Dy. CIT, Circle - 5(1), Hyderabad V. Sahara States- Hyderabad, Hyderabad

CO 4/HYD/2012

• Counselvise Citation: [2015] 123 COUNSELVISE.COM (IT) 0987 (ITAT-HYDERABAD)
• Duration Of Justice: 3 year(s) 4 month(s) 9 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 17-06-2015
• Appeal Filed By: Assessee
• Bench Allotted: A
• Next Hearing Date: 15-06-2015
• Assessment Year: 2005-2006
• Appeal Filed On: 07-02-2012
• Court: TRIBUNAL
• Department Lawyers: ANJALA SAHU
• Assessee Lawyers: P J PARDIWALLA
• Keywords: Reopening of assessment; Question of law; Difference of opinion; Reason to believe; Change of opinion; Reassessment proceedings
• Section: 143(3); 80IB; 147; 148; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES A, HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER ITA NO. & C.O. THEREIN A.Y. APPELLANT RESPONDENT/ CROSS-OBJECTOR 1498/HYD/2012 & CO 159/HYD/12 200 3 - 0 4 THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-5(1), HYDERABAD. M/S. SAHARA STATES, HYDERABAD [PAN: AAAJS2519Q] 1499/HYD/2012 & CO 160/HYD/12 200 3 - 0 4 1500/HYD/2012 & CO 161/HYD/12 2004 - 05 1501 /HYD/2012 & CO 162/HYD/12 2004 - 05 1848 /HYD/2011 & CO. 4/HYD/12 2005 - 06 THE DY. COMMISSIONER OF INCOME TAX, CIRCLE-5(1), HYDERABAD. 1886 /HYD/2011 2006 - 07 SAHARA STATES - HYDERABAD, AOP (JOINT VENTURE), SAIFABAD, HYDERABAD. [PAN: AAAJS2519Q] THE DY. COMMISSIONER OF INCOME TAX, CIRCLE-5(1), HYDERABAD FOR REVENUE : S MT. ANJALA SAHU , DR FOR ASSESSEE : SHRI P.J. PARDIWALLA , AR DATE OF HEARING : 09 - 0 6 - 201 5 DATE OF PRONOUNCEMENT : 17 - 06 - 2015 O R D E R PER B. RAMAKOTAIAH, A.M. : THESE GROUP OF APPEALS, SINCE COMMON ISSUES ARE IN VOLVED, ARE HEARD TOGETHER AND DISPOSED-OFF BY THIS COMMON ORDE R. MOST OF THE APPEALS FROM ASSESSMENT YEAR (AY) 2003-04 TO 2005-0 6 ARE BY REVENUE, M/S. SAHARA STATES :- 2 -: WHEREAS APPEAL IN AY. 2006-07 WAS FILED BY M/S. SAH ARA STATES. THERE ARE CROSS OBJECTIONS BY ASSESSEE MOSTLY SUPPORTING THE ORDERS OF THE CIT(APPEALS). 2. BRIEFLY STATED FACTS COMMON TO APPEALS IN ALL TH ESE YEARS ARE THAT, ASSESSEE IS AN AOP, CONSTITUTED VIDE AGREEMENT DT. 30-11-2001. THE JOINT VENTURE AGREEMENT WAS MADE BETWEEN M/S. SAHAR A INDIA COMMERCIAL CORPORATION LTD., SAHARA INDIA FINANCIAL CORPORATION LTD., SAHARA INDIA CORPORATION LTD., AND SAIN PROCESSING AND WEAVING MILLS PVT. LTD., WITH AN INTENTION TO CONTINUE AND CARRY ON THE PROJECT WHICH WAS BEING DEVELOPED INDIVIDUALLY BY THEM. ASSESSEE -AOP TOOK OVER THE PROJECT, DEVELOPED THE HOUSING PROJECT AND CLAIMED DEDUCTION U/S. 80IB(10) OF THE INCOME TAX ACT [ACT], AS PER THE TH EN EXISTING PROVISIONS, COMMENCING FROM AY. 2003-04. IN THE ORIGINAL ASSES SMENT COMPLETED U/S. 143(3) FOR AYS. 2003-04, 2004-05 AND 2005-06, ASSESSING OFFICERS (AOS) DID EXAMINE THE ELIGIBILITY OF THE ASSESSEE A ND ALLOWED THE CLAIM OF DEDUCTION AFTER DUE VERIFICATION OF ALL AGREEMENTS, DOCUMENTS AND ALSO FIELD VERIFICATION BY THE INSPECTOR IN RESPECTIVE A SSESSMENT YEARS. SUBSEQUENTLY, WHILE COMPLETING THE ASSESSMENT FOR A Y. 2006-07, THE AO INSISTED ON FURNISHING 'PROJECT COMPLETION CERTIFIC ATE'. SINCE ASSESSEE COULD NOT FURNISH THE SAME, AO TOOK THE VIEW THAT A SSESSEE WAS NOT ELIGIBLE FOR DEDUCTION U/S. 80IB(10). CONSEQUENTLY , THE ASSESSMENTS COMPLETED IN EARLIER YEARS WERE RE-OPENED U/S. 147 MAINLY ON THE REASON THAT ASSESSEE HAS FAILED TO FURNISH THE 'PROJECT CO MPLETION CERTIFICATE'. AO RELIED ON THE BOARD'S LETTER IN D.O. NO. 277/MIS C.46 DT. 02-05-2008 FOR VERIFICATION OF THE DEDUCTION CLAIMED U/S. 80IB (10). RECORDING THE REASONS ACCORDINGLY, THE AO ISSUED NOTICES U/S. 147 AND COMPLETED THE ASSESSMENTS DISALLOWING THE CLAIM BASICALLY ON 3 RE ASONS: M/S. SAHARA STATES :- 3 -: (A) THAT THE HOUSING PROJECT WAS STARTED MUCH BEFORE 01 -10- 1998 BY ACQUIRING THE LAND IN THE YEAR 1996; (B) THAT AOP HAS NOT COMMENCED THE PROJECT RATHER CONTI NUED THE ONGOING PROJECT OF THE INDIVIDUAL MEMBERS; AND (C) THAT THE PROJECT HAS NOT BEEN COMPLETED WITHIN THE SPECIFIED LIMITS I.E., ON OR BEFORE 31-03-2008. BY ELABORATELY DISCUSSING THESE ISSUES, THE AO IN T HE IMPUGNED ASSESSMENT YEARS, DISALLOWED THE CLAIM IN THE RE-AS SESSMENT PROCEEDINGS IN AY. 2003-04, 2004-05 & 2005-06 AND U/S. 143(3) IN AY. 2006-07. 3. BEFORE THE LD.CIT(A) IT WAS CONTENDED THAT ASSES SEE HAS COMPLIED WITH ALL THE CONDITIONS OF SECTION 80IB(10). THESE WERE VERIFIED BY THE AO AT THE TIME OF ORIGINAL ASSESSMENT, INCLUDING FI ELD VERIFICATION BY THE I.T.I. SUBSEQUENT REOPENING OF ASSESSMENT IS NOTH ING BUT CHANGE OF OPINION BY THE OFFICER AND THERE IS NO VALID REASON TO REOPEN THE ASSESSMENT U/S. 147. IT HAS RAISED VARIOUS CONTENT IONS AND RELIED ON VARIOUS CASE LAW IN SUPPORT OF THE CONTENTIONS, QUE STIONING THE VALIDITY OF REOPENING OF ASSESSMENTS IN THE THREE IMPUGNED A SSESSMENT YEARS. IN AY. 2006-07, HOWEVER, SINCE THE ASSESSMENT WAS FIRS T TIME COMPLETED U/S. 143(3), ASSESSEE'S ARGUMENT WAS WITH REFERENCE TO PROJECT COMPLETION AND EVIDENCE THAT THE PROJECT WAS COMPLE TED, BUT THE NECESSARY CERTIFICATE WAS NOT GIVEN BY THE AUTHORIT IES. THE LD.CIT(A) WHILE UPHOLDING THE ASSESSMENT AND THE STAND OF THE AO IN AY. 2006-07 HOWEVER, CANCELLED/SET ASIDE THE ASSESSMENTS WHICH WERE REOPENED, AS BAD IN LAW. HIS ORDER, IN DETAIL IN AY. 2005-06, W AS AS UNDER: M/S. SAHARA STATES :- 4 -: '5.3 GIVEN THE ABOVE RATIOS, THE FACTS IN THE PRESE NT CASE ARE EXAMINED. FIRSTLY, I FIND THAT IN THE PRESENT CASE , THE ASSESSING OFFICER HAD EXAMINED THE ISSUE OF ALLOWABILITY OF DEDUCTION U/S. 80IB(10) IN GREAT AMOUNT OF DETAIL VIDE HIS ORDER DATED 30-03-2007 PA SSED U/S. 143(3) OF THE ACT. RELEVANT PORTIONS OF THE ORDER OF THE ASS ESSING OFFICER REFERRED TO IS QUOTED BELOW: THE ASSESSEE'S PROJECT SITE IS SITUATED AT MANSOORA BAD VILLAGE, SAROORNAGAR MANDAL, RANGA REDDY DISTRICT. THE MEMB ERS OF THE AOP ARE M/S. SAHARA INDIA COMMERCIAL CORPORATION LTD., (PREVIOUS M/S. SAHARA INDIA HOUSING LTD., CALCUTTA) M/S. SAHARA INDIA FINANCIAL CORPORA TION LTD., (LUCKNOW), M/S. SAHARA INDIA CORPORATION LTD., (NEW DELHI) AND M/S. SAIN PROCESSING AND WEAVING MILLS (P) LTD., NEW DELHI. DURING THE PREVIOUS YEAR RELEVANT TO THE AY. 2005- 06, THE ASSESSEE CLAIMED DEDUCTION UNDER SUB-SECTION 10 OF SEC. 80IB OF THE IT ACT FOR AN AMOUNT OF RS. 3,45,15,612/- THE PROFITS BEING DERIVED FROM DEVELOPING & BUILDING HOUSING PROJECT. THE SUB SECTION 10 OF SEC. 80 IB RELEVANT FOR THE AY. 2005-06 STIPULATED AS UNDER: THE AMOUNT OF DEDUCTION IN THE CASE OF AN UNDERTAK ING DEVELOPING AND BUILDING HOUSING PROJECTS APPROVED BEFORE THE 31 ST DAY OF MARCH, 2005, BY A LOCAL AUTHORITY, SHALL BE 100% OF THE PROFITS DERIVED IN ANY PREVIOUS YEAR RELEVANT TO ANY AY FROM SUCH HOUSING PROJECT, IF A) SUCH UNDERTAKING HAS COMMENCED OR COMMENCES DEVE LOPMENT AND CONSTRUCTION OF THE HOUSING PROJECT ON OR AFTER THE FIRST DAY OF OCTOBER 1998 AND COMPLETES SUCH CONSTRUCTION: (I) IN A CASE WHERE A HOUSING PROJECT HAS BEEN APPR OVED BY THE LOCAL AUTHORITY BEFORE THE 1 ST DAY OF APRIL, 2004 ON OR BEFORE THE 31 ST DAY OF MARCH, 2008; (II) IN A CASE WHERE A HOUSING PROJECT HAS BEEN OR IS APPROVED BY THE LOCAL AUTHORITY ON OR AFTER THE 1 ST DAY OF APRIL, 2004, WITHIN 4 YEARS FROM THE END OF THE FY IN WHICH THE HOUSING PROJECT IS APPROVED BY THE LOCAL AUTHORITY; EXPLANATION FOR THE PURPOSE OF THIS CLAUSE (I) IN A CASE WHERE THE APPROVAL IN RESPECT OF THE HOUSING PROJECT IS OBTAINED MORE THAN ONCE, SUCH HOUSING PR OJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON THE DATE O N WHICH THE BUILDING PLAN OF SUCH HOUSING PROJECT IS FIRST APPROVED BY THE LOCAL AUTHORITY; M/S. SAHARA STATES :- 5 -: (II) THE DATE OF COMPLETION OF CONSTRUCTION OF THE HOUSING PROJECT SHALL BE TAKEN TO BE THE DATE ON WHICH THE COMPLETI ON CERTIFICATE IN RESPECT OF SUCH HOUSING PROJECT IS I SSUED BY THE LOCAL AUTHORITY. B) THE PROJECT IS ON THE SIZE OF A PLOT OF LAND WHI CH HAS A MINIMUM AREA OF ONE ACRE: PROVIDED THAT NOTHING CONTAINED IN CLAUSE (A) OR CL AUSE (B) SHALL APPLY TO A HOUSING PROJECT CARRIED OUT IN ACCORDANCE WITH A SC HEME FRAMED BY THE CENTRAL GOVT. OR STATE GOVT. FOR RECONSTRUCTION OR REDEVELO PMENT OF EXISTING BUILDING IN AREAS DECLARED TO BE SLUM AREAS UNDER ANY LAW FOR T HE TIME BEING IN FORCE AND SUCH SCHEME IS NOTIFIED BY THE BOARD IN THIS BEHALF ; C) THE RESIDENTIAL UNIT HAS A MAXIMUM BUILT UP AREA OF 1,000 SQ. FT., WHERE SUCH RESIDENTIAL UNIT IS SITUATED WITHIN THE CITIES OF DELHI OR MUMBAI OR WITHIN 25 KILOMETERS FROM THE MUNICIPAL L IMITS OF THESE CITIES AND 1,500 SQ. FT., AT ANY OTHER PLACE. D) THE BUILT UP AREA OF THE SHOPS AND OTHER COMMERC IAL ESTABLISHMENTS INCLUDED IN THE HOUSING PROJECT DOES NOT EXCEED 5% OF THE AGGREGATE BUILT UP ARE OF THE HOUSING PROJECT OR 2,000 SQ. FT ., WHICHEVER IS LESS.' IN ORDER TO VERIFY THE ALLOWABILITY OF THE ASSESSE E'S CLAIM OF DEDUCTION U/S. 80IB (10) OF IT ACT, THE ASSESSEE WAS ASKED TO FILE CERTAIN INFORMATION/EXPLANATION, DOCUMENTS, LAY-OUT PLANS, TYPICAL FLOOR PLANS, ETC., IN SUPPORT OF ITS CLAIM. THE ASSESSEE IS ENGAGED IN THE CONSTRUCTION OF GRO UP HOUSING PROJECTS AND AS PER THE DOCUMENTS AND THE INFORMATION PRODUC ED DURING SCRUTINY PROCEEDINGS, THE PROJECT IS SPREAD OVER ON A TOTAL LAND OF 44.63 ACRES SITUATED AT MANSOORABAD VILLAGE, SAROOR NAGAR MANDAL, RANGA RED DY DISTRICT. THIS LAND WAS ACQUIRED BY THE ASSESSEE IN THE YEAR 1996 FROM SRI MAYUR KUNJ & OTHER. AS THIS LAND WAS EARLIER NOTIFIED FOR THE USE OF CONSE RVATION, LATER ON IT WAS CHANGED FROM CONSERVATION USE TO RESIDENTIAL USE BY THE STA TE GOVT. OF AP AND THE DRAFT VARIATION WAS PUBLISHED IN THE AP GAZEDTTE, DT. 19- 03-1998. THE ASSESSEE'S AR, SHRI MUDIT SAXENA STATED THAT THE PROJECT WAS C OMMENCED W.E.F. 10-07- 1999. DURING THE COURSE OF SCRUTINY PROCEEDINGS, THE ASS ESSEE'S AR PRODUCED COPIES OF THE LAY OUT PLAN ALONG WITH THE SANCTION LETTER OF HYDERABAD URBAN DEVELOPMENT AUTHORITY (HUDA) (IN LETTER NO. 14870/M P2/HUDA/98 DT. 07-07- 1999) AND LB MUNICIPALITY (IN PROC. NO. G2/3221/99 DT. 25-08-1999) IN RESPECT OF THE ENTIRE LAND OF 44.63 ACRES. THE ASSESSEE'S AR STATED THAT THE PROJECT CONSISTING OF VARIOUS TYPES OF HOUSES AND THESE TYP ES ARE FURTHER DIVIDED INTO BLOCKS. COPIES OF TYPICAL FLOOR PLANS APPROVED BY HUDA/LB NAGAR MUNICIPALITY M/S. SAHARA STATES :- 6 -: IN RESPECT OF ALL THE TYPES/BLOCKS RELEVANT TO THE FINANCIAL YEAR 2003-04 AND THE DETAILS OF SUCH APPROVALS ARE FURNISHED BY THE ASSE SSEE'S AUTHORISED REPRESENTATIVE AS MENTIONED BELOW: TYPE NAME OF THE BLOCK DATE OF HUDA APPROVAL DATE OF LB NAGAR MUNICIPALITY APPROVAL TYPE-I TYPE-II VRINDAVANI GANDHAR NEW MALHAR 07-07-1999 07-07-1999 07-07-1999 & 25-06-2003 25-08-1999 25-08-1999 07-01-2004 TYPE-III MALHAR BAHAR A (WEST) BAHAR B (WEST) 07-07-1999 07-07-1999 & 15-02-2002 07-07-1999 & 15-02-2002 25-08-1999 25-08-1999 25-08-1999 FUTURE HOUSES NEW BAHAR A&B YAMAN 07-07-1999 & 25-06-2003 07-07-1999 & 25-06-2003 07-01-2004 07-01-2004 PLOTTED HOUSE KALYANI 07-07-1999 & 25-06-2003 07-01-2004 TO FIND OUT WHETHER THE ASSESSEE HAD FOLLOWED THE E LIGIBILITY CRITERIA FOR CLAIMING DEDUCTION UNDER SEC. 80IB (10) OF IT ACT AND WHETHE R THE PROJECT WAS BUILT WITHIN THE FRAME-WORK OF THIS SECTION, THE INSPECTOR OF TH IS OFFICE WAS DIRECTED TO VISIT THE PROJECT SITE AND VERIFY THE CONSTRUCTION ACTIVI TY GOING ON IN THE SITE. THE INSPECTOR PHYSICALLY INSPECTED THE PROJECT WITH THE HELP OF ONE CIVIL ENGINEER, SHRI BALAKRISHNA AND SUBMITTED A DETAILED REPORT WH ICH IS REPRODUCED BELOW: 'AS DIRECTED BY THE ACIT, CIRCLE-5(1), HYDERABAD, I HAVE VISITED THE SITE OF M/S. SAHARA STATES, HYD. SITATED AT MANSURABAD VILLAGE, RANGA REDDY DIST., ALONGWITH SHRI MUDIT SAXENA ON 20-03-2007. FOR THE AY. 2005-06 ALSO THE ASSESSEE HAS CLAIMED EXEMPTION U/S. 80IB FOR THE INCOME EARNED ON THE SALE OF THE FOLLOWING RESIDENTIAL FLATS DURING THE PREVIOUS YEAR RELEVANT TO THE AY. 2004-05 AS DETAIL ED BELOW (EXCEPT IN RESPECT OF KALYANI PROJECT): M/S. SAHARA STATES :- 7 -: NAME OF THE BLOCK NO OF BLOCKS TOTAL NO. OF UNITS AS PER PLAN NO. OF UNITS SOLD DURING THE AY. 05-06 TYPE-I TYPE-II VRINDAVANI I) GANDHAR II) NEW MALHAR 4 13 13 16 144 156 156 19 10 81 TYPE-III PLOTTED MALHAR KALYANI 16 INDEPENDENT 192 80 06 11 HOUSES ROW BAHAR A & B -DO- 280 15 (BA 9+BB 6) FUTURE GROUP HOUSES I) NEW BAHAR II) YAMAN -DO- -DO- 38 17 7 2 TOTAL SOLD 184 HUDA ORIGINAL APPROVAL FOR CONSTRUCTION OF GROUP H OUSES DT. 07-07-1999 WAS PRODUCED FOR VERIFICATION AT THE TIME OF MY VIS IT (COPY OF WHICH IS AVAILABLE ON RECORD). DURING MY VISIT, I HAD TAKEN THE HELP OF SITE ENGI NEER OF SHARA GROUP, SHRI BALAKRISHNA FOR PHYSICAL VERIFICATION/MEASUREMENTS OF UNITS SOLD AT RANDOM IN EACH TYPE AS IT IS IMPRACTICABLE TO TAKE THE MEASUR EMENT OF ALL THE UNITS SOLD DURING THE RELEVANT PREVIOUS YEAR 2003-04 UNDER VAR IOUS TYPES: THE ARE AS PER THE MEASUREMENT OF EACH TYPE/BLOCK IS FOUND AS UNDER: NAME OF THE BLOCK BUILT UP AREA AS PER PHYSICAL MEASUREMENT TAKEN TYPE-I TYPE-II TYPE-II TYPE-III VRINDAVANI GANDHAR NEW MALHAR MALHAR 300 SQ. FT. TO 312 SQ. FT. 509 SQ. FT. TO 527 SQ. FT. 815 SQ. FT. TO 858 SQ. FT. 768 SQ. FT. TO 779 SQ. FT. ROW HOUSES BAHARA A (WEST) CATEGORY I 640 SQ. FT. TO 648 SQ. FT. ALFA 819 SQ. FT. TO 829 SQ. FT. BETA 940 SQ. FT. TO 951 SQ. FT. GAMA 1460 SQ. FT. TO 1464 SQ. FT. FUTURE GROUP HOUSES YAMAN TYPE-I 1130 SQ. FT. TO 1135 SQ. FT. TYPE-II 810 SQ. FT. TO 815 SQ. FT. NEW BAHAR 810 SQ. FT. TO 816 SQ. FT. KALYANI PLOTTED HOUSES 1508 SQ. FT. TO 1520 SQ. FT. NO. OF SHOPS SOLD 30 SHOPS M/S. SAHARA STATES :- 8 -: THE ASSESSEE HAS TAKEN SEPARATE APPROVAL FOR EACH T YPE OF BLOCK. DURING THE YEAR, THE ASSESSEE SOLD 30 COMMERCIAL S HOPS, WHICH IS VERIFIED FROM THE SALE DEEDS FURNISHED. THE ASSES SEE FIRM RESTRICTED ITS CLAIM U/S. 80IB TO THE PROFITS EARNED ON SALE OF RESIDENTIAL FLATS AND OFFERED INCOME ON COMMERCIAL SHOPS AND KALYANI PRO JECT. DURING THE COURSE OF SCRUTINY PROCEEDINGS, THE EXP ENDITURE CLAIMED TOWARDS BOOKING COMMISSION AMOUNTING TO RS. 35,23, 018/- WAS VERIFIED WITH RESPECT TO THE BILLS/VOUCHERS PRODUC ED BY THE ASSESSEE. IT IS OBSERVED THAT AN EXPENDITURE AMOUNTING TO RS. 3 ,49,855/- IS NOT PROPERLY SUPPORTED BY VOUCHERS. HENCE, THE SAME IS DISALLOWED AND ADDED. 5.3.1. FROM THE ABOVE, I FIND THAT COMPLETE DETAILS OF THE PROJECT WERE CALLED FOR DURING ASSESSMENT PROCEEDINGS AND EXAMINED. THE EL IGIBILITY CRITERIA UNDER SECTION 80IB(10) WERE EXAMINED IN DETAIL. EVEN PHY SICAL INSPECTION OF THE SITE WAS CARRIED OUT AND HELP OF THE SITE ENGINEER WAS A LSO TAKEN. DETAILED INVESTIGATIONS WERE MADE AND LAY OUT PLANS, SANCTIO N LETTERS, APPROVALS, VALUATIONS, PHYSICAL MEASUREMENTS OF VARIOUS FLATS WERE MADE. AFTER SUCH DETAILED INVESTIGATIONS ON THE SAME ISSUE, THE ASSE SSING OFFICER OPINED THAT DEDUCTION UNDER SECTION 80IB(10) WAS ALLOWABLE . 5.4 KEEPING IN VIEW THE ABOVE FACTS, IT IS CLEAR TH AT THE ISSUE OF NOTICE UNDER SECTION 148 WAS BASED ON A CHANGE OF OPINION AS NO FRESH INFORMATION HAS COME TO THE KNOWLEDGE OF THE ASSESS ING OFFICER WHICH WOULD HELP HIM TO FORM A BELIEF THAT INCOME HAD ESC APED ASSESSMENT. MOREOVER, THE LETTER FROM THE CBDT REFERRED TO BY T HE ASSESSING OFFICER WAS NEVER GIVEN OR SHOWN TO THE APPELLANT INSPITE O F SPECIFIC REQUESTS. IN ANY CASE, THE LETTER REFERRED TO DID NOT GIVE INFOR MATION ON TAX EVASION BY THE APPELLANT'. 4. WHILE ADJUDICATING THE ISSUE, THE LD.CIT(A) ALSO RELIED ON THE FOLLOWING FOR VARIOUS LEGAL PRINCIPLES, IE. THAT TH E ASSESSMENT CANNOT BE REOPENED BY A MERE CHANGE OF OPINION OR BY DRAWING A DIFFERENT INFERENCE FROM THE SAME FACTS AS WERE EARLIER AVAILABLE : (A) CIT VS. KELVINATOR OF INDIA LTD., [320 ITR 561 (SC) ] [256 ITR 1] [174 CTR (DEL) (FB) 617; M/S. SAHARA STATES :- 9 -: (B) APOLLO HOSPITALS ENTERPRISES LIMITED [287 ITR 25] ( HON'BLE MADRAS HIGH COURT); AND (C) CIT VS. ABDUL RAHAMAN SAIT [306 ITR 142] (HON'BLE M ADRAS HIGH COURT). 5. REVENUE IS IN APPEAL IN THREE ASSESSMENT YEARS , IN WHICH CIT(A) DID NOT APPROVE THE REOPENING OF ASSESSMENT WHEREAS , ASSESSEE IS IN APPEAL IN AY. 2006-07, WHEREIN LD.CIT(A) UPHELD AO' S STAND IN DENYING THE DEDUCTION U/S. 80IB(10). 6. LD. DR VEHEMENTLY SUBMITTED THAT THERE WAS NO CH ANGE OF OPINION AS CONTENDED BY ASSESSEE AND ACCEPTED BY THE LD.CIT (A) AS ASSESSEE HAS NOT FURNISHED 'PROJECT COMPLETION CERTIFICATE' NOR FURNISHED THE COMPLETE DETAILS OF AOP AS POINTED OUT BY THE AO. IT WAS THE SUBMISSION THAT THE ORIGINAL PROJECT HAS STARTED WAY BACK IN 1996 AND T HEREFORE, IT DID NOT SATISFY THE CONDITIONS LAID DOWN U/S. 80IB(10). LD . DR RELIED ON THE FOLLOWING: (A) HON'BLE SUPREME COURT IN THE CASE OF RAJESH JHAVERY STOCK BROKERS P. LTD [291 ITR 500] (SC); (B) CENTRAL PROVINCES MANGANESE ORE CO LTD VS ITO [191 ITR 662]; FOR REOPENING AND (C) CO-ORDINATE BENCH DECISION IN THE CASE OF SAINATH E STATES P. LTD., VS. DCIT 08-02-2013 FOR THE PROPOSITION THAT DEDUCTION WAS NOT ALLOWABLE ON FAILURE TO FURNISH C OMPLETION CERTIFICATE OF HOUSING PROJECT. DETAILED WRITTEN SUBMISSIONS WERE ALSO PLACED ON RE CORD IN SUPPORT OF THE CONTENTIONS. M/S. SAHARA STATES :- 10 -: 7. LD. COUNSEL FOR THE ASSESSEE HOWEVER, COUNTERING THE ARGUMENTS OF THE DR SUBMITTED THAT LAND WAS ACQUIRED WAY BACK IN 1996 ON WHICH THERE IS NO DISPUTE. BUT, THE AOP WAS CONSTITUTED BY THE MEMBERS CONTRIBUTING THE LAND AS THEIR CAPITAL AND REFERRED TO VARIOUS FINDINGS BY THE AO AT THE TIME OF ORIGINAL ASSESSMENT THAT THE VARIOUS APPROVALS HAVE BEEN OBTAINED CONSEQUENTLY AND THE PROJECT HAS STARTED AFTER 01- 10-1998. HE REFERRED TO THE PAPER BOOK FILED IN TH IS REGARD TO SUBMIT THAT AO AT THE TIME OF ASSESSMENT U/S. 143(3) IN RE SPECTIVE ASSESSMENT YEARS NOT ONLY EXAMINED IN DETAIL THE ELIGIBILITY O F THE ASSESSEE WITH REFERENCE TO VARIOUS PERMISSIONS, PROJECTS, EXPENDI TURES BUT ALSO DEPUTED HIS INSPECTOR TO VERIFY THE MEASUREMENTS OF THE VARIOUS HOUSING UNITS BEING CONSTRUCTED. SINCE THE AO EXAMINED IN DETAIL AND FOUND SATISFIED WITH THE FULFILLING OF CONDITIONS FOR CLA IMING DEDUCTION U/S 80IB(10) ALLOWED THE SAME. WITHOUT MENTIONING ANY N ON-FURNISHING OF INFORMATION BY ASSESSEE, THE ASSESSMENTS ARE REOPEN ED AFTER END OF FOUR YEARS FOR THE AYS. 2003-04 AND 2004-05. EVEN THOUG H, ASSESSMENT FOR AY. 2005-06 WAS REOPENED WITHIN FOUR YEARS, AS HELD BY THE HON'BLE GUJARAT HIGH COURT IN THE CASE OF KALPATARU STHAPAT YA (P) LTD. VS. ITO [346 ITR 371] AND ALSO HON'BLE BOMBAY HIGH COURT IN THE CASE OF PRASHANT S. JOSHI VS. ITO & ANR. [324 ITR 154], THE RE CANNOT BE ANY REASON TO BELIEVE SO AS TO REOPEN THE ASSESSMENT WH EN ASSESSEE SATISFIED ALL THE CONDITIONS AND THE DEDUCTIONS WERE ALLOWED. ACCORDINGLY, HE SUPPORTED THE ORDER OF THE CIT(A) IN CANCELLING THE REOPENING OF ASSESSMENTS. 8. COMING TO THE MERITS OF THE ISSUE, IT WAS SUBMIT TED THAT THERE ARE ONLY THREE CONDITIONS WHEN THE PROJECT HAS STARTED WHICH THE ASSESSEE SATISFIED, THEREFORE, THE REOPENING ON THE BASIS OF 'PROJECT COMPLETION CERTIFICATE' HAVING NOT FILED DOES NOT ARISE, AS SU CH CONDITION CAME SUBSEQUENTLY WITH THE FINANCE ACT, 2004 BY AN AMEND MENT TO THE ACT M/S. SAHARA STATES :- 11 -: W.E.F. 01-04-2005. SINCE THE PROJECT WAS APPROVED PRIOR TO 01-04-2005, THIS CONDITION OF COMPLETION BEFORE 31-03-2008 WAS NOT SPECIFIED AT THE TIME OF STARTING THE PROJECT AND THE SAME CANNOT BE IMPLEMENTED OR COULD NOT BE VISUALIZED. FOR THIS PROPOSITION RELIE D ON THE JUDGMENT OF HON'BLE SUPREME COURT IN THE CASE OF CIT-19, MUMBAI VS. M/S. SARKAR BUILDERS IN CIVIL APPEAL NO. 4476 OF 2015 ARISING O UT OF SLP (C) NO. 24330 OF 2011 DT. 15 TH MAY, 2015. NOT ONLY THAT LD. COUNSEL ALSO PLACED ON RECORD THE CORRESPONDENCE WITH THE LOCAL AUTHORI TIES FOR FURNISHING THE COMPLETION CERTIFICATE AND EVIDENCE WITH REFERE NCE TO THE FACT THAT PROJECT WAS COMPLETED BY 31-03-2008. IT WAS THE CO NTENTION THAT AO CANNOT INSIST ON 'PROJECT COMPLETION CERTIFICATE' B ASED ON SUBSEQUENT AMENDMENT AND CANNOT DENY THE DEDUCTION AS RELEVANT AUTHORITIES ARE NOT ISSUING THE CERTIFICATE, EVEN THOUGH ASSESSEE H AS INDEED COMPLETED THE PROJECT WITHIN THE TIME LIMITS, EVEN CONTEMPLAT ED BY THE AMENDED PROVISIONS. HOWEVER, THE MAIN CONTENTION OF THE LD . COUNSEL IS THAT ASSESSEE CANNOT BE ASKED TO FULFILL THE CONDITION W HICH WAS NOT THERE WHEN THE PROJECT WAS APPROVED AND THE CONDITION WAS NOT STIPULATED AT THE TIME OF CLAIMING THE DEDUCTION. 9. WE HAVE CONSIDERED THE RIVAL CONTENTIONS AND PER USED THE RECORDS AND PAPER BOOK PLACED ON RECORD. AS FAR AS REOPENI NG OF ASSESSMENTS U/S. 147/148 ARE CONCERNED, WE AGREE WITH THE LD.CI T(A) THAT THIS IS A MERE CHANGE OF OPINION. IN FACT, THE AO AT THE TIM E OF COMPLETION OF ASSESSMENT HAS INDEED TAKEN PAINS IN EXAMINING THE ELIGIBILITY AND ALSO DEPUTED HIS INSPECTOR AND ALLOWED THE DEDUCTION AFT ER DUE VERIFICATION. THERE IS ALSO NO DISPUTE THAT THE RELEVANT PROVISIO N OF SECTON 80IB(10) AT THE TIME OF CLAIM IN AY. 2003-04 WAS AS UNDER: '(10) THE AMOUNT OF PROFITS IN CASE OF AN UNDERTAKI NG DEVELOPING AND BUILDING HOUSING PROJECTS APPROVED BEFORE THE 31 ST DAY OF MARCH, 2005 BY A LOCAL AUTHORITY, SHALL BE HUNDRED PER CENT OF THE PROFITS DERIVED IN ANY M/S. SAHARA STATES :- 12 -: PREVIOUS YEAR RELEVANT TO ANY ASSESSMENT YEAR FROM SUCH HOUSING PROJECT IF, - (A) SUCH UNDERTAKING HAS COMMENCED OR COMMENCES DEVELOP MENT AND CONSTRUCTION OF THE HOUSING PROJECT ON OR AFTER THE 1 ST DAY OF OCTOBER, 1998; (B) THE PROJECT IS ON THE SIZE OF A PLOT OF LAND WHICH HAS A MINIMUM AREA OF ONE ACRE; AND (C) THE RESIDENTIAL UNIT HAS A MAXIMUM BUILT-UP AREA OF ONE THOUSAND SQUARE FEET WHERE SUCH RESIDENTIAL UNIT IS SITUATED WITHIN THE CITIES OF DELHI OR MUMBAI OR WITHIN TWEN TY-FIVE KILOMETERS FROM THE MUNICIPAL LIMITS OF THESE CITIE S AND ONE THOUSAND AND FIVE HUNDRED SQUARE FEET AT ANY OTHER PLACE'. THUS, THERE ARE THREE CONDITIONS STIPULATED ORIGINA LLY UNDER THE PROVISIONS OF SECTION 80IB(10). 10. AS FAR AS CHRONOLOGICAL EVENTS OF THE HOUSING P ROJECTS ARE CONCERNED, THERE IS NO DISPUTE TO THE FOLLOWING FAC TS: (I) IN THE YEAR 1996, M/S. SAHARA INDIA HOUSING LTD., M /S. SAHARA FINANCIAL INDIA CORPORATION LTD., M/S. SAHARA STATE S ETC., AND OTHERS ACQUIRED LAND ADMEASURING 44.63 ACRES FROM S RI MAYUR KUNJ & OTHERS. (II) LAND USE WAS CHANGED FROM 'CONSERVATION TO RESIDENT IAL USE' BY GOVERNMENT OF ANDHRA PRADESH. VARIATION IN LAND US E WAS PUBLISHED IN ANDHRA PRADESH GAZETTE ON 19-03-1998. (III) THE HOUSING PROJECT HAS SEVEN BLOCKS NAMELY, VRINDAVANI, GANDHAR, MALLHAR, NEW MALLHAR, BAHAR, NEW BAHAR AND YAMAN. THESE BLOCK HAVE FLATS AS WELL AS ROW HOUSES RANGIN G FROM 345.83 SQ. FT TO 1498 SQ. FT. M/S. SAHARA STATES :- 13 -: (IV) THE HYDERABAD URBAN DEVELOPMENT AUTHORITY (HUDA), SANCTIONED BUILDING PLANS IN RESPECT OF BLOCKS VRINDAVANI, GAN DHAR AND MALLHAR VIDE LETTER DATED 07-07-1999 IN RESPECT OF BAHAR BUILDING PLANS WERE SANCTIONED ON 15-02-2002 AND BUILDING PL AN FOR REMAINING BLOCKS WERE SANCTIONED ON 25-06-2003. (V) L B NAGAR MUNICIPALITY GRANTED APPROVAL FOR ENTIRE LAND OF 44.63 ACRES ON 25-08-1999. (VI) DEVELOPMENT AND CONSTRUCTION OF HOUSING PROJECT WA S STARTED W.E.F. 10-07-1999 I.E., IMMEDIATELY AFTER SANCTION OF BUILDING PLANS. 11. THE ABOVE CHRONOLOGICAL EVENTS WERE NOT DISPUTE D BY THE EITHER OF THE PARTIES. IT WAS ONLY THE CONTENTION OF THE LAT ER AO THAT SINCE ASSESSEE HAS PURCHASED THE LAND AS EARLY AS 1996, T HE PROJECT WAS TO BE DEEMED TO HAVE STARTED THEN AND THE SAME WAS PRIOR TO 01-10-1998. THEREFORE, THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTI ON. THIS CONTENTION CANNOT BE ACCEPTED AS THE PROJECT WAS NOT EVEN APPR OVED BY THE LOCAL AUTHORITIES. NOT EVEN BY 01-10-1998, AS CAN BE SEE N FROM THE APPROVALS STATED ABOVE. THEREFORE, THE PROJECT HAS STARTED A FTER 01-10-1998 AND THEREFORE, THE CONTENTION OF THE AO THAT THE PROJEC T STARTED BEFORE THAT DATE IS NOT FACTUALLY CORRECT. MOREOVER, CLAIM OF ASSESSEE THAT ASSESSEE HAS ENTERED INTO JOINT VENTURE AGREEMENT AND ALL TH E PARTIES HAVE STARTED THE PROJECT IN THEIR INDIVIDUAL CAPACITY. AS PER RE CORD, MEMBERS CONTRIBUTED THEIR LAND AS CAPITAL, WHEREAS THE PROJ ECT WAS CONCEIVED AND CONSTRUCTED BY THE AOP AND THE CLAIM WAS ACCORDINGL Y MADE IN THE HANDS OF THE AOP. SINCE THESE ASPECTS WERE EXAMINE D BY THE AOS AT THE TIME OF ORIGINAL ASSESSMENT, THE OPINION OF THE SUB SEQUENT AO THAT AOP CONTINUED THE PROJECT CANNOT BE ACCEPTED. LASTLY, WITH REFERENCE TO THE PROJECT COMPLETION WHICH WAS ONE OF THE REASONS F OR REOPENING M/S. SAHARA STATES :- 14 -: ASSESSMENTS AND ALSO FOR DENYING THE DEDUCTION IN A Y. 2006-07 (WHICH WAS UPHELD BY THE CIT(A)), THIS WAS ON THE BASIS O F SUBSEQUENT AMENDMENT TO SUB-SECTION 10 OF SECTION 80IB(10) W.E .F. 01-04-2005. FURNISHING OF 'PROJECT COMPLETION CERTIFICATE' WAS NOT EVEN STIPULATED IN AYS. 2003-04 AND 2004-05, THEREFORE, THAT CANNOT BE THE BASIS FOR REOPENING THE ASSESSMENTS. THEREFORE, AO'S STAND O N THIS REGARD CANNOT BE ACCEPTED. 12. AS FAR AS AY. 2005-06 AND 2006-07 ARE CONCERNED , THIS CONDITION HAS COME UP FOR THE FIRST TIME BY THE AMENDMENT TO THE ACT FOR ALL THE PROJECTS WHICH ARE APPROVED BEFORE 01-04-2004, BUT ON OR AFTER 01-04- 1998. THIS ISSUE OF STIPULATION FOR COMPLETION OF PROJECT BY 31-03-2008 IS SUBJECT MATTER OF LITIGATION, AS VARIOUS ASSESSE ES HAVE BEEN DENIED DEDUCTION BASED ON THE AMENDED PROVISIONS OF THE AC T. THE MATTER HAS ULTIMATELY REACHED HON'BLE SUPREME COURT AND BY THE JUDGMENT IN THE CASE OF CIT-19, MUMBAI VS. M/S. SARKAR BUILDERS (SU PRA), THIS ISSUE WAS SET AT REST BY THE HON'BLE SUPREME COURT, WHILE EXA MINING THE AMENDED PROVISIONS OF THE SECTION 80IB. (EXTRACTS) 'WE ARE CONCERNED WITH THE AMENDMENT TO THE SAID SU B-SECTION CARRIED OUT BY FINANCE NO.2, ACT, 2004 W.E.F. 01-04 -2005. IN ALL THESE CASES, THOUGH THE HOUSING PROJECTS WERE SANCTIONED MUCH BEFORE THE SAID AMENDMENT BUT HAVE BEEN COMPLETED AFTER 01-04-2005 WHEN AMENDED PROVISION HAS COME INTO OPERATION. IT IS ALSO NOT IN DISPUTE THAT THE AMENDMENT IS PROSPECTIVE IN NATURE. INTERESTINGLY, WHEN THE HOUSING PROJECT WAS APPROVED BY A LOCAL AUTHORITY, WHICH IS THE REQUIREMENT UNDER SUB-SECTION (10) OF SECTION 80IB, AS ON THAT DATE, THE CONDITIONS STIPULATED IN THE SAID SUB-SECTION WERE MET BY THE ASSESSEES. HOWEVER, CONDITION IN CLAUSE (D) WHICH WAS LAID DOWN FOR THE FIRST TIME B Y THE AMENDMENT MADE EFFECTIVE FROM 01-04-2005 IS NOT FULFILLED. IN THI S SCENARIO, THE QUESTION IS AS TO WHETHER THE NEW CONDITIONS MENTIONED IN THE A MENDED PROVISION HAVE ALSO TO BE FULFILLED ONLY BECAUSE THE HOUSING PROJECTS IN QUESTION, THOUGH STARTED BEFORE 01-04-2005, WERE COMPLETED AF TER THE SAID DATE. THE QUESTION OF LAW, THAT ARISES FOR DISCUSSION THA T NEEDS TO BE ANSWERED IS THUS COMMON IN ALL THESE APPEALS AND CAN BE FORM ULATED AS UNDER: M/S. SAHARA STATES :- 15 -: 'WHETHER SECTION 80IB(10)(D) OF THE INCOME TAX ACT, 1961 APPLIES TO A HOUSING PROJECT APPROVED BEFORE 31-03-2005 BUT CO MPLETED ON OR AFTER 01-04-2005?' 13. EVEN THOUGH THE HON'BLE SUPREME COURT WAS MAINL Y CONCERNED WITH CLAUSE - (D) OF SECTION 80IB(10) AS AMENDED, T HE HON'BLE SUPREME COURT DEALT WITH THE ENTIRE PROVISION AND APPROVED THE HON'BLE BOMBAY HIGH COURT JUDGMENT IN THE CASE OF CIT VS. M/S. BRA HMA ASSOCIATES [333 ITR 289]. HON'BLE SUPREME COURT VIDE PARA 12 HAS HELD AS UNDER: '12. THE ISSUES DEALT WITH FROM PARAS 21 TO 25 BY T HE HIGH COURT ALREADY STANDS APPROVED BY THIS COURT. IN PARA 29, THE HIG H COURT HAS HELD THAT CLAUSE (D) HAS PROSPECTIVE OPERATION, VIZ., WITH EF FECT FROM 01-04-2005, AND THIS LEGAL POSITION IS NOT DISPUTED BY THE REVENUE BEFORE US. WHEAT FOLLOWS FROM THE ABOVE IS THAT PRIOR TO 01-04-2005, THESE DEVELOPERS/ASSESSEES WHO HAD GOT THEIR PROJECTS SAN CTIONED FROM THE LOCAL AUTHORITIES AS 'HOUSING PROJECTS' EVEN WITH COMMERC IAL USER, THOUGH LIMITED TO THE EXTENT PERMITTED UNDER THE DC RULES, WERE CO NVINCED THAT THEY WOULD BE GETTING THE BENEFIT OF 100% DEDUCTION OF T HEIR INCOME FROM SUCH PROJECTS UNDER SECTION 80IB OF THE ACT. THEIR PROJ ECTS WERE SANCTIONED MUCH BEFORE 01-04-2005. AS PER THE PERMISSIBLE COM MERCIAL USER ON WHICH THE PROJECT WAS SANCTIONED, THEY STARTED THE PROJECTS AND THE DATE OF COMMENCING SUCH PROJECT IS ALSO BEFORE 01-04-200 5. ALL THESE ASSESSEES WERE MADE KNOWN OF THE PROVISION BY WHICH THESE PROJECTS ARE TO BE COMPLETED AS THOSE DATES HAVE BEEN SPECIFIED FROM TIME TO TIME BY SUCCESSIVE FINANCE ACTS IN THE SAME PROVISION SECTI ON 80IB. IN THESE CASES, COMPLETION DATES WERE AFTER 01-04-2005. ONC E THEY ARRANGE THEIR AFFAIRS IN THIS MANNER, THE REVENUE CANNOT DENY THE BENEFIT OF THIS SECTION APPLYING THE PRINCIPLE OF RETROACTIVITY EVEN WHEN T HE PROVISION HAS NO RETROSPECTIVITY. TAKE FOR EXAMPLE, A CASE WHERE UN DER THE EXTANT DC RULES, FOR SHOPS AND COMMERCIAL ACTIVITY CONSTRUCTI ON PERMITTED WAS, SAY, 10% AND THE PROJECT WAS ALSO SANCTIONED ALLOWING A PARTICULAR ASSESSEE TO CONSTRUCT 10% OF THE AREA FOR COMMERCIAL PURPOSES. THE SAID DEVELOPER STARTED WITH ITS PROJECT MUCH PRIOR TO 01-04-2005 W ITH THE AFORESAID PERMISSIBLE USE AND THE CONSTRUCTION WAS AT A VERY ADVANCED STAGE AS ON 01-04-2005. CAN IT BE ARGUED BY THAT REVENUE THAT HE IS TO DEMOLISH THE EXTRA COVERAGE MEANT FOR COMMERCIAL PURPOSE AND BRI NG THE SAME WITHIN THE LIMITS PRESCRIBED BY THE NEW PROVISION IF HE WA NTED TO AVAIL THE BENEFIT OF DEDUCTION UNDER SECTION 80IB(10) OF THE ACT, ONL Y BECAUSE OF THE REASON THAT THE PROJECT WAS NOT COMPLETE AS ON 01-04-2005? AS IN SUCH A CASE HE FILED HIS RETURN FOR AN ASSESSMENT YEAR AFTER 01-04 -2005 AND FOR THE PURPOSE OF ASSESSMENT OF THE SAID RETURN, LAW PREVA ILING AS ON THAT DATE M/S. SAHARA STATES :- 16 -: WOULD BE APPLICABLE? ANSWER HAS TO BE IN THE NEGAT IVE ON THE PRINCIPLE THAT WITH THE AFORESAID PLANNING AS PER THE LAW PRE VAILING PRIOR TO 01-04- 2005, THESE ASSESSEES ACTED AND ACQUIRED VESTED RIG HT THEREBY WHICH CANNOT BE TAKEN AWAY. IT IS LUDICROUS ON THE PART OF THE REVENUE AUTHORITIES TO EXPECT THE ASSESSEES TO DO SOMETHING WHICH IS ALMOST IMPOSSIBLE'. RESPECTFULLY FOLLOWING THE SAME, WE ARE OF THE OPIN ION THAT ASSESSEE CANNOT BE COMPELLED TO COMPLY WITH THE CONDITION OR FULFILL THE CONDITION WHICH WAS NOT STIPULATED AT THE TIME OF SANCTION OF THE PROJECT. THE CASE LAW RELIED ON BY LD. DR DOES NOT APPLY ON FACTS AND ALSO IN VIEW OF JUDGMENT OF HONBLE SUPREME COURT CITED ABOVE.. 14. APART FROM THE JUDICIAL PRINCIPLES AS STATED BY THE HON'BLE SUPREME COURT, EVEN ON FACTS ALSO THE DEDUCTION CAN NOT BE DENIED. ASSESSEE HAS COMPLETED ITS PROJECT BY 31-03-2008 AN D HAS REQUESTED THE LOCAL AUTHORITIES FOR APPROVING THE FINAL PROJECT. IF THE LOCAL AUTHORITIES DID NOT ISSUE THE 'PROJECT COMPLETION CERTIFICATE' AS REQUESTED BY ASSESSEE, IT IS NOT POSSIBLE TO FURNISH THE SAID CE RTIFICATE TO THE REVENUE AUTHORITIES. ALL THE EVIDENCES ON RECORD DO INDICA TE THAT ASSESSEE HAS COMPLETED THE PROJECT, THEREFORE, JUST BECAUSE ASSE SSEE COULD NOT FURNISH THE 'PROJECT COMPLETION CERTIFICATE', THE DEDUCTION CANNOT BE DENIED ON THAT BASIS. THE ELIGIBLE DEDUCTION CANNOT BE DENIE D TO THE ASSESSEE. 15. IN VIEW OF THE ABOVE, WE UPHOLD THE ORDERS OF T HE CIT(A) SETTING ASIDE THE REASSESSMENT PROCEEDINGS IN AYS. 2003-04, 2004-05 AND 2005-06. REVENUE APPEALS HAVE NO MERIT AND ACCORD INGLY THEY ARE DISMISSED. 16. AS FAR AS AY. 2006-07 IS CONCERNED, FOR THE DET AILED DISCUSSION MADE ABOVE, ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S. 80IB(10) AND THEREFORE, AO IS DIRECTED TO ALLOW THE SAME. SINCE THE ASSESSMENT IS M/S. SAHARA STATES :- 17 -: COMPLETED U/S. 143(3), ISSUE OF REOPENING DOES NOT ARISE. THEREFORE, ON MERITS, ASSESSEE'S CONTENTIONS ARE ACCEPTED AND AO IS DIRECTED TO ALLOW THE DEDUCTION. 17. THE CROSS APPEALS ARE IN SUPPORT OF CIT(A)'S OR DER. SINCE WE HAVE DISMISSED ALL THE APPEALS OF REVENUE, ALL THE CROSS APPEALS HAVE BECOME ACADEMIC IN NATURE AND CONSIDERED AS INFRUCTUOUS. PENALTY ORDERS IN ITA NO. 1499/HYD/2012, C.O.NO. 16 0/HYD/2012 (AY.2003-04) & 1501/HYD/2012, C.O.NO. 162/HYD/2012 (AY.2004-05) : 18. THE AO LEVIED PENALTY U/S 271(1)(C) AFTER THE CLAIM WAS DISALLOWED. WE HAVE UPHELD THE ORDERS OF CIT(A) SETTING ASIDE T HE REOPENING OF ASSESSMENTS. CONSEQUENTLY, THERE CANNOT BE PENALTY IN IMPUGNED YEARS. THE ORDERS OF THE CIT(A) CANCELLING THE PENALTY LEV IED BY THE AO IN REOPENING ASSESSMENT PROCEEDINGS ARE TO BE UPHELD. REVENUE'S APPEALS ARE ACCORDINGLY DISMISSED. THE CROSS OBJECTION IN S UPPORT OF CIT(A) ORDERS ARE ACCORDINGLY DISMISSED AS INFRUCTUOUS. 19. IN THE RESULT, ALL THE APPEALS OF REVENUE AND C ROSS OBJECTIONS OF ASSESSEE ARE DISMISSED AND ASSESSEE'S APPEAL IN ITA NO. 1886/HYD/2011 FOR THE AY. 2006-07 IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 17 TH JUNE, 2015 SD/- SD/- (ASHA VIJAYARAGHAVAN) (B. RAM AKOTAIAH) JUDICIAL MEMBER ACC OUNTANT MEMBER HYDERABAD, DATED 17 TH JUNE, 2015 TNMM M/S. SAHARA STATES :- 18 -: COPY TO : 1. THE DY. COMMISSIONER OF INCOME TAX, CIRC LE - 5(1), HYDERABAD. 2. THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-5(1 ), 6 TH FLOOR, AAYAKAR BHAVAN, BASHEERBAGH, HYDERABAD. 3. M/S. SAHARA STATES-HYDERABAD, AOP (JOINT VENTURE ), SAHARA STATES, SAHARA MANZIL, SAIFABAD, HYDERABAD. 4. CIT(APPEALS)-V, HYDERABAD. 5. CIT-IV, HYDERABAD. 6. D.R. ITAT, HYDERABAD. 7. GUARD FILE.