessee firm were recorded. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 8 4.2) The assessee firm filed original return of income for A.Y.2009-10 on 29/09/2009 with the ACIT, Cir-5, Pune disclosing income at ‘NIL’. The gross total income disclosed by the assessee firm was Rs.1,74,48,655/-. The assessee firm has claimed deduction under Chapter VIA of the Income Tax Act amounting to Rs.1,74,48,655/-. The case was selected for scrutiny and assessment order u/s.143(3) of the I T Act was passed on 30/11/2011 accepting the returned income at ‘Nil’, in the process allowing the claim of deduction u/s.80IB(10) of the Income Tax Act at Rs.1,74,48,655/-. Consequent to the search in the case of the assessee firm, the case was centralized with the Central Circle-2(4), Pune. A notice u/s.153A of the I T Act was issued to the assessee firm on 24/12/2014 for AY 2009-10. In response, the assessee filed a letter dated 24/04/2015 with a request to treat the original return filed u/s.139(1) of the Income Tax Act, on 29/09/2009 as return filed in response to notice dated 24/12/2014, issued u/s.153A of the I T Act. 4.3) In the meanwhile, the assessee firm filed an application u/s.245C(1) of the I T Act on 30/06/2016 before the Hon’ble Income Tax Settlement Commission, Mumbai for Assessment Years 2009-10 to 2015-16 offering additional income of IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 9 Rs.361.68 lakhs in aggregate for all the years. The additional income offered for AY 2009-10 was Rs 5.0 lakhs on account of Income from facilitation and Commission etc. The assessee firm paid the taxes on the additional income disclosed. The Income tax Settlement Commission Mumbai, vide Order dated 06/12/2017 passed u/s.245D(4) rejected the application of the assessee. As a result as per section 245HA of the Act the proceedings u/s 153A of the Act was restored. The Assessing Officer(AO) after giving opportunity to the assessee passed an order u/s.153A r.w.s 143(3) on 30/11/2018 denying the deduction u/s.80IB(10) of the Act to the assessee. The AO also made an addition of Rs.5,00,000/-. Submission of ld.Authorised Representative (ld.AR) : 5. The Ld.AR filed written submission which is reproduced as under : 1.2] The Assessee submits that it had purchased land at S. No. 17, at VadgaonBudruk, Taluka Haveli, Dist. Pune, admeasuring 68,900 sq. mts. (approx. 17 acres) on 12/04/2004. Thereafter, the Assessee obtained building plan permission on 06/07/2004 for 17 buildings namely, A1 - A9, B1 - B3, C1-C2 and D1-D3. The Assessee has treated these 17 buildings as Phase -I and has called them as Shivsagar City project. There are total 474 flats in these 17 buildings. The Assessee received completion certificate from PMC for these 17 buildings on 06/06/2007 and 16/07/2007. The relevant completion certificates are given on IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 10 pages 69 and 70 of the Paper Book - Vol. I. 1.3] The Assessee partly offered the income from these 17 buildings in AY 2008-09 and partly in AY 2009-10. The assessment for AY 2008-09 was completed u/s. 143(3) allowing the claim of the Assessee. Similarly, the assessment for AY 2009-10 was completed u/s. 143(3) accepting the claim of the Assessee. The copy of the assessment order for AY 2009-10 is enclosed on pages 117-119 of the Paper Book - Vol. I. 1.4] It is to be noted that subsequently, the Assessee received building plan permission for Phase-II comprising of 5 buildings E1-E5. The Assessee has considered these 5 buildings as Phase-II and called the same as Shivsagar Residency project. The building plan permission for these 5 buildings was first received on 26/03/2007. For AY 2009-10, the Assessee along with the return of income had filed audit report in Form 10CCB. The copy of the same is on pages 124- 128 of the Paper Book - Vol. I. In the said audit report, the Assessee had clearly stated that it is constructing two separate projects, Phase-I and Phase-II. On Page 126 of the Paper Book, the Assessee had pointed out that the commencement date for Phase I was 06/07/2004 and for Phase II was 26/03/2007. The Assessee had also clarified that Phase-I was completed and Phase-II was not complete. The point to be appreciated is that the Assessee had duly clarified in the audit report that it is constructing 2 separate projects, namely Phase-I and Phase-II, and the relevant building plans along with commencement certificates and the completion certificates were duly submitted by the Assessee. 1.5] In the course of assessment proceedings u/s. 153A for AY 2009-10, the Assessee had objected to the disallowance u/s. 80IB(10) on the ground that no incriminating document was seized in the course of Search and hence, no disallowance could be made in the assessment u/s. 153A. The Ld. AO has discussed this issue in Para (a) on Page 14 of the assessment order. The Ld. AO has stated that in the course of Search, certain documents were seized vide Bundle no. 1 from the IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 11 office premises of the assessee at Adhisthan building. He further states that the documents seized are in the form of commencement certificates, occupation certificates and other documents related to the projects in respect of which deduction u/s. 80IB(10) was claimed. The Ld. AO admits that none of these documents constitute incriminating document. However, according to him, the combined reading of the documents brings out the fact that the original commencement certificate and the subsequent commencement certificate being modifications cast a doubt on the claim made by the assessee. Accordingly, he has stated that the combined reading of the documents seized make the documents incriminating. 1.7] The Assessee submits that the disallowance made by the Ld. AO is not justified at all. At the outset, it is to be appreciated that the Ld. AO in Para (a), page 14, has stated that certain documents were seized in the course of Search. Firstly, the Ld AO gives a positive finding that none of the documents seized constitute incriminating material. The description of the various documents seized vide Bundle no. 1 is given on pages 120-123 of the Paper Book Vol-I. Basically, most of the documents are copies of Index-II in respect of the flats sold by the assessee and the other documents are in the form of commencement certificate and completion certificate which are already on record. Accordingly, none of these documents constitute incriminating evidence. It is to be also noted that the Ld AO in his order has proceeded to make a disallowance even without pointing out as to which document constitute incriminating evidence. In the absence of any such document being pointed out by the AO, the question of holding any incriminating evidence was found as a result of Search simply does not arise. 1.8] Further, the commencement certificates and completion certificates were already available with the erstwhile AO while conducting the original assessment proceedings u/s. 143(3) prior to the Search action. Thus, the fact that the assessee was developing the housing projects in phases, ie. Phase-I and Phase-II, and building plan approval for the Phase-II IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 12 mentioned ‘Revised’ on it, was already known to the Department at the time of conducting the original assessment proceedings. Accordingly, the contention of the AO in the assessment order passed u/s. 153A that on the subsequent commencement certificate ‘Revised’ is mentioned, was already known to the Department before the Search action and hence, there is no question of treating any of the documents seized as an incriminating evidence. 1.9] In the course of hearing, the Ld. CIT(DR) referred to the layout plan and NA order in order to support his case that incriminating documents were found. However, he has also accepted that these documents were gathered in the post Search enquiries and none of the documents were seized at the time of the Search. Accordingly, the Assesssee submits that the layout plan and the NA order do not form part of the Bundle No. 1 which was seized at the time of the Search action and thus, no incriminating document was seized. It is also to be appreciated that the Ld AO in the assessment order has not referred to any incriminating document and therefore there is no question of making any addition for AY 2009-10 for which the original assessment was completed prior to the Search action. The Assessee places reliance on the recent decision of the Hon’ble Supreme Court in the case of Pr. CIT vs Abhisar Buildwell P. Ltd. (Civil Appeal No. 6580 of 2021 and Others), please refer pages 255 to 313 of the Legal Compilation, in which the Hon’ble SC has said that in the case of non-abated assessments, no addition could be made in the absence of any incriminating evidence seized in the course of Search. Accordingly, the Assessee submits that in view of the principle laid down by the Hon'ble SC, the Ld CIT(A) has rightly deleted the disallowance made by the AO for AY 2009-10. 2.3] The relevant factual details of the two housing projects in respect of which deduction is claimed by the assessee u/s 80IB(10) are tabulated below: IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 13 Details of Housing Project Date of first Building Plan Approval Date of Completion Time limit for completion u/s. 80-IB(10)(a) Phase I - Shivsaear Citv 06/07/2004 06/06/2007 - Part On or before • 17 residential buildings vide completion for 418 31/03/2009 (A-l to A-9, B-l to B-3, C- Commencement flats - Completion (within 4 years 1 & C-2, D-l to D-3) Certificate No. Certificate No. from the end of • 474 flats • Area sanctioned: 24,929.42 sq. mts. • Proportionate land area exceeds 1 acre • Shivsagar City (Phase I) Co- op. Housing Society Ltd., registered on 03.04.2008 CC/1269/04 BCo/14/2/152 16/07/2007 - Completion for 56 flats - Completion Certificate No. B Co/14/2/227 the year in which approval was granted) Please refer pages 67 to 90 of Paper Book - Vol. 1for the above documentary evidences Phase II - Shivsaear 26/03/2007 21/11/2011 for all On or before Residency vide 175 flats vide 31/03/2012 • 5 residential buildings Commencement Completion (within 5 years (E-l to E-5) Certificate No. Certificate No. from the year in • 175 flats • Area sanctioned: 12,114.06 sq. mts. • Proportionate land area exceeds 1 acre • Shivsagar Residency Co-op. Housing Society Ltd., registered on 24.01.2012 CC/4563/06 OCC/0903/11 which approval granted) Please refer pages 91 to 106 of Paper Book - Vol. Ifor the above documentary evidences 2.4] The assessee would also like to state that each of the two housing projects (Phase I and Phase II) have separate entry and exit points. These projects are fenced by separate compound walls, are separated by a 9 meter-wide road between them and do not have any common amenities. Further, these housing projects were developed at different points in time and were marketed as standalone independent projects. The above stated facts are also evidenced from the following: - Brochures published by the Assessee firm in respect of each of these projects (Please refer pages 71 to 89 and 94 to 105 of IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 14 Paper Book - Vol. I) - Actual site photographs of these projects (Please refer pages 108 to 110 of Paper Book - Vol. I) - An online search for these projects on Google Maps (Please refer page 111 of Paper Book- Vol. I) - Agreement for sale executed with the flat buyers, wherein the name of the respective housing project is mentioned - Society registration certificates (Please refer pages 90 and 106 of Paper Book - Vol. I) 2.5] The Assessee submits that the disallowance made by the Ld. AO is not justified at all. Firstly, the Assessee will like to state that right from the beginning, it has claimed that it is constructing two different projects, namely Phase-I and Phase- II. The Assessee had claimed deduction u/s. 80IB(10) for Phase-I for the first time in AY 2008-09. The assessment was completed u/s. 143(3) and the claim made by the assessee was allowed. Now, the point to be appreciated is that the Search took place on 12/11/2014. The report of the Valuer is dated 24/02/2015. Accordingly, the point to be noted is that at the time of Search action as well as when the Valuer submitted his report, the time for reopening the case was available with the Department. However, the case for AY 2008-09 was not reopened and has attained finality. Now, once the claim of the assessee for AY 2008-09 has attained finality, it indicates that the Department has accepted that Phase-I and Phase- II constitute separate projects. Now, unless AY 2008-09 has been disturbed, the Ld AO does not get any jurisdiction to take a different stand in the subsequent years on the same issue. For this proposition, the Assessee places reliance on the decision of the Hon’ble Bombay High Court in the case of Western Outdoor Interactive (P.) Ltd. [2012] 25 taxmann.com 340 (Bombay HC) (please refer pages 226-229 of the Legal Compilation) wherein the Honble Bombay High Court has held in the context of section 10A that if the deduction has been allowed in year 1 and the same has not been disturbed, the deduction could not be disallowed in the subsequent years. The relevant para from the above decision of the Honble Bombay High Court is as under: IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 15 “6. We have considered the submissions. We find that the submissions made by Mr. Pardiwalla on the basis of the decision of this Court in the matter of Paul Brothers (supra) and Direct Information (P.) Ltd. (supra) merits acceptance. Therefore, in this case, it is not necessary for us to decide whether SEEPZ unit was set up/formed by splitting up of the first unit. In both the above decisions, this Court has held that where a benefit of deduction is available for a particular number of years on satisfaction of certain conditions under the provisions of the Income Tax Act, then unless relief granted for the first assessment year in which the claim was made and accepted is withdrawn or set aside, the Income Tax officer cannot withdraw the relief for subsequent years. More particularly so, when the revenue has not even suggested that there was any change in the facts warranting a different view for subsequent years. In this case for the assessment years 2000-01 and 2001-02 the relief granted under Section 10A of the Act to SEEPZ unit has not been withdrawn. There is no change in the facts which were in existence during the assessment year 2000-01 vis-a-vis the claim to exemption under section 10A of the Act. Therefore, it is not open to the department to deny the benefit of Section 10A for subsequent assessment years i.e. assessment years 2002-03 and 2003-04 and 2004- 05. Besides that, on consideration of the facts involved both the Commissioner of Income Tax (Appeals) and the Tribunal have recorded a finding of fact that the SEEPZ unit is not formed by splitting up of the first unit. ” 3.3] The assessee further places reliance on the decision in the case of Kewal Real Estate (P.) Ltd (ITA Nos. 2028 & 2218/PN/2012) (please refer pages 23 to 40 of the Legal Compilation). In that case, the assessee had undertaken construction of Phase-I and Phase-II. The commencement certificate for Phase-I was obtained on 02/02/2005 for 2 buildings. Subsequently, the assessee obtained revised commencement certificate in respect of Phase-II dated 08/09/2006 wherein there were certain changes even in respect of the buildings which were part of Phase-I. The Ld AO denied the deduction to the assessee on the ground that Phase-I and IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 16 Phase-II constituted one single project and since, Phase-II was not complete within the stipulated time period, the assessee was not entitled to claim deduction u/s 80IB(10). Hon’ble ITAT held that the contention of the AO is not correct. Simply because the subsequent approval by PMC was not a fresh approval but a revised approval did not mean that Phase-I and Phase-II constituted one single project. Hon’ble ITAT by placing reliance on the decision of the Hon’ble Bombay High Court in the case of Vandana Properties allowed the claim of the assessee. The Revenue challenged the said decision before the Hon’ble Bombay High Court and the order of Hon’ble ITAT has been approved by the Hon’ble Bombay High Court. It is also to be noted that Hon’ble Supreme Court has dismissed the SLP filed by the Department against the said High Court order (please refer pages 23-24 of the Legal Compilation). The assessee submits that even in the case of Kewal Real Estate (P.) Ltd the assessee had constructed Phase-I and Phase II and in the commencement certificate for Phase-II, it was mentioned as ‘revised’ and not ‘new’. However, it has been held that just because ‘revised’ is mentioned does not mean that the two projects constitute one single project. 3.4] Similarly, the assessee places reliance on the decision of Honble Bombay High Court in the case of Kores India Ltd [2020] 119 taxmann.com 281 {please refer pages 41-44 of the Legal Compilation) wherein initially the assessee had constructed 4 buildings and subsequently the assessee undertook development of Devpriya building. The deduction u/s 80IB(10) was denied on the ground that the construction of Devpriya building was an extension of existing 4 buildings. Hon’ble Bombay High Court has held that the building Devpriya was a separate project and simply because the local authority had imposed conditions in relation to building Devpriya as were originally imposed in case of earlier 4 residential buildings would not mean that the building Devpriya was an extension of the existing project. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 17 3.5] The assessee further places reliance on the decision of the Hon’ble Bombay High Court in the case of Prathamesh Constructions [2021] 133 taxmann.com 74 {please refer pages 177-180 of the Legal Compilation). In that case, the assessee had started housing project in 2001 comprising of buildings A to E, H and I and only the parking for building G was sanctioned. The assessee completed the construction of the said 7 buildings. Subsequently the plan was revised in 2011 and the assessee constructed building G. The Ld AO denied the claim on the ground that building G was part of the same project and since building G was not complete within the prescribed time limit. Hon’ble Bombay High Court has held that building G constituted a separate project for which building plan was approved subsequently. Even in that case, the subsequent plans were revision of the original plans. However, considering the principles laid down in the case of Vandana Properties, the deduction u/s 80IB(10) has been allowed by the Hon’ble Bombay High Court.” Submission of ld.Departmental Representative(ld.DR) : 6. The Ld.Commissioner of Income Tax (DR) filed written submission. The relevant part of it is reproduced as under : “As regards Completion Certificates are concerned, the appellant assessee was required to complete the entire project on or before 31.03.2009. The entire project can be termed as completed only after all the requirements as mentioned in the Commencement Certificate is completed including peripheral wall / fencing, roads and other amenities etc. However, the fact is that the entire project was not completed within the time lines as no such Completion Certificate was issued by PMC to the appellant. Certain buildings were completed and accordingly, the completion of buildings A 1-9, B 1-3, C 1-2 & D 1-3 was issued in 06.06.2007 & 16.07.2007. However, the other buildings i.e. E, F, G & Commercial Building were not completed as detailed in the Table-2 above. The Commencement Certificates for the said buildings were issued IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 18 vide Revised Commencement Certificates for construction in respect of the Revised Commencement Certificates for Development Plan issued vide letter dated 21.03.2007 and 16.04.2009 as mentioned in para 4.2 above. In view of above, the appellant's contention that the two Commencement Certificates dated 06.07.2004 and 26.03.2007 are for the two different projects and accordingly its claim that the project consisted of buildings El to E5 for which Completion Certificate received on 21.11.2011 was also completed in the stipulated time prescribed in section 801 B( 10) is not correct. The fact is that the Completion Certificate for the entire project was never issued. This fact is further substantiated with the communication of the appellant assessee with PMC. The appellant has written a letter dated 04.11.2015 to PMC in reply to PMC's letter cum notice dated 17.10.2015. A copy of this letter dated 04.11.2015 is enclosed as Annexure-12 to the factual paper book. The following facts are revealed from this letter: (i) Total land being Part & Parcel of non-agricultural land admeasuring about 8 acres, 8 gunthas (17/1+2+3+5+6+7+8) from Sudhir Sable, Dilip Sable, Arun Sable and Sanjay Sable (the owner of the land) agreed to entrust the development of the said property in favour of the appellant (Sable Associates) by development agreement and Power of Attorney dated 12.04.2004 which was registered on 13.04.2004 at Serial No. 2135, 2137, 2142 and 2140, respectively. (ii) Thereafter, the said property came within limits of PMC. Therefore, the Layout Plan was submitted to PMC for development and construction of building of residential, commercial purpose. (iii) N.A. permission was also obtained under N.A. Order No. PRH/NA/SR/146/2004 and that the said layout has been IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 19 sanctioned for various buildings which are to be developed or constructed in phase wise manner (para 2 of the letter). iv) The PMC has sanctioned layout of the building denoted in word 'H' in revised plan on 27.03.2007. v) That the scheme was launched for development of entire land which are amalgamated and common layout is sanctioned.” ...................... Brief synopsis on the arguments (based on written submission, factual paper book and legal compilation submitted on 23 Sep 2022) supporting the fact that the project at S. No. 17. Hissa No. 1+2+3+5+6+7+8 at VadgaonBudruk, Pune was one project only for which First Commencement Certificate was issued on 06.07.2004 and the project was not completed within stipulated time. 1. The appellant launched the scheme for development of the entire land at survey No. 17/1+2+3+5+6+7+8, VadgaonBudruk, Pune and common layout was got sanctioned. The plot area was 68900.33 sq.m. The project was one and in each layout the project was mentioned as "Proposed building layout on S. No. 17, Hissa No.1+2+3+5+6+7+8 at VadgaonBudruk. Pune”. The commencement of construction was started vide Commencement Certificate (Construction Division), PMC dated 06.07.2004 with reference to Commencement Certificate (Layout Division), PMC dated 28.04.2004. The other Commencement Certificate issued subsequently were revised certificates. 1.1 For the project layout plans (including revised plans) were sanctioned on three occasions by development section of PMC as under: IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 20 Sr. No. Date of commencement certificate (development plan) Departmental Paper Book page number for commencement certificate Departmental Paper Book page number for layout 1 28.04.2004 6 19 (reference) 2 21.03.2007 (revised-2) - 16 & 19 (reference) 3 16.04.2009 (revised-3) (Amalgamation + Proposed Building) 8, 10, 16 19 1.2 The commencement certificate issued by PMC (construction division) o- different occasions for the entire plot No. 17/1+2+3+5+6+7+8 on first occasion as new (i.e. VDB/0015/04 NEW) and further revised on different occasions as under: Sr. No. Date of commencement certificate (construction) Departmental Paper Book page number for commencement certificate Departmental Paper Book page number for layout Reference of Layout i.e. Commencement Certificate (Development Plan) 1 06.07.2004 (new) 20 21 28.04.2004 2 16.12.2004 (Extension - Club House) 22 24 3 21.09.2005 (Revised) 25 4 26.03.2007 (revised-2) 27, 29, 30, 33 and 34 38 21.03.2007 5 30.03.2007 (revised-3) 39, 40, 44 45 21.03.2007 6 30.03.2007 (revised-4) 46, 48, 52 53 21.03.2007 7 05.05.2009 (revised-5) 54, 57, 61 67 1.3 Letter dated 04.11.2015 from the appellant M/s. Sable IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 21 Associates to the Executive Engineer PMC, Pune [PBD (Departmental Paper Book) pages 68 to 73]: From this letter the following facts emerged: (i) That the scheme was launched for development of entire land which was amalgamated and common layout was sanctioned (PBD page 73). (ii) The plan was sanctioned under commencement certificate No. CC/1269/04 dated 06.07.2004 (PBD page 70). (iii) Revised layout was sanctioned in the year 2007 (PBD page 71). (iv) The PMC granted permission in revised plan vide CC0781/2009 dated 05.06.2009 (PBD page 71). 1.1 In view of above the AO was fully justified in holding that the project was a single project for the entire plot of land at S. No. 17/1+2+3+5+6+7+8. The First Commencement Certificate was issued on 06.07.2004 and accordingly the project was not completed within stipulated time and accordingly the project was not eligible for deduction u/s 801 B(10). 1.2 The Ld. CIT(A) has discussed this issue in para 7.1 to 7.25 of his order. He has failed to appreciate the facts of the case and has held that project was not one and there were three projects taken up on the said plot of land and accordingly he has held that the two projects were eligible for deduction. He has relied on certain case laws which are on different fact. Findings and Analysis : 7. We will decide the Ground Numbers8& 9 of the Revenue first which are legal grounds. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 22 7.1) Ld.CIT(A) had held that there was no incriminating material found during the search hence no addition can be made in the assessment for A.Y.2009-10 u/s.153A. Revenue has challenged this by Ground Number 8 & 9. 7.2) Basic facts of the case are repeated here again as under : A.Y.2009-10 Date of filling Original Return 29/09/2009 declaring NIL Income claiming deduction u/s 80IB(10) of Rs.1,74,48,655/- Date of Assessment Order u/s 143(3) 30/11/2011 allowing deduction u/s 80IB(10) Date of Search 12/11/2014 Date of Notice u/s.153A 24/12/2014 Date of Assessment Order u/s.143(3)r.w.s 153A 30/11/2018 7.3) From the above facts it is clear that department had accepted assessee’s claim of deduction u/s 80IB(10) in the original assessment order dated 30/11/2011 passed before the Search u/s 132 of the Act in the case of the assessee. It is also a fact that the AY 2009-10 was an unabated assessment year. 7.4) The Hon’ble Supreme Court has held in the case of Pr.CIT Vs. Abhisar Buildwell (P.) Ltd [2023] 454 ITR 212 (SC) [24-04- IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 23 2023] that no addition can be made u/s.153A in the absence of incriminating material in unabated assessment years. 7.5) Now since the law on this issue is very clear we need to understand whether there was any Incriminating material in the case of the assessee for A.Y. 2009-10. 8. The Assessing Officer in para 8a has held as under : “08. In the aforesaid factual background, the assessee was sent a show cause notice proposing to disallow the claim of deduction u/s 80IB(10) of the I T Act vide this office letter dated 31/10/2018. The assessee firm has filed a reply on 16/11/2018 wherein it has submitted its objections to the proposed disallowance of claim of deduction u/s 80IB(10) of the Income tax Act. The same are discussed hereunder : (a) The following issue raised by the assessee is addressed in the beginning though, the same is raised by the assessee firm at the end of the submission. It is the contention of the assessee that no incriminating material was found during the search proceedings and as such considering the settled position of law, the income returned u/s 153A of the I T Act should be accepted. In this regard, it is pertinent to note that certain documents were seized vide Bundle No 01 from the office premises of the assessee at Adhisthan Building. The documents seized constitute Commencement Certificates, Occupation Certificates and other documents related to the projects on which the claim of deduction is being made. Independently, none of these documents could constitute incriminating documents as all the projects are disclosed in the books of accounts of the assessee. However a combined reading of the documents bring out facts of the original commencement certificates issued on 06/07/2004 and subsequent commencement certificates being modifications to the originally granted project approval. It also cast doubts on IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 24 the claim of due date of completion in terms of the extant provisions on the date of approval. These characteristics arising from the combined reading of the documents seized u/s 132 of the I T Act, make the documents incriminating in nature. Before drawing a conclusion, reference is also made to the previous assessment orders passed in the case of the assessee firm, wherein the claim of deduction u/s 80IB(10) of the I T Act was allowed after going through part of the documents. It is clear from the complete set of documents that assessee’s claim that project was complete within the time allowed was not completely verified in the original assessment. Hence, the contention of the assessee firm, that no incriminating documents were seized at the time of search is not factual. Hence the same is rejected.” 8.1 The AO has categorically given the findings that there was no incriminating material. 8.2) The Ld.CIT(A) in para 8.8 and 8.9has held as under : “8.8 I have considered the facts of the case, It is seen from the audit report in Form No. 10CCB dated 15/09/2009 filed by the appellant for claiming deduction u/s 80-IB(10) of the Act for AY 2009-10 that the details of both the projects is mentioned in that report. As per the sub-clause (a) of the clause 23 of the audit report, wherein it requires the date of approval by local authorities and to attach copy of the approval of the building plan, the details of commencement certificates issued by the PMC for both the projects are given including that of the second project dated 26.3.2007. Further, as per the subclause (b) of the clause 23 of the audit report, wherein it requires the date of completion of the project and to attach copy of the completion certificate, the details of both the completion certificates issued by the PMC for the first project are given. The assessment for the year was completed by the AO under regular scrutiny vide order dated 30.11.2011 u/s 143(3) of the Act and no proceedings were pending for this year at the time of search. Therefore, it is a case of unabated assessment. It is IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 25 seen from the impugned assessment order that from the seized material, the AO has only taken adverse view for the word ‘Revised’ mentioned in the Commencement Certificate dated 26.3.2007 for the second project. However, the details of the same were already available with the AO while completing the assessment u/s 143(3) of the Act in the original proceedings. The AO has also not denied the same and stated that independently, none of these documents could constitute incriminating documents as all the projects are disclosed. However, it was contended by him that a combined reading of the above documents brings out the fact that the original commencement certificate is issued on 06.07.2004 and subsequent commencement certificates were only modifications to the originally granted project approval, and that this casts doubt on the due date of completion in terms of the extant provisions on the date of approval. Therefore, these characteristics arising from the combined reading of the aforesaid seized documents makes the documents incriminating in nature. However, this is nothing but another view taken by the AO on the same set of documents, which were already available with him before the search action. In view thereof, I agree with the appellant that; no incriminating material was found during the course of search relating to additions made by the AO in the impugned order for AY 2009-10. 8.9 In view of the above, since this is a case of unabated assessment, no addition can be made u/s 153A in the absence of incriminating material found in the course of search considering the ratio of the Hon’ble Apex Court in the case of Meeta Gutgutia (supra), Bombay High court in All Cargo Global Logistics Ltd (supra) and other decisions discussed above, which are squarely applicable to the case. Therefore, this legal ground raised by the appellant is hereby allowed.” 8.3 Thus, the ld.CIT(A) has given categorical findings that no incriminating documents were found during the search qua the A.Y. 2009-10. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 26 9. The Ld.DR pleaded that the report of the Govt Valuer appointed as part of post search inquiry was an incriminating material. However, we do not accept this contention of the Ld.DR. The incriminating material should have been found during the search. In this case Ld.DR relied on the valuation report which was obtained after the search. Hence, it is not an incriminating material found during the search. Also, the commencement certificate referred by Ld.DR were not incriminating material as these were submitted by the assessee during assessment proceedings. Ld.DR has filed copy of Return of Income for AY 2009-10 and copy of Form 10CCB filed by the assessee for AY 2009-10 along with the original return. On perusal of the Form 10CCB, it observed that the Assessee has categorically mentioned in coloumn number 8, 9& 23 that there are two phases, Phase I and Phase II of the project. ........................ IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 27  The Commencement date for Phase I was 15/01/2004  The Commencement date for Phase II was 26/03/2007  It is also mentioned that Phase II would be completed after December 2010. 9.1 Thus, all these facts are categorically mentioned in the Form 10CCB filed by the assessee with the original return of Income for A.Y.2009-10. It also mentions the Commencement Certificate numbers for these projects. 9.2 The incriminating material has to be in relation to any income not disclosed in the regular return filed by the assessee or any wrong claim made by the assessee. In the case under consideration there was no such incriminating material found IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 28 during the search. The Bundle Number 1 relied by the Ld.DR contains copies of Various Approvals issued by Pune Municipal Corporation in response to the various applications made by the assessee. The Bundle Number 1 also contains copies of Index-II of the registered agreement to sale entered with the various customers. The various approvals issued by the Pune Municipal Corporation does not constitute Incriminating material as these Approvals were duly submitted by the assessee during assessment proceedings. The copies of Index II also do not constitute Incriminating material as these Sales are duly reflected. Ld.DR has relied on the order of Hon’ble SC in the case of CIT Vs S.Ajit Kumar 404 ITR 526 to buttress the point that Valuer report is an incriminating material. However, the said decision of the Hon’ble Supreme Court is factually distinguishable as it is on Block Assessment u/s.158BB which uses the word “any such material or information available with the Assessing officer”. The present assessment is u/s.153A and it does not have the same words as in section 158BB i.e. Any such material available with the Assessing officer. Therefore, the case law relied by the Ld.DR is distinguishable and not applicable to present case. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 29 9.3 Therefore, we agree with the finding of the Ld.CIT(A) that there was no incriminating material found during the search qua AY 2009-10. Hence, respectfully following the decision of the Hon’ble Supreme Court in the case of Abhisar Buildwell (P.) Ltd.(supra), since the AY 2009-10 is an unabated assessment year and no incriminating material was found during the search, the AO cannot make any addition in the Assessment Order u/s.143 (3) r.w.s 153A for A.Y.2009-10. Accordingly, Ground No’s.8 & 9 of the Revenue are dismissed. Ground Numbers 1 to 3 and Additional Grounds of Revenue: 10. Revenue by Ground Numbers 1 to 3 has challenged allowability of the Assessee for deduction u/s 80IB(10) for the reason that the project was not completed before the statutory date . 10.1) In this case it is a fact that the Assessee had acquired development Rights for Land admeasuring approximately 69000 Sq. meters. The Assessee claimed that the Assessee has developed and constructed three different housing projects called as ‘Shiv-Sagar City (phase I)’, ‘Shivsagar residency (phase II)’, IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 30 ‘Shiv-sagar Platinum (phase III)’ on the said land admeasuring 69000 sq.m. The Ld.AR demonstrated that for each projects there are different ‘Building Plans Approval ’by Municipal Corporation. The Ld.AR submitted that the date for completion needs to be calculated from the date of the ‘Building Plan approval’. Ld.AR submitted that each project has received separate Completion certificate. There is separate compound wall for these projects. There are separate Housing Society for all these three projects. Therefore, the Ld.AR submitted that all these projects are independent housing project and hence eligible for deduction u/s.80IB(10) as each has received completion/ occupancy certificate within the statutory time limit. 10.2) On the other hand, Revenue has contended that all these three consist of one Housing Project as there is only one ‘Lay Out Plan’ sanction by the Pune Municipal Corporation. All the building plans refer to the said Lay Out Plan. Therefore, date of completion should be calculated from the First Approval i.e. Commencement Certificate dated 06/07/2004 CC/1269/04 and accordingly, the project should have been completed before 31/03/2009.According to the revenue the entire project was not IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 31 completed before the 31/03/2009, the assessee was not eligible for deduction u/s.80IB(10) of the Act. 10.3) The Income Tax Department had appointed Government Approved Valuer Mr.Nitin Lele. The Government Approved Valuer in his report dated 24/02/2015 has observed as under : IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 32 10.4) The Initial Lay Out Plan was as under : 10.5 Thus, the initial lay out plan shows only A1, A2, A3, A4, A5, A6, A7, A8, A9, B1, B2, B3, C1, C2, D1, D2 & D3. 10.6 The details of the Commencement Certificates issued by the Pune Municipal Corporation is discussed hereonwards. 10.6.1 CC/1269/04 dt.06/07/2004 as per the said Commencement certificate the Pune Municipal Corporation granted permission to start construction of Buildings A1, A2, A3, A4, A5, A6, A7, A8, A9, B1, B2, B3, C1, C2, D1, D2 & D3 consisting of 474 residential units. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 33 10.7 These 17 buildings had received the “part Occupancy certificates” on following dates.  Vide Part Occupancy certificate No.BCO/14/2/152 dated 6/6/2007, municipal corporation certified that Building No. A2,A3,A4,A5,A6,A7,A8,B1,B2,B3,C1,C2,D1,D2,D3 consisting of 418, residential premises, Parkings were completed.  Vide Part Occupancy Certificate No.BCO/14/2/227 dated 16/07/2007 Municipal Corporation certified that Buildings A1,A9, and its parking with 56 residential units were complete. 10.8 Thus, as per the Pune Municipal Corporation’s Part Occupancy Certificates the 474 residential units and parkings were duly completed on 06/05/2007 &16/07/2007. 10.9 The assessee formed a co-operative society for these 17 Buildings which was called as “Shiv Sagar City Phase I” and it was duly registered with the Registrar of Co-operative Society on 03/04/2008.(PB page 90) IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 34 10.10) The assessee has claimed that the project ‘Shiv Sagar City Phase 1’ is an independent project consisting of 17 buildings. It is a fact that the said 17 buildings were duly completed on 06/05/2007 &16/07/2007 as discussed in earlier paragraph. These 17 Buildings had received Commencement Certificate on 06/07/2004. The assessee has submitted copy of the Brochure of the ‘Shiv Sagar City’ which was used for marketing by the assessee. The Lay Out Plan appearing in the said Brochure is as under: IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 35 10.11) Thus, in the said brochure, the assessee has only shown A1 to A9, B1 to B3, D1 to D3, C1,C2 under the head, ‘Shiv Sagar City’. 11) The assessee submitted a revised Lay Out Plan to the Pune Municipal Corporation which was approved by Pune Municipal Corporation vide DPO10683/PLU-4/WK/19 dated 21/03/2007. 11.1 Vide Revised Lay Out Plan, the assessee added Building E1 to E5. In the revised Lay Out Plan assessee has also shown space for Proposed buildings. 12) Then Pune Municipal Corporation as per revised Lay Out Plan, issued Commencement Certificate No.CC/4563/06 dated IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 36 26/03/2007 for Construction of E1, E2, E3, E4 & E5. (paper book page 91,92).Page 91 of the paper book is the Drawing duly stamped by Corporation and page 92 is the Commencement Certificate. Both these documents have to be read together. There were 175 residential units. The Pune Municipal Corporations Letter categorically mentions that ‘E’ was added and approved on 26/03/2007.(page 27-33 of Department paper Book). 13) Vide Part Occupancy Certificate Number OCC/0903/11 dated 21/11/2011 the Pune Municipal Corporation certified that E1, E2, E3, E4 & E5 were complete and permitted to occupy. Thus, the E1, E2, E3, E4 & E5 received commencement certificate for starting construction on 26/03/2007 and were complete on 21/11/2011. The assessee has given the name ‘Shiv Sagar Residency’ to these E1, E2, E3, E4 & E5. The said ‘Shiv Sagar Residency’ was duly registered as Co-Operative Housing Society on 24/01/2012.(Certificate on page 106 of PB). The assessee has submitted copy of Brochure of the said ‘Shiv Sagar Residency’ which was used by the assessee for Marketing Purpose. In the said Brochure these E1, E2, E3, E4 & E5 have been shown as under : IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 37 14. The Assessee has separately marketed these E1, E2, E3, E4 & E5, which he called as ‘Shiv Sagar Residency’. The entire Brochure discuss only about E1, E2, E3, E4 & E5. The Location Plan appearing in the said Brochure is as under : IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 38 15) Assessee filed another revised plan which was approved vide CC/4903/06 dated 30/03/2007 permitting the assessee to construct F1, F2, F3 & F4. 16) The Assessee received Commencement Certificate Number CC/4901/06 dated 30/03/2007 for construction of ‘G’ Building. 17) We have elaborately narrated the factual position in the case of the Assessee in earlier paragraphs. In this factual background we have to decide now the eligibility of the assessee for deduction u/s.80IB(10) of the Act. 18) As per Section 80IB(10) explanation where the approval in respect of the housing project has been approved more than once such housing project shall be deemed to have been approved on the date on which building plan of such housing project is first approved by local authority. Thus, for the purpose of calculating date of limitation, the date of Building plan approval is most important. Nowhere in the section 80IB(10), there is any reference to date of approval of Lay Out Plan. Therefore, the Ld.DR’s contention that the date of first Lay out Plan approval shall be considered is devoid of any merit. Housing project has IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 39 not been defined in the Act but the Hon’ble Bombay High Court has held in the case of Vandana Properties that “Therefore, the expression 'housing project' in Section 80IB (10) would have to be construed as commonly understood”. 19. The ITAT Pune Bench, Pune in the case of Rahul Construction Co. Vs. ITO [2012]21 taxmann.com 435(Pune) has held as under : Quote, “2. The relevant facts emerging from the orders of the authorities below are that the assessee firm engaged in the business of promoters and builders had claimed deduction u/s. 80IB(10) of Rs. 4,42,18,673/-. The same was denied by the A.O mainly on that basis that out 16 buildings in the project in which one single approval and sanction was taken, only 11 buildings were complete within the prescribed time limit upto 31st March 2008. The A.O. stated that the first lay out plan in respect of entire complex was sanctioned by Pune Municipal Corporation (PMC) vide order No. DPO/45/D/646 dated 3.4. 2003 and the building plan was sanctioned vide commencement certificate No. 4269 dated 29.4.2003. The entire project sanctioned by these orders comprised of A, B, C & D type of buildings were subjected to amendments later. Referring Explanation below Sec. 80IB(10)(a) of the I.T. Act, the A.O held that as per the Explanation (i) when the approval in respect of the housing project was obtained more than once, the very first approval was the date to be taken for the approval of the project for the purpose of Sec. 80IB(10)(a) of the Act. The A.O. stated that in this case, the date of approval of the project was 3.4.2003, therefore, Sec. 80 IB(10) (a) required that the project should have been completed on or before 31st March 2008, which was not fulfilled by the assessee in respect of the entire project comprising of A to D, type of buildings. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 40 3. The contention of the assessee remained that the housing project consisted 16 buildings in a total area of 20 acres and 5 different lay out plans and accordingly different building plans were sanctioned from 3.4.2003 to 13.7.2003. Five buildings i.e. A1 to A 5 known as "Atul Nagar" were sanctioned as per amended lay out plans dated 27.6.2003, 3.10.2003 and 20th April 2004. Further, 6 buildings B1 to B 6 were constructed on the basis of lay out plans sanctioned on 15.9.2004 and 8.3.2006. It was stated that these 6 buildings known as "Rahul Nisarg Co-operative Housing Society Ltd." were separated by a wall from "Atul Nagar" and constituted a project by itself. It was submitted that different groups of building A & B should be treated different projects since these were constructed on plot of land which was more than 1 acre separately. The lay out plans were different for these 2 groups of buildings and these were completed well before 31 st March 2008. The A.O did not agree with these explanations of assessee. The Ld CIT(A) has also upheld the action of the A.O ............ 10. In view of above discussion, we come to the conclusion that for verification of eligibility of benefit claimed u/s. 80IB(10) of the Act by the assessee on buildings A1 to A5 in "Atul Nagar" and buildings B1 to B6 in "Rahul Nisarg Co-Operative Housing Society Ltd.", the assessing authority has to verify as to when the building plans for these buildings were firstly approved by the local authority and taking the said date of approval a starting point, he has to verify as to whether these buildings were completed within the prescribed time limit i.e. 31 st March 2008 on the basis of the Completion Certificate in respect of such housing project issued by the PMC. When we examine the facts of the present case under the above background, we find that the authorities below have not disputed the fact furnished in this regard by the assessee that under the project "Atul Nagar" consisting of buildings A1 to A5, the first building plan for A type was approved by the PMC on 29.4.2003 vide Commencement Certificate No. 4269 (page No. 4 of the paper book). However, actual construction of A type building was executed as per the revised plan vide No. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 41 C.C. 4101/27/6/2003 (PAGE No. 5 of the paper book). The size of the plot on which the A type building i.e. A1 to A6 have been constructed is 1,39,466 sq.ft. The project A type building i.e. A1 to A5 consists of 360 residential units and the construction has been completed between 10.1.2005 to 31.8.2005 (page Nos. 6 to 9 of paper book). The authorities below have also not disputed this material fact that residential units has a maximum built up area of 1500 sq.ft. Likewise, these material facts that B Group buildings in "Rahul Nisarg Co-operative Housing Society Ltd.," have been constructed on land area of 138203 sq.ft., has not been denied by the authorities below. They have also not denied these material facts that the first building plan was sanctioned on 29.4.2003 vide Commencement Certificate No. 4269 issued by the PMC (Page No. 16 of the Paper Book). The other material facts like actual construction was executed as per the revised plan sanction on 20th March 2004 vide CC No. 2225 (page No. 17), the project consists of 396 flats and construction of these flats have been completed on 14.7.2006 as per the Completion Certificate issued by the PMC (Page Nos. 13 to 18 of paper book) are not in dispute. The authorities below have also not denied that built up area of each of these flats does not exceed 1500 sq.ft. It is also not in dispute that both the projects are entirely a residential project and there is no commercial area therein. Under the above circumstances, we are of the view that the assessee is very much entitled to the claimed deduction u/s. 80 IB (10) of the Act on the buildings A1 to A5 in "Atul Nagar" and buildings B1 to B6 in "Rahul Nisarg Co-operative Housing Society Ltd." The issue is therefore decided in favour of the assessee. ” Unquote. 20. Similarly, ITAT Pune in the case of ACIT Vs. Kewal Real Estate Pvt. Ltd. ITA 2028 & 2218 /Pune /2012 vide order dated 21/09/2015 has held as under: Quote, “The undisputed facts as emerging from the records are, that the assessee had developed housing IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 42 project “Kumar Primavera” on Plot No. 69, Vadgaon Sheir, Pune measuring 24902.715 sq. mtrs. The assessee had obtained commencement certificate on 02-02-2005 in respect of two buildings, initially named as A6 and A7, which were subsequently, renamed as A1 and A2. Thereafter, the assessee obtained commencement certificate in respect of buildings A3 to A8 on 08-09- 2006. In all the assessee constructed 288 flats. In order to avail the benefit of deduction u/s. 80IB(10), the assessee was required to obtain completion certificate within 4 years from the end of financial year in which the housing project was approved by the local authority. Thus, in the present case, the last date for obtaining completion certificate was 31-03-2009. The assessee obtained completion certificate in respect of two buildings i.e. A1 and A2 on 05-09-2008. For the remaining six buildings i.e. A3 to A8 completion certificate was obtained on 31-03-2011. The assessee claimed deduction u/s. 80IB(10) in assessment years 2008-09 and 2009-10. During the assessment proceedings the Assessing Officer had deputed Registered Valuer to report about the status of project. The Registered Valuer vide his report dated 29-11-2010 inter alia observed that the completion certificate in respect of 80 flats is still pending. The Assessing Officer denied the benefit of deduction u/s. 80IB(10) on the ground that the assessee has not completed the project within the time frame as stipulated under the provisions of section 80IB(10) of the Act ............ 6. The contention of the assessee is that the buildings A1 and A2 are in Phase-I and buildings A3 to A8 are part of Phase-II of the project. The completion certificate in respect of Phase-I was obtained on 05-09-2008, well before last date on which the project should be completed i.e. 31-03-2009. As regards building A3 to A8 in Phase-II the completion certificate was obtained in March, 2011 and as per the provisions of Act, the last date for obtaining completion certificate was 31-03- IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 43 2012. The Revenue has strongly objected to the bifurcation of the project in Phase-I and Phase-II....... 11. The Mumbai Bench of the Tribunal in the case of MudhitMadanlal Gupta Vs. ACIT (supra) granted deduction u/s. 80IB(10) to the assessee, where the assessee had furnished completion certificate in respect of three wings of the project out of four. The Tribunal observed that the housing project does not necessarily have to be various group of buildings constructed on a particular land but it can also be a particular building or any building which is part of the large project....... 12. The Co-ordinate Bench of the Tribunal in the case of Rahul Construction Vs. ITO (supra) while dealing with a similar dispute has held as under:........... 13. Thus, from the facts of the case and the various decisions discussed above, we conclude that the assessee is eligible to claim deduction u/s. 80IB(10) on all the residential buildings comprising in Phase-I (A1 and A2) and Phase-II (A3 to A8). The date of completion of Phase-II shall be reckoned from the date of commencement certificate issued by PMC in respect of buildings A3 to A8. We do not find any infirmity in the order of Commissioner of Income Tax (Appeals), accordingly, the same is upheld and the appeals of the Department are dismissed.” Unquote. 20.1 The Income Tax department filed an Appeal against the said order of ITAT Pune in the case of Kewal Real Estate Pvt Ltd before the Hon’ble High Court. The Hon’ble High Court in [2020] 113 taxmann.com 623 upheld the order of the ITAT as under : IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 44 “2. The issues pertain to the assessment year 2008-09. Respondent - assessee is a Private Limited Company and engaged in the business of real estate development. In relation to residential units constructed by the assessee, it had claimed deduction under Section 80IB(10) of the Income Tax Act, 1961 ("the Act" for short). Assessing Officer denied the benefit on the premise that the housing project was not completed within the time permitted. The CIT(A) allowed the assessee's appeal upon which the Revenue filed appeal before the Tribunal. The Tribunal, by the impugned judgment, dismissed the Revenue's appeal and confirmed the decision of the CIT(A). The Tribunal made the following observations:— 9. It is evident from documents that originally the assessee sought approval of buildings A6 and A7, subsequently renamed as A1 and A2 on 2.2.2005. It was after the time lag of 18 months that the approval of other six residential buildings was obtained by the assessee on 8.9.2006 from PMC, while seeking initial approval there was no mention of other buildings. The observation of the Assessing Officer that the subsequent approval by PMC is not fresh approval but revised approval in our opinion does not carry weight. The building plan has been revised for buildings A1 and A2 only. As regards other buildings i.e A3 to A8 is concerned the building plan was approved for the first time. It is not disputed by the Revenue that buildings A1 and A2 in Phase-I were complete and occupation certificate was granted by the PMC in respect of said buildings on 5.9.2008. In so far as the buildings A3 to A8 in Phase-II are concerned, the completion certificate in respect of all the flats comprising in said buildings were granted by PMC up to March 2011, whereas, the last date for obtaining completion certificate was 31.03.2012. Thus, the assessee had obtained completion certificate well within the time frame mentioned in the provisions of IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 45 Section 80IB(10) of the Act in respect of all the buildings in Phase-I and Phase-II." From the above portion of the judgment of the Tribunal, it can be seen that the assessee had established on record that the buildings referred to as Complex A1 and A2 were part of separate project for which a separate approval was granted by the Municipal Corporation. Likewise, with respect to buildings Complex A3 to A8, building permission was granted by the Municipal Corporation separately. It was, in this background, that the CIT(A) and the Tribunal accepted two different dates of completion taking into account the respective dates of approval of the housing project. The entire issue is one of the facts. No question of law arises. The Income Tax Appeal is dismissed.” 21. The SLP filed by the department against the order of the Hon’ble High Court in the case of Kewal Real Estate P Ltd was dismissed by the Hon’ble Supreme Court vide order dated 02/08/2019 [2020]114 Taxmann.com576(SC). 22. The ITAT Pune in the case of DCIT Vs. Aditya Developers, ITA No.791/Pune/ 2008 has held as under : Quote, “7. There is no reason to dispute on facts in the present case that initially the proposed buildings ( except wings I, M, N, O, P and K in the present form) lay out plan was approved by the PMC on 25.5.1990 ( Page 94 of the paper book). The proposed building lay out plan was revised on 31.3.2001 (Page No. 5 of the paper book). The total area of land was 28905 sq. mtrs. The assessee had firstly completed development and construction of buildings A,B, C,D,E,F,G,H & J in the area of 17,392 sq. mtrs of project KKN, leaving the land area of 8966 IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 46 sq.mtrs vacant. In that vacant land, the assessee started the construction of buildings in wings K, M, N, I, O, P, K1 and K2 in the project “KKT”. In this project, 188 residential units were there each having built up area upto 1500 sq.ft. The building plans of the project “KKT” were approved on 9.3.2001 (wings K1 and K2) and 29.3.2001(wings I, M,N,O, P) which were completed on 10.10.2002 and 10.2.2003 respectively. Copy of building plan approved on 9.3.2001 has been made available at page No. 104 of the paper book, whereas the building plan approved on 29.3.2001 has been made available at page No. 103 of the paper book. There is no dispute on the dates of completion of the buildings in the housing project. The CBDT in its letter dated 4th May 2001 (page No. 110 of the paper book) has also made it clear that the definition of “housing project” is any project which has been approved by the local authority as a “housing project” should be considered adequate for purpose of Sec. 10(23 G) and 80 IB (10). We also find from the Explanation (i) to S. 801B(10) that the housing project and building plan of such housing project are two different concept. For a ready reference Explanation (i) to the Section is being reproduced hereunder : “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;” From the very reading of the Explanation (i) makes it clear that the date on which building plan of such housing project is approved shall be deemed the date of approval of the housing project. We thus find that the assessee is very much eligible for the claimed deduction u/s. 80 IB (10) on the project ‘KKT’ in view of the above cited decisions including decision of Pune Bench of the Tribunal in the case of Nirmiti Construction Vs. DCIT (Supra), following which, in our view, the Ld CIT(A) has rightly allowed the claimed deduction. The same is upheld. The issue raised are thus decided in favour of the assessee. ” Unquote IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 47 23) ITAT Pune in the case of Parmar Properties Pvt Ltd Vs. DCIT ITA 234/Pune/2009 had laid down the proposition that the Lay Out Plan is separate and distinct from the Commencement Certificate, for the purpose of 80IB(10) the date of Commencement certificate is to be considered and not date of Lay Out Plan. 24. In the case under consideration also, the Assessee has received separate Commencement Certificates for Building A1 to A9, B1 to B3, D1 to D3, C1,C2 which assessee has described as Shiv Sagar City Phase I and Shiv Sagar Residency consisting of building E1 to E5. The specific dates we have already mentioned in the earlier paragraphs. In these there are separate Society registrations. The Project Shiv Sagar City Phase I , Shiv Sagar Residency, were separately marketed by the assessee, both these projects had separate brochures as discussed in earlier paragraphs. Physically also they are separate as seen from the Lay out which is reproduced above. They are separated by road. Therefore, the proposition of law laid down by the decisions discussed above is that since housing project has not been defined in the Income tax Act section 80IB, it has to be understood in common parlance. The facts in the case of Kewal IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 48 Real Estate Pvt Ltd (supra) , Rahul Construction Co (supra), Aditya Developers (supra), Parmar Properties Pvt Ltd (supra), are identical to the facts of the assessee under consideration. Therefore, respectfully following the Judicial Precedence, it is held that the Shiv Sagar City Phase I, Shiv Sagar Residency, Shiv Sagar Platinum are different housing projects for the purpose of Section 80IB(10) of the Act. Accordingly, the date of limitation shall be calculated separately for each project as per the date of First Commencement certificate received by each project. There is no dispute on the fact that when the date of limitation is calculated separately for each project then the projects have been completed within the statutory time line. Hence, the Assessee is eligible for deduction u/s 80IB(10) for each project separately. 25. Ld.DR has raised the issue that Occupancy certificate is not same as Completion certificate of the project as mentioned in the Act. However, as discussed by us in earlier paragraphs, each project is a separate project. Each Project has received Occupancy Certificate which mentions that the buildings have been completed as per the plan. Therefore, we do not find any merit in the argument of the Ld.DR. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 49 25.1 Ld.DR has relied on the recent ITAT Pune decision in the case of Amit Enterprises Housing Ltd ITA 602/PUN/2020 order dated 09/03/2023,Hemraj Shankarlal Mundada in ITA No.1762/PUN/2018, P3 Properties ITA No.41/PUN/2020. All these cases are factually distinguishable. 25.2 In the case of Hemraj Shankarlal Mundada, it is an admitted position that Building B,C,D were not complete, also building A was not complete. In these facts the ITAT held that project was not complete. Therefore, this case is distinguishable on facts. 25.3 In the case of P3Properties, the ITAT has given a factual finding that the Housing Plan was originally sanctioned on 01/07/2003, hence it was required to be completed on 31/03/2008. Thus, this case is distinguishable on facts. 25.4 In the case of Amit Enterprises Housing Ltd, it was an admitted fact by the assessee that the 22 Bungalows were not complete which was part of this housing project. Therefore, the ITAT upheld the order of AO denying deduction u/s 80IB(10). Thus, even this case is distinguishable on facts. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 50 25.5 Thus none of the case relied by the Ld.DR have identical facts like the assessee under consideration. In non of these cases the assessee has brought to the notice of the ITAT the decision of Hon’ble Bombay High Court in the case of Kewal Real estate Pvt Ltd (supra), PCIT Vs. Kores India Ltd 119 taxmann.com 281 (Bom), hence the ITAT had no opportunity to analyze the facts on the touch stone of the law laid down by Hon’ble Jurisdictional High Court. Hence, none of the case laws relied by ld.DR are of any help to him. 25.6 Ld.DR also relied on the decision of the Hon’ble Supreme Court in the case of Dilip Kumar &Co. We most humbly agree with the proposition of law laid down by the Hon’ble Supreme Court in the case of Dilip Kumar &Co that exemption provision shall be strictly interpreted. However, this case law is of no help to the Ld.DR as the present case under consideration is about appreciation of facts and not about interpretation. 25.7 Therefore, for all the reasons discussed in earlier paragraphs, we are of the considered opinion that on the facts and circumstances of the case, the three projects are separate housing projects for the purpose of deduction u/s 80IB(10) of the IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 51 Act. For each project date of commencement shall be the date of First Commencement certificate issued by PMC for that particular project. It is observed that Shiv Sagar City Phase-I was received Commencement certificate on 06/07/2004 and it received the Occupancy Certificate on 06/06/2007, 16/07/2007, Shiv Sagar Residency received Commencement Certificate on 26/03/2007 and it received occupancy certificate on 21/11/2011, which were completed within the statutory time limit mentioned in the section 80IB(10) of the Act. Hence, the Project Shiv Sagar City Phase-I, Shiv Sagar Residency are eligible for deduction u/s.80IB(10) of the Act. Ground Number 4 of Revenue: 26. The AO has held that the assessee has violated condition mentioned in sub clause (c) of Section 80IB(10) i.e. area of residential unit was more than 1500 sq.ft. 27. The Income tax Department had appointed Government Valuerto examine this project. The Government Valuer in its report has categorically mentioned that no unit is more than 1500 sq.ft. In this fact and circumstances of the case, the findings of AO is erroneous and baseless. Hence, we hold that assessee has IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 52 not violated the condition mentioned in Section 80IB(10)(c). Accordingly, Ground Number 4 of the revenue is dismissed. Ground Number 5 of the Revenue: 28. The AO has alleged that the assessee has violated condition mentioned in sub clause (f) of Section 80IB(10). However, the subsection (f) of Section 80IB(10) was introduced w.e.f A.Y.2010-11, hence it is not applicable for AY 2009-10. Therefore, the Ground Number 5 of revenue is dismissed. Ground Number 10 of the Revenue: 29. This ground is about addition of Rs.5,00,000/- made by AO based on declaration of the Assessee. This addition is not based on any incriminating material found during the course of search. It is merely based on Assessee’s own admission which assessee subsequently withdrew. The revenue has not brought on record any evidence to prove that the said addition of the AO is based on any incriminating material. Rather in the Assessment Order also AO has not referred to any incriminating material. Therefore, respectfully following the Hon’ble Supreme Court decision in the case of Pr.CIT Vs. Abhisar Buildwell (P.) Ltd [2023] 454 ITR 212 (SC), it is held that the addition of IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 53 Rs.5,00,000/- which is made in absence of any incriminating material is not sustainable. Hence, Ground Number 10 of the revenue is dismissed. Ground Number 6&7: 30. This is about proportionate deduction allowed by Ld.CIT(A). For AY 2009-10, we have already held that the assessee is eligible for deduction u/s.80IB(10) of the Act. hence, this ground becomes academic in nature 30.1 Be it as it may be, this issue has already been decided by the Hon’ble jurisdictional High Court in the case of Model Construction Pvt. Ltd. Vs. DCIT 429 ITR 605(BOM)(26-11- 2020) in favour of Assessee. Hon’ble Bombay High Court had upheld the order of ld.CIT(A) granting prorata deduction. Therefore, respectfully following the Hon’ble Bombay High Court, the Ground Number 6 & 7 of the Revenue are dismissed. Ground Number 11 : 31. It is general in nature and does not need any adjudication, hence dismissed. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 54 32. In the result, the Appeal in IT(SS)A No.07/PUN/2021 for A.Y.2009-10 of the Revenue is dismissed. C.O.No.34/PUN/2022 for A.Y.2009-10 : 33. The Government Approved Valuer appointed by the Department has already certified in point number 4.2 that “Area of no flat is more than 1500 sq.ft.”. It has been alleged that Flat No.C2/503 and C2/504 were combined and combined area is more than 1500 sq.ft. However, the Government approved valuer had visited the project and then given the report which states that area of no flat is more than 1500 sq.ft. On perusal of the building plan, it is observed that the Flat No.C2/503 & C2/504 are independent units having area less than 1500 sq.ft. The Municipal Corporation in the occupancy certificate has not mentioned any deviation. It means that the Flat No.C2/503 & C2/504 were constructed with area less than 1500 sq.ft. There are two independent agreements. Therefore, there is no document on record to state that Flat No.C2/503 & C2/504 have been combined and its combined area is more than 1500 sq.ft. It is also observed that Flat No.C2/503 & C2/504 were sold in F.Y.2007-08 and the possessions were handed over on IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 55 06.06.2007. The entire revenue from sale of Flat No.C2/503 & C2/504 was recognized in A.Y. 2008-09. The Department in the assessment order for A.Y.2008-09passed under section 143(3) has allowed assessee’s claim for deduction under section 80IB(10) of the Act. In these facts and circumstances of the case, the assessee’s Cross Objection Appeal is Allowed. 34. In the result, Cross Objection appeal of the Assessee in C.O.No.34/PUN/2022 is Allowed. ****************** IT(SS)A No.08/PUN/2021 for A.Y.2012-13 : 35. The Revenue for A.Y.2012-13 has raised the following grounds of appeal : “1) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing assessee’s claim of deduction u/s.80IB(10) of the Act of Rs.40,27,73,851/- when the assessee had not completed the project by 31.03.2009 thus violating the provisions of section 80IB(10)(a)(ii) of the Act and also violated the condition mandated in clause (c) and clause (1) to section 80IB(10) of the Act. 2) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erredin holding Shivsagar City and Shivsagar Residency as two distinct housing project without appreciating the fact that E building (Shivsagar Residency) is an extension of the earlier housing project (Shivsagar City) for which approval was granted on 06.07.2004 and also not IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 56 considering that the revision / redesigning of the plan is one of the frequent occurrence of any project claiming deduction u/s. 80IB(10). 3) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in holding Shivsagar City ( containing buildings A,B,C and D) and Shivsagar Residency ( containing buildings E1-E5) as two distinct housing project and allowing the decutio u/s 80IB (10) without appreciating the findings of the Assessing Officer, based or documents obtained from Pune Municipal Corporation, wherein the not prepared by the Building Inspector and approved by the Assistant Engineer clearly states that E building (Shivsagar Residency) is anextension of / addition to the earlier single housing project (Shivsaj City). 4) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing the proportionate deduction u/s.80IB(10) of the Act even when the Ld.CIT(Appeals) had accepted that the assessee had violated mandatory condition of clause(c) to section 80IB(10) of the Act by combining two flat units into a single unit and exceeding the mandatory limits of 1500sq.ft. 5) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing assessee's claim etc u/s.80IB(10) when the assessee had violated the provisions of clause if to section 80IB(10) of the Act by resorting to sale of more than one unit to members of the same family. 6) Whether on the facts and the circumstances of the case, the Ld. CIT(A) was justified in not appreciating the fact that if the conditions set out 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 proportionate deduction to a part of the project? 7) Whether on the facts and the circumstances of the case, the Ld. CIT(A) was justified in not appreciating the fact that IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 57 there is no provision for allowing proportionate deduction in section 80IB(10)? 8) Whether on the facts and the circumstances of the case, the Ld. CIT(A) erred in deleting the addition on account of rejection of deduction u/s 80 IB(10) on the grounds that it was not based on incriminating material found during the search without appreciating the clear finding of the AO in the order that disallowance of deduction was based on documents seized vide Bundle No.l from the office premises of the Adhisthan Building and that the combined reading of documents such as commencement certificates, occupation certificates and other documents related to the project constitutes incriminating evidence for disallowance of deduction u/s 80IB(10). 9) Without prejudice to the fact that the disallowance of deduction u/s 80IB(10) was based on incriminating, Ld.CIT(A) erred in not appreciating the fact that as per section 153A (1) (b), the AO has power to assess or re-assess the total income in respect of six assessment years and not only the income based on incriminating material found during the search. 10) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in deleting the addition of Rs.5,00,000/- on account of facilitation/ commission income which was declared before Income tax Settlement Commission by the assessee holding that there was no incriminating documents without appreciating the fact that the incriminating materials are available with the department in form of diaries maintained by Shri.Sanjay Sable and Shri.Dilip Sable showing cash receipts which were explained and accepted by the assessee itself as receipts from Facilitation work / commission receipts.” Cross Objection No.35/PUN/2022 for A.Y.2012-13 : 36. The Assessee in Cross Objection appeal for A.Y.2012-13 has raised the following grounds of appeal : IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 58 “1. On the facts and circumstances of the case and in law, the learned CIT(Appeals) has erred in accepting the Revenue’s allegation that, in respect of two flats (namely Flat No.C-2/503 and Flat No.C-2/504 in the housing project Phase-I Shivsagar City) the Assessee has breached maximum area limit of 1500 sq. ft. prescribed undersection 80-IB(10) of the Act by combining the said flats into a single unit whose combined area was 1770 sq. ft., without appreciating that there is a separate sale agreement for each flat and such flats are separate even as per the completion certificate issued by the local authority.” Basic Facts for IT(SS)A No.08/PUN/2021 & C.O.No.35/PUN/2022 : 37. The assessee filed original return of income on 28.09.2012 disclosing total income at Rs.Nil and claiming deduction under section 80IB(10) OF Rs.40,27,73,851/-. The assessee claimed deduction under section 80IB(10) of the Act amounting to Rs.40,27,73,851/- during the A.Y. 2012-13. The assessee’s case was selected for scrutiny, however, the scrutiny proceedings got abated as search under section 132 of the Act was conducted in the case of assessee on 12.11.2014 before completion of assessment proceedings under section 143(3) of the Act. A notice under section 153A of the Act was issued to the assessee on 24.12.2014. In response to the same, assessee filed a letter dated 24.04.2015 requesting to treat the original return filed IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 59 under section 139(1) on 28.09.2012 as return filed in response to notice under section 153A of the Act. 38. For the Ground No.8 & 9 of the Revenue, the ld.DR accepted that these grounds are not applicable to the present case for A.Y.2012-13 and are not emanating from the order of the ld.CIT(A), hence, the ld.DR has not pressed for these grounds. The ld.AR and ld.DR made the same arguments as for the A.Y.2009-10. There was a common paper book and submissions for A.Y.2009-10 & 2012-13. Findings & Analysis : 39. Ground No. 1, 2, 3, 4, 6 & 7 are pertaining to eligibility of the assessee for deduction under section 80IB(10) of the Act. For A.Y.2009-10, we have elaborately discussed above, all the issues as raised the A.Y.2012-13. Accordingly, our findings in IT(SS)A No.07/PUN/2021, A.Y. 2009-10 above, would apply mutatis-mutandis for the current appeal in IT(SS)A No.08/PUN/2021 for A.Y.2012-13 for Ground No’s.1, 2, 3, 4, 6 & 7. Accordingly, the Ground No’s. 1, 2, 3, 4, 6 & 7 of the Revenue are dismissed. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 60 Ground No.5 of Revenue : 40. Ground No.5 is related to violation of Sub-clause(f) of section 80IB(10) of the Act. In the assessment order, the Assessing Officer(AO) has vaguely mentioned that there is violation of Sub-clause(f). The AO has vaguely mentioned that there are 31 instances of violation of Sub-clause(f). However, in the assessment order for A.Y. 2012-13, the AO has not mentioned the specific flat numbers and names of the purchasers and how they are related to each other. In the absence of basic facts, AO’s allegation has got no legs to stand. We have already mentioned that the municipal corporation has nowhere mentioned any violation of approved plans. As per approved plans, all the flats are less than 1500 sq.ft. The Department appointed valuer has also certified that all the flats are less than 1500 sq.ft. The sub-clause(f) of section 80IB(10) was introduced w.e.f. A.Y. 2010-11. However, the project Shivsagar City Phase-1 was completed on 16.07.2007. The project Shivsagar Residency was started on 26.03.2007 and completed on 21.11.2011. As we have already mentioned that AO has not specifically stated the Flat Numbers, the name of the project and names of the owners for alleged violation of Sub-clause(f) of IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 61 section 80IB(10), therefore, we do not find any merit in the allegation of the AO. Accordingly, Ground No.5 of the Revenue is dismissed. Ground No.10 for A.Y. 2012-13 : 41. The Ground No.10 is related to addition of Rs.5,00,000/- made by the AO on the basis of assessee’s application before Income Tax Settlement Commission. In the assessment order, other than referring to assessee’s admission made before Income Tax Settlement Commission, the Assessing Officer has not mentioned anything about the addition of Rs.5,00,000/-. The AO has not brought on record any document to demonstrate that assessee had earned Rs.5,00,000/- during the year and has not disclosed it. In the absence of any corroborative evidence, we agree with the ld.CIT(A) that impugned addition cannot be sustained. We agree with ld.CIT(A) regarding reliance on ITAT Mumbai decision in the case of Anantnadh Constructions and Farms (P.) Ltd. Vs. DCIT [2017] 166 ITD 83 (Mum) which has held as under: “19......................Therefore, just because assessee has offered additional income before Settlement Commission, no addition can be made without basis.” IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 62 41.1 Therefore, the AO is directed to delete the addition of Rs.5,00,000/-, accordingly, Ground No.10 of the Revenue is dismissed. 42 Ground No.11 is general in nature and does not need any adjudication, hence, the ground no.11 is dismissed. C.O.No.35/PUN/2022 for A.Y.2012-13 : 43. The assessee has raised the identical ground in Cross Objection for A.Y.2012-13 as for A.Y.2009-10. Since we have already decided the assessee’s Cross Objection appeal for A.Y.2009-10, our decision will apply mutatis mutandis to this apple also. Accordingly, grounds of appeal raised in the Cross Objection appeal for A.Y. 2012-13 is allowed. 44. In the result, Cross Objection appeal of the assessee is allowed. 44.1 To sum up, appeal of the Revenue in IT(SS)A No.08/PUN/2021 is dismissed and Cross Objection appeal of the Assessee in C.O.No.35/PUN/2022 is Allowed. IT(SS)A No’s.07 & 08/PUN/2021 & C.O.No’s.34 & 35/PUN/2022 M/s. Sable Associates 63 46. Finally, to sum up, two appeals of the Revenue in IT(SS)A No’s.07 &08/PUN/2021 for A.Y.2009-10 & A.Y.2012-13 are Dismissed and two Cross Objection appeal of the Assessee in C.O.No’s.34 & 35/PUN/2022 A.Y.2009-10 & A.Y.2012-13 are Allowed. Order pronounced in the open Court on 14 th August, 2023. Sd/- Sd/- (PARTHA SARATHI CHAUDHURY) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 14 th Aug, 2023/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकर अपीलीय अिधकरण, “बी” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकर अपीलीय अिधकरण, पुणे/ITAT, Pune.