M/s. Satsang Developers, Baroda V. The ACIT.,Circle-2(2), Baroda

ITA 1011/AHD/2012

• Counselvise Citation: [2013] 140 COUNSELVISE.COM (IT) 67930 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 6 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 12-11-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 01-08-2013
• Assessment Year: 2008-2009
• Appeal Filed On: 09-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Additional evidence
• Section: 80IB

Judgement Text

, , , , , , , , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI MUKUL KR.SHRAWAT, JUDICIAL MEMBER AND SHRI A.K. GARODIA, ACCOUNTANT MEMBER APPEAL(S) BY APPELLANT VS. RESPONDENT SL. NO(S) . ITA NO(S) ASSESSMENT YEAR(S) APPELLANT (S) RESPONDENT(S) 1. 1011/AHD/2012 2008-09 M/S.SATSANG DEVELOPERS 17, SATSANG BUNGALOWS B/H AIMS OXYGEN OLD PADRA ROAD BARODA PAN ABCFS 2815C ACIT CIRCLE-2(2) BARODA 2. 2498/AHD/2012 2008-09 ASSESSEE REVENUE 3. 1221/AHD/2012 2008-09 REVENUE ASSESSEE ASSESSEE BY : SHRI MUKUND BAKSHI, AR REVENUE BY : SHRI K.C.MATHEWS, SR.D R / / / / DATE OF HEARING : 23/08/2013 !'# / DATE OF PRONOUNCEMENT : 12/11/2013 $% / O R D E R PER SHRI A.K.GARODIA ACCOUNTANT MEMBER: OUT OF THESE THREE APPEALS, THERE ARE TWO CROSS-AP PEALS BY THE ASSESSEE AND THE REVENUE ARISING OUT OF THE ASSESSMENT ORDER PASSED BY THE AO U/S.143(3) OF THE ACT BEING ITA NOS.1011 & 1221/AHD/2012 DIREC TED AGAINST THE ORDER OF LD.CIT(A)-II, BARODA DATED 05/03/2012. THE REMAINI NG ONE APPEAL, I.E. ITA NO.2498/AHD/2012 IS AN ASSESSEES APPEAL ARISING OU T OF THE PENALTY ORDER PASSED U/S.271(1)(C) OF THE ACT FOR THE SAME ASSESS MENT YEAR AND THIS APPEAL IS ARISING OUT OF A SEPARATE ORDER OF LD.CIT(A)-II BAR ODA PASSED BY HIM U/S.271(1)(C) OF THE ACT. FOR THE SAKE OF CONVENIE NCE, ALL THE APPEALS ARE BEING DISPOSED OF BY WAY OF THIS COMMON ORDER. ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 2 - 2. FIRST, WE DISPOSE OF THE CROSS-APPEALS IN QUANTU M PROCEEDINGS. 2.1. BRIEF FACTS TILL THE ASSESSMENT STAGE ARE NOTE D BY THE LD.CIT (A) IN PARAGRAPH NOS.1 TO 3.1.2 OF HIS ORDER AND THESE PAR AS ARE REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE. INTRODUCTION: THIS APPEAL HAS BEEN FILED AGAINST HE ORDER U/S.143 (3) & 154 OF THE INCOME-TAX ACT, 1961 FOR THE ASSESSMENT YEAR 2008-0 9 PASSED BY THE ASST. COMMISSIONER OF INCOME-TAX, CIRCLE-2(1), BARODA. I N RESPONSE TO NOTICE OF HEARING, SHRI PRADIP GORADIA, CA AUTHORIZED REPR ESENTATIVE OF THE APPELLANT ATTENDED AND DISCUSSED THE APPEAL. 2. BACKGROUND OF THE CASE: THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS ENGA GED IN THE BUSINESS OF CONSTRUCTION. THE RETURN OF INCOME WAS FILED ON 30 .09.2008 DECLARING TOTAL INCOME OF RS.38,95,700/-. THE ASSESSMENT U/S .143(3) WAS FINALIZED ON 30.12.2010 DETERMINING TOTAL INCOME OF RS.3,21,6 4,520/- AFTER REJECTING THE CLAIM OF DEDUCTION U/S.80IB(10) OF TH E INCOME-TAX ACT. 3. GROUND NO.1 & 2: THE FIRST AND SECOND GROUNDS OF APPEAL ARE THAT THE LEARNED ASSESSING OFFICER HAS ERRED ON THE FACTS AND IN THE CIRCUMSTA NCES OF THE CASE AND IN LAW IN DISALLOWING THE CLAIM OF DEDUCTION U/S.80IB( 10) OF RS.2,82,68,816/- AND NOT ALLOWING THE PROFIT ATTRIB UTABLE TO THE SALE OF UNUTILIZED FSI OF RS.40,87,520/-. SINCE BOTH THE I SSUES ARE INTERRELATED THEY ARE CONSIDERED TOGETHER. 3.1. FINDINGS IN THE ASSESMSENT ORDER: 3.1.1. THE ASSESSEE IN ITS RETURN OF INCOME HAS CL AIMED DEDUCTION UNDER SECTION 80IB (10). THE ASSESSING OFFICER ARRIVED A T THE FOLLOWING FINDINGS UPON VERIFICATION OF DETAILS AND DOCUMENTS FILED DU RING ASSESSMENT PROCEEDINGS:- ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 3 - I) THE ASSESSEE WAS NOT THE OWNER OF THE LAND ON W HICH CONSTRUCTION ACTIVITIES WERE CARRIED OUT/PROJECT WAS BUILT UP. II) THE ASSESSEE HAS NOT TAKEN THE APPROVAL OF THE HOUSING PROJECT FROM THE LOCAL AUTHORITY. THE SAME WAS TAKEN BY TH E OTHER PERSON WHO IS ENTIRE SEPARATE ENTITY IN THE EYES OF LAW. III) THE LAND OWNERS HAVE SOLD THE PIECES OF LAND T O UNIT HOLDERS DIRECTLY AND ASSESSEE HAD ACTED MERELY AS A CONFIRM ING PARTY. IV) ASSESSEE FIRM HAS ACTED MERELY AS A CONTRACTOR AS IT HAS ENTERED INTO CONSTRUCTION AGREEMENT WITH THE UNIT HOLDERS. V) THE ASSESSEE FIRM HAS NEVER SOLD THE HOUSE TO TH E UNIT HOLDERS AS THERE WAS NO REGISTERED DOCUMENTS IN RESPECT THEREO F. 3.1.2. THE DEDUCTION U/S.80IB(10 WAS DISALLOWED BY THE ASSESSING OFFICER ON THE GROUND THAT THE ASSESSEE WAS NOT THE OWNER O F THE PROPERTY AND THE DEVELOPMENT PERMISSION WAS NOT GRANTED IN THE ASSES SEES NAME. THE APPROVAL BY THE VADODARA MUNICIPAL CORPORATION WAS IN THE NAME OF THE ORIGINAL LAND OWNERS AND NOT IN THE NAME OF ASSESSE E. AS PER THE ASSESSING OFFICER, THE ORIGINAL LAND OWNER HAD MERE LY OBTAINED THE SERVICES OF ASSESSEE FIRM FOR DEVELOPMENT AND CONST RUCTION OF THE PROJECT. IN VIEW OF THE ASSESSING OFFICER, THE FUNDAMENTAL C ONDITION THAT THE APPROVAL MUST BE ACCORDED IN ASSESSEES NAME WAS NO T SATISFIED AND THEREFORE THE CLAIM WAS DENIED. WITHOUT PREJUDICE TO THE AFORESAID ARGUMENT IT WAS OBSERVED BY THE ASSESSING OFFICER T HAT THE ASSESSEE HAD UTILIZED FSI OF 14,394 SQ.MT. AND LEFT UNUTILIZED F SI OF 27,371 SQ.MT. AND AS THE UNUTILIZED LAND WAS DISPOSED BY THE ASSESSEE ALONG WITH THE TENEMENTS TO PROSPECTIVE BUYERS, THE PROFIT BOOKED FROM SALE OF 27,371 SQ.MT. WAS STATED TO BE OUTSIDE THE AMBIT OF PROVIS IONS OF SECTION 80IB (10) AS IT WAS NOT THE PROFIT DERIVED FROM ACTIVITI ES OF DEVELOPMENT AND CONSTRUCTION. IN ESSENCE DEDUCTION U/S.80IB (10) WA S DENIED ON ACCOUNT OF OWNERSHIP NOT BEING IN THE NAME OF THE APPELLANT , AND ION THE ALTERNATIVE THE DEDUCTION WAS LIMITED TO SALE OF UN UTILIZED FSI OF 14394 SQ.MT. ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 4 - 3. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD.CIT (A). THE LD.CIT (A) HAS DECIDED THE ISSUE IN FAVOUR OF ASSESSEE IN RESPECT OF TWO OBJECTIONS RAISED BY THE AO, I.E. TH AT THE ASSESSEE HAS NOT PURCHASED THE LAND IN ITS NAME AND ON THE ISSUE THA T THERE IS SALE OF UNUTILIZED FSI. IN PARA 3.2.3 OF HIS ORDER, IT WAS HELD BY TH E LD.CIT (A) THAT THE DISALLOWANCE OF DEDUCTION U/S.80-IB (10) MADE BY TH E AO ON THESE TWO ISSUES IS NOT CORRECT. HE DIRECTED HIM THAT THE DISALLOWANCE IS TO BE DELETED ON THESE TWO ISSUES. AGAINST THIS DIRECTION OF THE LD.CIT (A), THE REVENUE IS IN APPEAL BEFORE US. 4. AFTER DELETING THE DISALLOWANCE OF DEDUCTION U/S .80-IB (10) OF THE ACT ON TWO ISSUES REFERRED TO BY THE AO, IT WAS NOTED BY T HE LD.CIT (A) THAT IN ADDITION TO THESE TWO ISSUES, SOME OTHER FACTS HAD COME TO L IGHT IN THE COURSE OF APPELLATE PROCEEDINGS WHICH HAVE BEARING ON THE ALLOWABILITY OF DEDUCTION U/S.80-IB (10) OF THE ACT. THE ISSUES RAISED BY THE LD.CIT (A) AR E THESE THAT THE COMMERCIAL AREA UNDER THE TWO PROJECTS EXCEEDS THE SPECIFIED L IMIT AND THE PROJECT WAS NOT COMPLETED WITHIN DUE DATE. HE HAS NOTED ON PAGE-5 OF HIS ORDER THAT TWO SCHEMES UNDERTAKEN BY THE ASSESSEE VIZ. SHREEJI BUN GALOWS AND SHREE HARI DARSHAN BUNGALOWS WERE APPROVED BY THE LOCAL AUTHOR ITY ON 24/06/2005 AND 04/07/2005 RESPECTIVELY. HE HAD FURTHER NOTED THAT ACCORDINGLY, THESE SHOULD BE COMPLETED BEFORE 31/03/2008. HE HAS ALSO NOTED THA T THE COMMERCIAL AREA SHOULD BE 2000 SQ.FT. OR 5% OF THE AGGREGATE BUILT- UP AREA OF THE PROJECTS, WHICHEVER IS LESS, FOR EACH PROJECT. IN THIS REGAR D, HE HAS FURTHER NOTED AT PAGE-9 OF HIS ORDER THAT SHREE HARI DARSHAN BUNGALOWS SCHE ME WAS SANCTIONED WITH COMMERCIAL AREA OF 978.36 SQ.METERS WHICH IS 6.40% OF AGGREGATE BUILT-UP AREA OF THE SCHEME AND THEREFORE, THE APPROVED COMMERCIA L AREA IS MORE THAN THE ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 5 - SPECIFIED LIMIT, BOTH IN ABSOLUTE TERMS (2000 SQ.FT .) AND IN PERCENTAGE TERMS (5% OF AGGREGATE BUILT-UP AREA). IT WAS A SUBMISSION O F THE ASSESSE BEFORE THE LD.CIT (A) THAT THE ASSESSE HAS NOT ACTUALLY DONE ANY CONS TRUCTION IN RESPECT OF THE APPROVED COMMERCIAL AREA AND HENCE, THE CONDITION O F SECTION 80-IB (10) (D) IS NOT VIOLATED BUT IT WAS HELD BY THE LD.CIT (A) THAT THIS CONTENTION IS NOT ACCEPTABLE. HIS REASONING IS THIS THAT THE NON-CON STRUCTION NOW CANNOT BE TAKEN TO MEAN THAT THE ASSESSEE HAD COMPLIED WITH CLAUSE (D). HE HAS NOTED THAT THE ASSESSEE CAN ALWAYS CONSTRUCT THE COMMERCIAL AREA A T A LATER DATE. HE HAS GIVEN A FINDING THAT IN FACT, THIS ALSO LEADS TO NON-COMP LIANCE OF THE CONDITION OF CLAUSE (A) (III) OF SECTION 80-IB (10) OF THE ACT T HAT THE PROJECT SHOULD BE COMPLETED BEFORE 31/03/2008. HE HAS ALSO NOTED THA T NOT ONLY THE COMMERCIAL AREA BUT ALSO THE 25 RESIDENTIAL APARTMENTS ON 2 ND /3D FLOORS OF THE TWO BLOCKS ABOVE THESE SHOPS ARE ALSO NOT CONSTRUCTED BY THE A SSESSEE AND THEREFORE, THE PROJECT IS NOT COMPLETE AND NO COMPLETION CERTIFICA TE FOR THE SHOPS AS WELL AS RESIDENTIAL FLATS HAVE BEEN OBTAINED BEFORE 31/03/ 2008. 4.1. REGARDING SHREE HARI DARSHAN BUNGALOWS SCHEME, IT WAS NOTED BY HIM THAT THIS SCHEME WAS SANCTIONED WITH SHOPS OF 1081. 12 SQ.METERS, I.E.14.46% OF THE AGGREGATE BUILT-UP AREA OF THE PROJECT AND, THE REFORE, THERE IS VIOLATION OF CLAUSE(D) OF SECTION 80-IB(10) OF THE ACT. THEREAF TER, IT WAS NOTED BY THE LD.CIT (A) THAT THE CLAIM OF THE ASSESSEE THAT THEY HAVE S OLD OFF THE LAND ON WHICH COMMERCIAL CONSTRUCTION WAS TO BE DONE IS NOT ACCEP TABLE. REASONING GIVEN BY HIM IS THIS THAT THE PROJECT WAS SANCTIONED WITH CO MMERCIAL AREA MORE THAN SPECIFIED LIMITS AND, HENCE, THE PROJECT VIOLATES C LAUSE (D) AS WELL AS VIOLATES THE COMPLETION TIME CLAUSE. ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 6 - 4.2. IN ADDITION TO ABOVE TWO OBJECTIONS, THE LD.CI T (A) HAS RAISED ONE MORE OBJECTION THAT THE ASSESSEE HAS SOLD THE LAND TO TH E UNIT HOLDERS SEPARATELY AND HAS DONE THE CONSTRUCTION OF UNITS UNDER SEPARATE A GREEMENT/CONTRACT AND, THEREFORE, THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTI ON U/S.80-IB(10) OF THE ACT BECAUSE AS PER LD.CIT(A), PROFIT EARNED BY THE ASSE SSEE IN RESPECT OF SALE OF LAND IS NOT ELIGIBLE FOR DEDUCTION U/S.80-IB(10) OF THE ACT AND SIMILARLY, THE PROFIT EARNED BY THE ASSESSEE FOR CONSTRUCTION ACTIVITIES IS NOT ELIGIBLE FOR DEDUCTION U/S.80-IB(10) BECAUSE THE ASSESSEE IS DOING THE CON STRUCTION AS A CONTRACTOR FOR A WORK AND NOT AS A BUILDER OR DEVELOPER AND, THEREFO RE, THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION U/S.80-IB(10) OF THE ACT. AGAINST TH ESE OBJECTIONS OF LD.CIT (A), THE ASSESSE IS IN APPEAL BEFORE US. 5. IT WAS SUBMITTED BY THE LD.AR OF THE ASSESSEE BE FORE US THAT REGARDING OBJECTIONS OF THE AO WHICH ARE DECIDED BY THE LD.CI T (A) IN FAVOUR OF ASSESSEE, RELIANCE IS PLACED ON THE ORDER OF THE LD.CIT (A) A ND ON THE JUDGEMENT OF HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF CIT VS. RADHE DEVELOPERS REPORTED AT (2012) 341 ITR 403(GUJ.). 5.1. REGARDING VARIOUS NEW OBJECTIONS RAISED BY THE LD.CIT (A), IT WAS SUBMITTED BY THE AR OF THE ASSESSEE THAT THESE OBJE CTIONS ARE NOT VALID. REGARDING THE FIRST OBJECTION THAT COMMERCIAL AREA AS PER THE PROJECT IS MORE THAN THE SPECIFIED LIMIT AS PER CLAUSE(D) OF SECTIO N 80-IB(10) OF THE ACT, IT WAS SUBMITTED THAT SINCE NO ACTUAL CONSTRUCTION WAS DON E BY THE ASSESSEE OF THE COMMERCIAL AREA AND THE CONCERNED LAND WAS SOLD OUT , THERE IS NO VIOLATION OF CLAUSE(D) OF SECTION 80-IB(10) OF THE ACT BECAUSE T HE PROFIT OF THE ASSESSEE DOES ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 7 - NOT INCLUDE ANY PROFIT IN RESPECT OF ANY SALE OF CO MMERCIAL AREA OF THE PROJECT. REGARDING THE COMPLETION OF THE PROJECT WITHIN THE SPECIFIED TIME AS PER SECTION 80-IB(10)(A)(III) OF THE ACT, IT WAS SUBMITTED THAT IN THIS REGARD, THE OBJECTION OF THE LD.CIT(A) IS ON THIS BASIS THAT SINCE THE COMME RCIAL AREA WAS NOT CONSTRUCTED BY THE ASSESSEE, THE PROJECT WAS NOT COMPLETED. HE SUBMITTED THAT WHEN THE CONCERNED LAND AREA ON WHICH COMMERCIAL PLACE/SHOPS WERE TO BE BUILT HAVE BEEN SOLD OUT, THERE IS NO SCOPE OF COMPLETING OR CONSTRUCTING THE SHOPS AND FLATS THEREUPON AND, THEREFORE, IT CANNOT BE SAID T HAT THE PROJECT IS NOT COMPLETE. 5.2. REGARDING THE 3 RD OBJECTION THAT THE ASSESSE HAS SOLD LAND TO THE UN IT HOLDERS SEPARATELY AND HAS DONE THE CONSTRUCTION UN ITS UNDER A PROJECT AGREEMENT/CONTRACT, IT WAS SUBMITTED THAT IT IS A J OINT ACTIVITY ALTHOUGH THE AGREEMENT AND LAND SALE-DEED ARE EXECUTED SEPARATEL Y, BUT FOR THIS REASON ALONE, IT CANNOT BE SAID THAT THE ASSESSEE IS NOT A BUILDE R OR A DEVELOPER. HE PLACED RELIANCE ON THE FOLLOWING TRIBUNAL DECISIONS:- SL.NO(S) DECISION IN THE CASE OF. REPORTED IN. 1. DCIT VS. SMR BUILDERS (P.)LTD. (2012)24 TAXMAN.C OM 194 (HYD.) 2. SKY BUILDERS & DEVELOPERS VS. ITO (2011)14 TAXMAN.COM 78 (INDORE) 3. M/S.VARDHMAN BUILDERS AND DEVELOPERS VS. ITO ITA NO.559/IND/2010 DATED 09/05/2012 4. RAGHAVA ESTATES VS. DY.CIT ITA NOS.248 & 49/VIZAG/2009 DATED 04/08/2011 5.2. HE SUBMITTED THAT IN THE CASE OF VARDHMAN BUIL DERS & DEVELOPERS (SUPRA) ALSO, THE ASSESSEE HAD ENTERED INTO A SEPAR ATE AGREEMENT FOR SALE OF LAND AND SEPARATE AGREEMENT FOR CONSTRUCTION OF HOUSING ON SUCH LAND AND UNDER ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 8 - THESE FACTS, IT WAS HELD BY THE TRIBUNAL IN THAT CA SE THAT MERELY BECAUSE OF TWO SEPARATE AGREEMENTS, THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S.80-IB (10) OF THE ACT CANNOT BE DECLINED IF OTHER CONDITIONS ARE BEING SATISFIED. 5.3. HE FURTHER SUBMITTED THAT IN THE CASE OF DCIT VS. SMR BUILDERS (P) LTD. (SUPRA) ALSO, THE FACTS WERE THAT THE ASSESSEE HAD SOLD FLATS IN A SEMI-FINISHED STAGE. IN THAT CASE, THE AO HAD NOTED THAT AS PER THE SALE-DEED, THE ASSESSEE- COMPANY HAS SOLD UNDIVIDED SHARE OF LAND WITH SUPER -STRUCTURE OF SEMI-FINISHED BUILT-UP AREA FOR A CERTAIN CONSIDERATION. THE AO HELD THAT THE SEMI-FINISHED STRUCTURE HAS NEVER BEEN CONSIDERED AS A RESIDENTIA L UNIT. IT WAS ALSO NOTED BY THE AO IN THAT CASE THAT ON THE SAME DATE WHEN THE SALE DEED WAS EXECUTED, A CONSTRUCTION AGREEMENT WAS ALSO ENTERED INTO WI TH THE TRANSFEREE FOR FURTHER CONSTRUCTION OF THE SAME FLATS BY THE BUILDER COMPA NY ITSELF. HE SUBMITTED THAT THE FACTS IN THE PRESENT CASE ARE SIMILAR. HE ALSO POINTED OUT THAT IN THAT CASE, IT WAS HELD BY THE TRIBUNAL THAT THE STAND OF THE REVE NUE WITH REGARD TO THE SEMI- FINISHED CONDITION OF THE FLATS IS DEVOID OF ANY ME RIT IN AS MUCH AS WHAT IS SOUGHT TO BE CONSTRUCTED AND SOLD BY THE ASSESSEE I S A RESIDENTIAL UNITS AND WHAT IS SOUGHT TO BE PURCHASED BY THE BUYER IS THE OWNER SHIP OF THE SPECIFIED UNIT AND REGISTRATION OF FLAT IN SEMI-FINISHED CONDITION IS ONLY TO FACILITATE THE CONVENIENCE OF THE PARTIES AND AGREEMENT FOR DEVELO PMENT AND COMPLETION OF BALANCE WORK IN RELATION TO THE FLATS IS ONLY AN IN CIDENTAL FORMALITY AND THIS CANNOT BE VIEWED AS FATAL TO THE CLAIM OF THE ASSES SEE FOR DEDUCTION U/S.80- IB(10) OF THE ACT. IT WAS ALSO HELD BY THE TRIBUNA L THAT THE ENTIRE WORK FROM THE STAGE OF THE COMMENCEMENT TO THE STAGE OF MAKING TH E RESIDENTIAL UNIT HABITABLE HAVE BEEN CARRIED OUT BY THE ASSESSEE ONLY AND, THE REFORE, ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S.80-IB(10) OF THE ACT. ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 9 - 6. AS AGAINST THIS, LD.DR OF THE REVENUE SUPPORTED THE ASSESSMENT ORDER WITH REGARD TO THE RELIEF ALLOWED BY THE LD.CIT (A) AND SUPPORTED THE ORDER OF LD.CIT (A) WITH REGARD TO NEW OBJECTIONS RAISED BY LD.CIT (A). REGARDING THE RELIANCE PLACED BY THE LD.AR OF THE ASSESSEE ON THE JUDGEMENT OF HONBLE JURISDICTIONAL HIGH COURT RENDERED IN THE CASE OF C IT VS. RADHE DEVELOPERS (SUPRA), IT WAS SUBMITTED BY HIM THAT THIS JUDGEMEN T IS NOT APPLICABLE IN THE FACTS OF THE PRESENT CASE. HE SUBMITTED WRITTEN SU BMISSIONS CONTAINING TWO PAGES WHICH ARE REPRODUCED BELOW FOR THE SAKE OF RE ADY REFERENCE:- OFFICE OF THE SENIOR DEPARTMENTAL REPRESENTATIVE, *D' BENCH, ITAT-I, 2 ND FLOOR, NEPTUNE TOWER, OPP. NEHRU BRIDGE, __________ASHRAM ROAD, AHMEDABAD. __________________________ NO. SR. D.R./ITAT-I/SD/'D 1 BENCH/2013-14 DATE: 08.08.2013 TO THE HON'BLE MEMBERS, 'D' BENCH, ITAT, AHMEDABAD. SIRS, SUB: ITA NO. 1221/AHD/2012 IN THE CASE OF M/S. SATS ANG DEVELOPERS FOR A.Y. 2008-09 - REG. LAST DATE OF HEARING: 01.08.2013. NEXT DATE OF HEARING: 13.08.2013 KINDLY REFER TO THE ABOVE. 2. THE ABOVE APPEAL CAME UP FOR HEARING ON 01.08.20 13 AS A PART HEARD MATTER. IN VIEW OF THE REVISED WORK ALLOCATION OF DEPARTMENTAL REPRESE NTATIVE BEFORE ITAT AS DECIDED BY THE CBDT THE CASE WAS ASSIGNED TO ME. SINCE, THE CASE W AS RECEIVED BY ME ON THE PREVIOUS DAY I HAD IMPLORED YOUR HONOUR TO GRANT ME TIME FOR PREPA RING THE CASE AND ARGUING THE SAME. YOUR HONOURS WERE KIND ENOUGH TO ALLOW ME TO FILE T HE WRITTEN SUBMISSION IN THE CASE BY08.08.2011 3. ON GOING TO THE CIT(A)'S ORDER IT IS SEEN THAT T HE CIT(A) HAS ALLOWED THE APPEAL FILED BY THE ASSESSEE RELYING ON THE DECISION OF THE HON'BLE JURISDICTIONAL HIGH COURT GIVEN IN THE CASE OF RADHE DEVELOPERS REPORTED IN 341 ITR 403 (GUJ.). ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 10 - ON GOING THROUGH THE JUDGMENT DELIVERED BY THE HON' BLE HIGH COURT IT IS SEEN THAT THE HON'BLE HIGH COURT HAS RECORDED IN PARA 31 OF ITS O RDER AS UNDER: 31. NEITHER THE PROVISIONS OF SECTION 80IB NOR ANY OTHER PROVISIONS CONTAINED IN OTHER RELATED STATUTES WERE BROUGHT TO OUR NOTICE T O DEMONSTRATE THAT OWNERSHIP OF THE LAND WOULD BE A CONDITION PRECEDENT FOR DEVELOP ING THE HOUSING PROJECT. IT WAS PERHAPS NOT EVEN THE CASE OF THE REVENUE THAT UNDER THE OTHER LAWS GOVERNING CONSTRUCTION IN URBAN AND SEMI-URBAN AREAS, THERE W AS ANY SUCH RESTRICTION.' THE CASE RECORDS OF THE ASSESSEE WHO IS BEING ASSES SED IN BARODA HAS BEEN REQUISITIONED. HOWEVER, THE A.O. ON ACCOUNT OF HIS PREOCCUPATION C OULD NOT SEND THE RECORDS AS ANTICIPATED BY THIS OFFICE. THESE RECORDS HAVE JUST BEEN RECEIV ED YESTERDAY. MOREOVER, IT HAS BEEN INFORMED THAT AS PER THE GENERAL DEVELOPMENT REGULA TIONS ISSUED UNDER THE PROVISIONS OF THE GUJARAT TOWN PLANNING AND URBAN DEVELOPMENT ACT, 19 76, IT IS MANDATORY THAT THE APPLICANT WHO FILES AND OBTAINS THE DEVELOPMENT PER MISSION FROM THE REGULATOR MUST BE OWNER OF THE LAND. A COPY OF THE RULES ISSUED BY VADODARA MUNICIPAL CO RPORATION IS BEING OBTAINED FOR FILING BEFORE YOUR HONOUR. FURTHER, TH E A.O. HAS ALSO INFORMED THAT AS DIRECTED BY THE CIT-I, BARODA ADDITIONAL GROUNDS OF APPEAL A ND ADDITIONAL EVIDENCE HAVE BEEN FILED BY HIM BEFORE THE HON'BLE TRIBUNAL VIDE LETTER NO. BRD/WD-2(3)/APPEAL-ITAT/SD/2013-14 DATED 06.08.2013 ADDRESSED TO THE ASSISTANT REGISTR AR, INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD. A LETTER BEARING NO. 4(L)/MISC/VOB/12-13 DATED 20.03.2013 OF THE VALUATION OFFICER, INCOME TAX DEPARTMENT, BARODA ADDRESSED TO THE INCOME TAX OFFICER, WARD - 2(3), BARODA IS ALSO ENCLOSED HEREWITH FOR YOUR KIND PERU SAL WHEREIN IT HAS BEEN FOUND BY THE VALUATION OFFICER THAT THE BUILT-UP AREA OF THE FLATS CONSTRUCTED BY THE ASSES SEE EXCEEDS THE MAXIMUM LIMIT OF 1500 SQ. FT. FIXED BY THE SECTION 80IB. SR. NO. DESCRIPTION BUILT UP AREA IN SQ. FT 1 TYPE-A 1883.73 2 TYPE-B 1651.90 3 TYPE-C 1380.58 4. UNDER THE CIRCUMSTANCES, THE DESIRED SUBMISSION CANNOT BE SUBMITTED AS PER THE STIPULATED DATE. YOUR HONOURS ARE THEREFORE REQUESTED TO KINDL Y GRANT FURTHER TIME UP TO 23.08.2013 FOR FILING THE REQUIRED SUBMISSION AS LOT OF PAPERS ARE REQUIRED TO BE SEEN AND RELEVANT FACTS ASCERTAINED. THANKING YOU AN ANTICIPATION. YOURS FAITHFULLY, SD/- (K.C. MATHEWS) SENIOR DEPARTMENTAL REPRESENTATIVE, 'D' BENCH, ITAT-I, AHMEDABAD ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 11 - 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW AND THE JUDGMENTS CITED BEFORE US. FIRST, WE DECIDE THE AP PEAL FILED BY THE REVENUE, I.E. ITA NO.1221/AHD/2012. AS PER THIS APPEAL, THE REVE NUES CHALLENGE IS THAT THE LD.CIT(A) WAS NOT JUSTIFIED IN GRANTING RELIEF TO T HE ASSESSEE BY FOLLOWING THE TRIBUNAL DECISION RENDERED IN THE CASE OF M/S.SHAKT I CORPORATION & OTHERS IN ITA NO.1503/AHD/2008 DATED 07/11/2008. NOW THE JUD GEMENT OF HONBLE GUJARAT HIGH COURT IS AVAILABLE ON THIS ISSUE, I.E. THE JUDGEMENT RENDERED IN THE CASE OF CIT VS. RADHE DEVELOPERS (SUPRA). REGARDIN G THIS JUDGMENT OF HONBLEJURISDICTIONAL HIGH COURT, IT WAS SUBMITTED BY THE LD.DR OF THE REVENUE THAT THIS JUDGMENT IS NOT APPLICABLE BECAUSE IN THA T JUDGEMENT OF HONBLE GUJARAT HIGH COURT, IT WAS OBSERVED VIDE PARAGRAPH NO.31 OF THE JUDGEMENT THAT NO PROVISION CONTAINED IN OTHER RELATED STATUTES WE RE BROUGHT TO THE NOTICE OF HONBLE GUJARAT HIGH COURT TO DEMONSTRATE THAT OWNE RSHIP OF THE LAND WOULD BE A CONDITION PRECEDENT FOR DEVELOPING THE HOUSING PR OJECT. HE SUBMITTED THAT IN THE PRESENT CASE, THE REVENUE WANTS TO BRING THIS O N RECORD THAT AS PER GUJARAT TOWN PLANNING AND URBAN DEVELOPMENT ACT, 1976 AND THE REGULATIONS FRAMED THEREUNDER, IT IS NECESSARY THAT OWNERSHIP OF THE L AND IS A CONDITION PRECEDENT FOR DEVELOPING THE HOUSING PROJECT. IN THIS REGARD , WE FIND THAT IN THIS VERY JUDGEMENT OF HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF CIT VS. RADHE DEVELOPERS (SUPRA), IN PARA-19, IT WAS NOTED BY THE HONBLE GUJARAT HIGH COURT THAT THE LD. COUNSEL FOR THE ASSESSE SUBMITTED THAT UNDER THE GUJARAT TOWN PLANNING AND URBAN DEVELOPMENT ACT AS ALSO THE GE NERAL DEVELOPMENT ACT AND CONTROL REGULATIONS APPLICABLE TO THE CITY OF VADODARA, THERE IS NO REQUIREMENT THAT ONLY THE OWNER CAN DEVELOP A HOUSI NG PROJECT ON ANY LAND. THIS GOES TO SHOW THAT THIS ACT AND REGULATIONS ON WHICH OUR ATTENTION IS DRAWN ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 12 - BY LD.DR OF THE REVENUE HAS BEEN VERY MUCH AVAILABL E BEFORE HONBLE GUJARAT HIGH COURT IN THE CASE OF CIT VS. RADHE DEVELOPERS (SUPRA), AND EVEN AFTER NOTING THE SAME, IT IS OBSERVED BY THE HONBLE GUJA RAT HIGH COURT IN THAT CASE THAT NO PROVISION OF ANY OTHER RELATED STATUES WAS BROUGHT TO THEIR NOTICE TO DEMONSTRATE THAT OWNERSHIP OF THE LAND WOULD BE A C ONDITION PRECEDENT FOR DEVELOPING THE HOUSING PROJECT. THEREFORE, THE ARG UMENT OF THE LD.DR BEFORE US BY PLACING RELIANCE ON THIS ACT AND REGULATION HAS NO MERIT BECAUSE THE SAME WERE DULY CONSIDERED BY HONBLE GUJARAT HIGH COURT IN THE CASE OF RADHE DEVELOPERS (SUPRA). THEREFORE, THIS ASPECT OF THE MATTER AS TO WHETHER THE PROJECT WAS CONSTRUCTED ON A LAND OWNED BY THE ASSE SSEE OR NOT IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE JUDGEMENT OF HONBLE GUJARAT HIGH COURT RENDERED IN THE CASE OF RADHE DEVELOPERS (SUP RA) AND NO INTERFERENCE IS CALLED FOR IN THE ORDER OF THE LD.CIT (A) ON THIS A SPECT OF THE MATTER. 7.1. REGARDING SECOND ASPECT, I.E. REGARDING SALE O F UNUTILIZED FSI, IT IS NOTED BY THE LD.CIT(A) THAT THIS ASPECT IS COVERED IN FAV OUR OF THE ASSESSEE BY THE TRIBUNAL DECISION RENDERED IN THE CASE OF ITO VS. S HAKTI CORPORATION BARODA IN ITA NO.1503/AHD/2008 DATED 07/11/2008. NO DIFFEREN CE IN FACTS HAS BEEN POINTED OUT BY THE LD.DR OF THE REVENUE IN THE PRES ENT CASE AND IN THE CASE OF SHAKTI CORPORATION (SUPRA). THEREFORE, WE DO NOT F IND ANY REASON TO TAKE A CONTRARY VIEW THAN TAKEN BY THE LD.CIT (A) IN THE P RESENT CASE ON THIS ASPECT. HENCE, BOTH THE ASPECTS ARE DECIDED IN FAVOUR OF TH E ASSESSEE AND THE GROUNDS RAISED BY THE REVENUE ARE REJECTED. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 13 - 9. NOW, WE TAKE UP THE APPEAL FILED BY THE ASSESSEE IN QUANTUM PROCEEDINGS, I.E. ITA NO.1011/AHD/2012. 9.1. IN THIS APPEAL, WE HAVE TO EXAMINE THE VALIDIT Y OF VARIOUS OBJECTIONS RAISED BY THE LD.CIT (A). THE FIRST OBJECTION IS T HIS AS TO WHETHER THE COMMERCIAL AREA UNDER THE TWO PROJECTS EXCEEDS THE SPECIFIED LIMIT AND THE SECOND ISSUE IS THIS AS TO WHETHER THE PROJECTS WER E COMPLETED OR NOT WITHIN THE DUE DATE. IN THIS REGARD, WE FIND THAT IT WAS SUBM ITTED BY THE ASSESSE BEFORE THE LD.CIT (A) THAT THE ASSESSE HAS NOT CONSTRUCTED THE SHOPS AND THE RELEVANT LAND ON WHICH THE SHOPS WERE TO BE CONSTRUCTED IN BOTH T HE PROJECTS WERE SOLD OUT. NO DEFECT HAS BEEN POINTED OUT BY THE LD.CIT (A) IN THESE CONTENTIONS OF THE ASSESSEE. HE HAS REJECTED THE CONTENTIONS ON THIS BASIS THAT THE PROJECT WAS SANCTIONED WHICH COMMERCIAL AREA OF MORE THAN SPECI FIED LIMITS AND, THEREFORE, THERE IS VIOLATION OF THE CONDITIONS OF CLAUSE (D) OF SECTION 80IB (10) AND IN CONSEQUENCE, THERE IS VIOLATION OF THE CONDITIONS I N THE CASE (A) (III) OF SECTION 80IB (10) OF THE ACT BECAUSE THE PROJECT IS NOT COM PLETED WITHIN THE DUE DATE. WE DO NOT FIND ANY MERIT IN THESE OBJECTIONS OF LD. CIT(A) BECAUSE IN OUR CONSIDERED OPINION, WHAT IS RELEVANT IS THIS AS TO WHETHER THE BUILT-UP AREA OF COMMERCIAL SPACE ACTUALLY CONSTRUCTED BY THE ASSESS EE EXCEEDS THE PRESCRIBED LIMIT OR NOT BECAUSE IF THE BUILT-UP AREA OF THE CO MMERCIAL SPACE AS PER THE APPROVED PROJECT WAS LESS BUT THE ACTUAL CONSTRUCTI ON OF COMMERCIAL AREA IS MORE THAN ALSO, WE HAVE TO GO BY THE ACTUAL CONSTRU CTION DONE BY THE ASSESSEE AND NOT BY THE COMMERCIAL AREA APPROVED IN THE PROJ ECT. IN OUR CONSIDERED OPINION, WE HAVE TO GO BY ACTUAL CONSTRUCTION DONE BY THE ASSESSEE OF COMMERCIAL AREA. IN THE PRESENT CASE, THIS IS AN UNDISPUTED FACT THAT NO SHOPS WERE, IN FACT, CONSTRUCTED BY THE ASSESSEE AND THER E IS NO SCOPE FOR CONSTRUCTION ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 14 - OF SUCH SHOPS IN FUTURE ALSO BECAUSE THE LAND ON WH ICH THE SHOPS WERE TO BE CONSTRUCTED HAD BEEN SOLD BY THE ASSESSEE. THEREF ORE, THIS OBJECTION OF LD.CIT (A) IS DEVOID OF ANY MERIT. REGARDING SECOND OBJEC TION, I.E. COMPLETION OF PROJECT WITHIN THE TIME ALSO, WE DO NOT FIND ANY ME RIT IN THE ORDER OF THE LD.CIT (A) BECAUSE WHATEVER AREA WAS LEFT WITH THE ASSESSE E AFTER SALE OF LAND IN RESPECT OF SHOPS, CONSTRUCTION WAS COMPLETED BY THE ASSESSE E AS PER THE APPROVED PROJECT LATEST BY 04.03.2008 AS PER COPY OF VARIOUS COMPLETION CERTIFICATES FOR BOTH THE PROJECTS AVAILABLE ON PAGES 54 TO 58 OF THE PAPER BOOK AND THEREFORE, IT IS EVIDENT THAT THE PROJECT HAS BEEN COMPLETED BEFO RE THE DUE DATE I.E. 31.03.2008 AND HENCE, THIS OBJECTION IS ALSO DEVOID OF ANY MERIT. 9.2. NOW WE TAKE UP THE THIRD AND LAST OBJECTION OF LD.CIT (A) THAT THE ASSESSE HAD SOLD THE LAND SEPARATELY AND UNDERTOOK THE CONS TRUCTION WORK AS PER A SEPARATE AGREEMENT AND, THEREFORE THE ASSESSEE IS N OT A BUILDER OR A DEVELOPER BUT A LAND DEALER AND CONTRACTOR. IN THIS REGARD, IN OUR CONSIDERED OPINION, THE ISSUE INVOLVED IS SQUARELY COVERED IN FAVOUR OF ASS ESSEE BY THE DECISION OF ITAT INDORE BENCH RENDERED IN THE CASE OF M/S.VARDHMAN B UILDERS AND DEVELOPERS VS. ITO (SUPRA). IT IS NOTED BY THE TRIBUNAL IN TH AT CASE THAT THE ASSESSE HAD ENTERED INTO AN AGREEMENT FOR A SALE OF LAND AND A SEPARATE AGREEMENT FOR CONSTRUCTION OF THE HOUSE ON THE LAND AND, THEREFOR E, THE FACTS ARE SIMILAR. UNDER THESE FACTS, IT WAS HELD BY THE TRIBUNAL IN THAT CA SE THAT THE CLAIM OF THE ASSESSE FOR DEDUCTION U/S.80-IB (10) OF THE ACT CANNOT BE D ECLINED IF OTHER CONDITIONS ARE BEING SATISFIED. SIMILARLY, IN THE CASE OF DCI T VS. SMR BUILDERS (P.) LTD. (SUPRA) ALSO, THE ASSESSE SOLD THE LAND ALONG WITH SEMI-FINISHED STRUCTURE TO THE BUYERS AND AS PER SEPARATE AGREEMENT, AGREED FOR CO NSTRUCTION FOR COMPLETION OF BALANCE WORK. HENCE, THE FACTS OF THIS CASE ARE AL SO SIMILAR BECAUSE IN THAT CASE ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 15 - ALSO, THE LAND WAS SOLD SEPARATELY ALONG WITH PARTI AL AND UNFINISHED CONSTRUCTION OF FLATS AND, THEREAFTER, CONSTRUCTION AGREEMENT WA S ENTERED INTO TO CARRY OUT THE BALANCE CONSTRUCTION WORK AND UNDER THESE FACTS, IT WAS HELD BY THE TRIBUNAL IN THAT CASE THAT SUCH AGREEMENT FOR CONSTRUCTION TO C OMPLETE THE BALANCE WORK IS ONLY AN INCIDENTAL FACILITATION TO PROTECT INTEREST OF THE PARTIES AND THEREFORE, THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S.80-IB(10) OF THE ACT. SIMILARLY, IN THE CASE OF RAGHAVA ESTATES VS. DY.CIT (SUPRA) ON WHICH RELI ANCE WAS PLACED BY THE LD.AR OF THE ASSESSEE, THE FACTS ARE SIMILAR. IN T HAT CASE ALSO, THE ASSESSEE HAD SOLD THE PLOTS SEPARATELY AND THEREAFTER, CONSTRUCT ED THE HOUSES AND UNDER THESE FACTS, THE REVENUE HELD THAT THE ASSESSEE HAS TO BE CONSIDERED AS A MERE CONTRACTOR AND, THEREFORE, THE ASSESSEE IS NOT ELIG IBLE FOR DEDUCTION U/S.80-IB (10) OF THE ACT. THIS GOES TO SHOW THAT THE FACTS IN THAT CASE WERE IDENTICAL. IN THAT CASE, IT WAS NOTED BY THE TRIBUNAL THAT THE AS SESSEE HAD CHOSEN TO REGISTER THE PLOT IN THE NAME OF THE BUYER ON PAYMENT OF SPE CIFIED AMOUNT IN ORDER TO ACHIEVE COST SAVING AND TO ENSURE RELIABILITY AND T HEREAFTER, THE ASSESSEE HAD PROCEEDED TO CONSTRUCT THE HOUSE AS PER BUILDING PL AN OBTAINED IN THE NAME OF THE PLOT-OWNERS ON PAYMENT OF SUBSEQUENT INSTALLMEN TS. IT IS ALSO NOTED THAT THE ASSESSEE HAD ALSO DEVELOPED VARIOUS PUBLIC AMENITIE S WITHIN THE PROJECT. THEREAFTER, IT WAS HELD BY THE TRIBUNAL THAT ON A T OTALITY OF A FACT, THE TRIBUNAL IS OF THE VIEW THAT THE ASSESSEE HAS UNDERTAKEN DEVELO PING AND BUILDING HOUSING PROJECTS AS PER THE SCHEME PROVIDED IN SECTION 80-I B (10) OF THE ACT. 9.3. SINCE THE FACTS IN THE PRESENT CASE ARE SIMILA R TO THE FACTS IN ABOVE NOTED THREE TRIBUNAL DECISIONS, WE DO NOT FIND ANY DEFECT IN THE CONSTRUCTION IN THE PRESENT CASE AND HENCE RESPECTFULLY FOLLOWING THESE DECISIONS, WE DECIDE THE ISSUE IN FAVOUR OF THE ASSESSEE. THERE IS NO OTHE R OBJECTION OF THE LD.CIT (A) ITA NOS.1011,2498(BY ASSE SSEE) & 1221/AHD/12 (BY REVENUE) M/S.SATSANG DEVELOPERS VS.ACIT ASST.YEAR 2008-09 - 16 - REGARDING ALLOWABILITY OF DEDUCTION TO THE ASSESSE U/S.80IB (10) OF THE ACT. HENCE, WE DIRECT THE AO TO GRANT THE DEDUCTION TO T HE ASSESSE U/S.80-IB (10) OF THE ACT. 10. IN THE RESULT, ASSESSEES APPEAL (ITA NO.1011/A HD/2012 STANDS ALLOWED. 11. LASTLY, WE TAKE UP THE ASSESSEES APPEAL ARISIN G OUT OF PROCEEDINGS U/S.271 (1) (C) OF THE ACT, I.E. ITA NO.2498/AHD/20 12. 11.1 IN VIEW OF OUR DECISION WITH REGARD TO THE QUA NTUM APPEALS AS PER WHICH, IT IS HELD BY US THAT THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S.80-IB (10) OF THE ACT, THE PENALTY IMPOSED BY LD.CIT (A) U/S.80-IB (1 0) OF THE ACT HAS NO LEG TO STAND. THEREFORE, WE DELETE THE PENALTY. IN THE R ESULT, THIS APPEAL OF THE ASSESSEE IS ALLOWED. 12. IN THE COMBINED RESULT, THE APPEAL OF THE REVEN UE IS DISMISSED, WHEREAS BOTH THE APPEALS OF ASSESSEE ARE ALLOWED. ORDER PRONOUNCED ON THE MENTIONED ON THE CAPTION PA GE. SD/- SD/- (MUKUL KUMAR SHRAWAT) (A. K. GAROD IA) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 12/11/2013 ORDER PRONOUNCED ON 12.11.13 SD/- SD/- JM AM (MKS) (AC) &.., .../ T.C. NAIR, SR. PS $% () *$)# $% () *$)# $% () *$)# $% () *$)#/ COPY OF THE ORDER FORWARDED TO : 1. +, / THE APPELLANT 2. (-+, / THE RESPONDENT. 3. .. / / CONCERNED CIT 4. /() / THE CIT(A)-II, BARODA 5. )23 ( , , / DR, ITAT, AHMEDABAD 6. 34 5 / GUARD FILE. $% $% $% $% / BY ORDER, -) ( //TRUE COPY/ / 6 66 6/ // / .7 .7 .7 .7 ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD