Kumar Builders Consortium, Pune V. ACIT, Pune

ITA 1164/PUN/2012

• Counselvise Citation: 116424514 RSA 2012
• Duration Of Justice: 10 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-04-2013
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Assessment Year: 2008-2009
• Appeal Filed On: 04-06-2012
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: MUKESH VERMA
• Assessee Lawyers: SUNIL PATHAK
• Keywords: Opportunity of being heard
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER , AND SHRI G.S.PANNU, ACCOUNTANT MEMBER. ITA.NO.1164/PN/2012 (ASSTT. YEAR : 2008-09) KUMAR BUILDERS CONSORTIUM, 2413, KUMAR CAPITAL, EAST STREET, 2 ND FLOOR, CAMP, PUNE. .. APPELLANT PAN: AAHFK7992A VS. ACIT, CIRCLE-4, PUNE. .. RESPONDENT AND ITA.NO.2210/PN/2012 (ASSTT. YEAR : 2009-10) KUMAR BUILDERS CONSORTIUM, 2413, KUMAR CAPITAL, EAST STREET, 2 ND FLOOR, CAMP, PUNE. .. APPELLANT PAN: AAHFK7992A VS. ITO, WARD-4(5), PUNE. .. RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK AND SHRI SUNIL PATHAK DEPARTMENT BY : SHRI MUKESH VERMA DATE OF HEARING : 20.03.2013 DATE OF PRONOUNCEMENT : 15.04.2013 ORDER PER SHAILENDRA KUMAR YADAV, JM : BOTH THESE APPEALS PERTAIN TO THE SAME ASSESSEE FO R A.YS. 2008-09 AND 2009-10, SO THEY ARE BEING DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. IN ITA.NO.1164/PN/2012 FOR A.Y. 2008-09, THE ASS ESSEE RAISED THE FOLLOWING GROUNDS: 2 1) THE LEARNED CIT(A) ERRED IN DISALLOWING THE DEDUCTI ON U/S 80IB(10) OF RS.15,30,13,661/- CLAIMED IN RESPECT OF THE PROJECT KUMAR SHANTINIKETAN ON THE GROUND THAT THE BUILT UP AREA OF A FEW RESIDENTIAL UNITS EXCEEDED 1500 SQ .FT. AND THEREFORE, THE APPELLANT WAS NOT ENTITLED TO CLAIM THE DEDUCTION. 2) THE LEARNED CIT(A) ERRED IN HOLDING THAT THE GARDEN AREA WHICH WAS IN THE EXCLUSIVE USE OF THE PARTICULAR FL AT OWNER WAS INCLUDIBLE IN THE TOTAL BUILT UP AREA AND HENCE, ONCE THE GARDEN AREA WAS INCLUDED, THE BUILT UP ARE A WAS EXCEEDING 1500 SQ.FT. AND THEREFORE, THE APPELLANT WAS NOT ENTITLED TO CLAIM THE DEDUCTION U/S 80IB(10) IN RES PECT OF THE SAID PROJECT. 3) THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE AR EA COVERED BY THE GARDEN WAS NOT TO BE INCLUDED IN THE TOTAL BUILT UP AREA AND ONCE THE SAID AREA WAS EXCLUDED, THE TOTAL BUILT UP AREA OF THE RESIDENTIAL UNITS WAS LE SS THAN 1500 SQ.FT. AND ACCORDINGLY, THE APPELLANT WAS ENTI TLED TO CLAIM THE DEDUCTION IN RESPECT OF THE PROJECT KUMAR SHANTINIKETAN. 4) WITHOUT PREJUDICE TO THE ABOVE GROUNDS, ASSUMING WI THOUT ADMITTING THAT THE BUILT UP AREA OF A FEW FLATS EXC EEDED 1500 SQ.FT., THE APPELLANT SUBMITS THAT THE DEDUCTION U/ S 80IB(10) SHOULD HAVE BEEN ALLOWED ON PROPORTIONATE BASIS IN RESPECT OF THE BALANCE FLATS WHOSE BUILT UP AREA WA S LESS THAN 1500 SQ.FT. 5) THE LEARNED CIT(A) ERRED IN DENYING THE DEDUCTION O F RS.30,13,04,843/- IN RESPECT OF THE PROJECT KUMAR K RUTI ON THE GROUND THAT THE SAID PROJECT DID NOT SATISFY TH E VARIOUS CONDITIONS LAID DOWN U/S 80IB(10). 6) THE LEARNED CIT(A) ERRED IN HOLDING THAT THE PROJEC T KUMAR KRUTI WAS NOT ENTITLED TO THE DEDUCTION U/S 80IB(10 ) ON THE FOLLOWING GROUNDS A. THE PROJECT KUMAR KRUTI WAS PART OF THE LARGER PROJ ECT KUMAR CITY AND NOT AN INDEPENDENT PROJECT AS CLAIME D BY THE APPELLANT AND ACCORDINGLY, THE DEDUCTION U/S 80 IB(10) WAS NOT ALLOWABLE. B. THE PROJECT KUMAR KRUTI WAS STARTED PRIOR TO 01.04. 2004 AND THEREFORE, THE APPELLANT SHOULD HAVE COMPLETED THE PROJECT BY 31 ST MARCH, 2008 AND SINCE THE APPELLANT DID NOT COMPLETE THE PROJECT BY THAT TIME, THE DEDUCTION U/ S 80IB(10) WAS NOT ALLOWABLE. C. THE PROJECT KUMAR KRUTI INCLUDED COMMERCIAL AREA IN EXCESS OF THE LIMIT PRESCRIBED U/S 80IB(10) AND THE REFORE, IT WAS NOT ENTITLED TO CLAIM THE DEDUCTION. 3 D. THE BUILT UP AREA OF SOME OF THE RESIDENTIAL UNITS EXCEEDED 1500 SQ.FT. AND THEREFORE, THE ASSESSEE WAS NOT ENT ITLED TO CLAIM THE DEDUCTION U/S 80IB(10). 7) THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE PR OJECT KUMAR KRUTI WAS AN INDEPENDENT PROJECT AND HAD COMPLIED W ITH ALL THE CONDITIONS OF SECTION 80IB(10) AND HENCE, THERE WAS NO REASON TO DENY THE DEDUCTION IN RESPECT OF THE PROF ITS FROM THIS PROJECT. 8) THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED THAT A. THE PROJECT KUMAR KRUTI WAS AN INDEPENDENT PROJECT AND NOT PART OF PROJECT KUMAR CITY. B. THE PROJECT KUMAR KRUTI WAS STARTED IN F.Y. 2006-07 AND WAS COMPLETED WITHIN THE TIME LIMIT PRESCRIBED U/S 80IB(10) AND THEREFORE, THERE WAS NO REASON TO DENY THE DEDU CTION ON THE GROUND THAT THE ASSESSEE FIRM DID NOT COMPLE TE THE PROJECT WITHIN THE TIME LIMIT PRESCRIBED. C. THE PROJECT KUMAR KRUTI DID NOT INCLUDE ANY COMMERCIAL AREA AND HENCE, THE ASSESSEE HAD NOT VIOLATED THE CONDITIONS LAID DOWN U/S 80IB(10). D. THE BUILT UP AREA OF THE RESIDENTIAL UNITS WAS LESS THAN 1500 SQ.FT. AND HENCE, THE ASSESSEE WAS JUSTIFIED I N CLAIMING THE DEDUCTION 9) THE LEARNED CIT(A) ERRED IN HOLDING THAT THE GARDEN ARE A WHICH WAS IN THE EXCLUSIVE USE OF THE PARTICULAR FL AT OWNER WAS INCLUDIBLE IN THE TOTAL BUILT UP AREA AND HENCE , ONCE THE GARDEN AREA WAS INCLUDED, THE BUILT UP AREA WAS EXC EEDING 1500 SQ.FT. AND THEREFORE, THE APPELLANT WAS NOT EN TITLED TO CLAIM THE DEDUCTION U/S 80IB(10) IN RESPECT OF THE SAID PROJECT. 10) THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE AR EA COVERED BY THE GARDEN WAS NOT TO BE INCLUDED IN THE TOTAL BUILT UP AREA AND ONCE THE SAID AREA WAS EXCLUDED, THE TOTAL BUILT UP AREA OF THE RESIDENTIAL UNITS WAS LESS THA N 1500 SQ.FT. AND ACCORDINGLY, THE APPELLANT WAS ENTITLED TO CLAIM THE DEDUCTION IN RESPECT OF THE PROJECT KUMAR SHANT INIKETAN. 11) WITHOUT PREJUDICE TO THE ABOVE GROUNDS, ASSUMING WI THOUT ADMITTING THAT THE BUILT UP AREA OF A FEW FLATS EXC EEDED 1500 SQ.FT., THE APPELLANT SUBMITS THAT THE DEDUCTION U/ S 80IB(10) SHOULD HAVE BEEN ALLOWED ON PROPORTIONATE BASIS IN RESPECT OF THE BALANCE FLATS WHOSE BUILT UP AREA WA S LESS THAN 1500 SQ.FT. 4 3. THE ASSESSEE IS A FIRM ENGAGED IN THE BUSINESS O F REAL ESTATE PROMOTERS AND BUILDERS. THE FIRST ISSUE IN A.Y. 20 08-09 IS WITH REGARD TO DISALLOWANCE OF DEDUCTION U/S.80IB(10) OF RS.15,30,13,661/- CLAIMED IN RESPECT OF PROJECT KUM AR SHANTINIKETAN ON THE GROUND THAT BUILT UP AREA OF F EW RESIDENTIAL UNITS EXCEEDED 1500 SQ.FT. GROUNDS NOS.1 TO 4 ARE IN RESPECT OF THIS CLAIM OF DEDUCTION U/S.80IB(10) IN RESPECT OF PROJE CT KUMAR SHANTINIKETAN. ACCORDING TO THE ASSESSING OFFICER, THE BUILT UP AREA OF TWO FLATS (NOS.3 AND 4 IN BUILDING D) EXCEEDED 1500 SQ.FT. ACCORDING TO HIM, THE AREA OF THE GARDEN SHOULD BE INCLUDED IN TOTAL BUILT UP AREA AND IF SAME IS INCLUDED, THE BUILT UP AREA OF TWO FLATS EXCEED 1500 SQ.FT. THE ASSESSING OFFICER IN PARA 6.3 HAS GIVEN VARIOUS REASONS FOR INCLUDING THE GARDEN AREA IN TO TAL BUILT UP AREA, WHICH ARE REPRODUCED AS UNDER: (A) THE GARDEN AREA ATTACHED TO THESE FLATS IS NOT ON G ROUND FLOOR BUT IT IS ON PODIUM LEVEL. THE PODIUM IS CONSTRUCTE D QUITE LIKE ANY OTHER PART OF THE BUILDING BY CEMENT CONCRETE, STEEL ETC. AND IT IS VERY MUCH BUILT UP. (B) THE GARDEN AREA IS WELL DEMARCATED AND HAS A CLEAR BOUNDARY. (C) THE GARDEN IS ATTACHED TO THE FLAT AND IS NOT OPEN FOR OTHERS TO USE. (D) THE GARDEN AREA IS COVERED/NOT TOTALLY OPEN TO SKY. (E) IT IS SOLD TO THE CUSTOMER AT A PRICE, LIKE THE TER RACE. IN VIEW OF ABOVE, THE ASSESSING OFFICER HELD THAT T HE AREA OF THE GARDEN IS TO BE INCLUDED IN TOTAL BUILT UP AREA AND ACCORDINGLY, ASSESSEE HAS NOT COMPLIED WITH THE CONDITION AS LAI D DOWN UNDER THE PROVISIONS OF SECTION 80IB(10) THAT EACH UNIT S HOULD BE LESS THAN 1500 SQ.FT. ACCORDINGLY, HE DENIED THE CLAIM OF THE ASSESSEE. 4. MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AU THORITY WHEREIN VIDE PARA 4.9 TO 4.12 DISALLOWED THE CLAIM OF THE ASSESSEE BY OBSERVING AS UNDER: 4.11 DURING THE APPELLATE PROCEEDINGS THE APPELLA NT HAS ONLY CONTENDED THAT THE INTERPRETATION OF THE A.O. IS IN CORRECT SO FAR AS THE FINDING OF THE A.O. THAT GARDEN AREA WAS NOT OPEN TO OTHERS FOR USE AND THAT THE A.O. HAD EXTRAPOLATED T HE MATTER TO 5 DISALLOW THE CLAIM OF DEDUCTION U/S 80IB(10). HOWEV ER, NO MATERIAL EVIDENCE HAS BEEN BROUGHT ON RECORD OR FIL ED DURING THE COURSE OF APPELLATE PROCEEDINGS TO PROVE ANYTHI NG CONTRARY TO THE SPECIFIC FINDINGS OF THE ASSESSING OFFICER. THE APPELLANT HAS ALSO NOT EXPLAINED OR BROUGHT ANY MATERIAL ON R ECORD TO JUSTIFY THE CLAIM AS TO HOW THE A.O. HAS EXTRAPOLAT ED THE MATTER TO DISALLOW THE CLAIM OF DEDUCTION U/S 80IB( 10). EVEN THE CONTENTION RAISED BY THE APPELLANT THAT THE FIN DING OF THE A.O. REGARDING THE GARDEN AREA BEING NOT OPEN TO OT HERS FOR USE IS NOT BACKED BY ANY EVIDENCE OR PROOF, WHATSOE VER. THE FINDINGS OF THE A.O. CLEARLY INDICATE THAT THE GARD EN AREA WAS IN THE EXCLUSIVE DOMAIN OF THE BUYER AND THE SAME H AD BEEN SOLD BY THE APPELLANT AND THUS WAS PART OF THE RESI DENTIAL UNIT SOLD BY THE APPELLANT. AS LONG AS THE TERRACE AREA IS NOT FOR EXCLUSIVE USE OF ANY PARTICULAR FLAT OWNER THERE WI LL BE NO DIFFICULTY BECAUSE IT WOULD BE TREATED AS A COMMON AREA, BUT IF IT IS EXCLUSIVE AREA IT MAY BE TREATED AS A PROJECT ION OR A BALCONY AND, THEREFORE, SUCH EXCLUSIVE AREA LIKE TE RRACE OR PROJECTION HAS TO BE CONSIDERED FOR THE PURPOSE OF THE LIMIT OF BUILT-UP AREA. THE TOTAL AREA THUS ARRIVED AT WAS A CLEAR VIOLATION OF THE CONDITION CONTAINED IN CLAUSE (C) OF SECTION 80IB(10) OF THE ACT. THE ELIGIBILITY CONDITIONS U/S 801B(10) INCLUDE, INTER ALIA , THAT THE BUILT-UP AREA SHOULD NOT EXCEED 1500 SQ. FT IN THE CONTEXT OF CITIES OTHER THAN DEL HI AND MUMBAI. THIS RESTRICTION IS APPLICABLE TO THE ENTIR E PROJECT. IF SOME OF THE RESIDENTIAL UNITS OF THE PROJECT COMPRI SED AREA EXCEEDING THE PRESCRIBED LIMIT, THE BENEFIT AS PER THE LANGUAGE OF THE SECTION CANNOT BE EXTENDED TO THE PROJECT. I N SUCH A SITUATION, IT IS DIFFICULT TO DISAGREE WITH THE FIN DINGS OF THE A.O. AND, THEREFORE, THE DISALLOWANCE OF DEDUCTION U/S 80IB(10) AMOUNTING TO RS. 15,30,13,661/- IS UPHELD. 4.12 IN VIEW OF THE ABOVE FACTS AND DISCUSSION, T HE GROUND NO. 1(C) RAISED BY THE APPELLANT IS LIABLE TO BE DI SMISSED. 5. THE STAND OF THE ASSESSEE BEFORE US IS THAT THE CIT(A) ERRED IN DISALLOWING THE DEDUCTION U/S.80IB(10) CLAIMED IN R ESPECT OF KUMAR SHANTINIKETAN ON THE GROUND THAT BUILT UP AREA OF F EW RESIDENTIAL UNITS EXCEEDED 1500 SQ.FT., AND THEREFORE, THE ASSE SSEE WAS NOT ENTITLED TO DEDUCTION. THE TOTAL NUMBER OF FLATS I N SAID PROJECT ARE 374 OUT OF WHICH OBJECTION RAISED IS ONLY PERTAININ G TO TWO FLATS IN BUILDING D. IT WAS SUBMITTED ON BEHALF OF THE AS SESSEE THAT DEFINITION OF BUILT UP AREA GIVEN IN SECTION 80IB(1 0) STATES THAT BUILT UP AREA MEANS THE INNER MEASUREMENTS OF RESIDENTIAL UNITS AS INCREASED WITH THICKNESS OF WALLS AND ALSO INCLUDE PROJECTION OF BALCONY. ACCORDING TO THE LD. AUTHORISED REPRESENT ATIVE, GARDEN 6 AREA CANNOT BE CONSIDERED AS PROJECTION OR BALCONY AND, THEREFORE, SAME SHOULD NOT BE INCLUDED IN THE TOTAL BUILT UP A REA. 6. WE ARE NOT INCLINED TO AGREE WITH THE ARGUMENTS OF THE LD. AUTHORISED REPRESENTATIVE ON THE ISSUE THAT ASSESSE E HAS NOT VIOLATED THE SIZE LIMIT OF TWO FLATS IN BUILDING D , BECAUSE GARDEN AREA WAS ATTACHED TO THE FLATS AND WAS NOT LOCATED ON THE GROUND FLOOR, BUT ON THE PODIUM LEVEL AND PODIUM WAS CONST RUCTED LIKE ANY OTHER PART OF THE BUILDING USING CEMENT, CONCRETE, STEEL, ETC., AND WAS VERY MUCH BUILT UP. GARDEN AREA WAS WELL DEMAR CATED AND HAD CLEAR BOUNDARIES. GARDEN WAS ATTACHED TO THE FLATS AND WAS NOT OPEN FOR OTHERS TO USE. FURTHERMORE, THE GARDEN AR EA HAS BEEN SOLD THE BUYERS AT PRICE JUST LIKE TERRACE. SO, WE ARE NOT INCLINED TO CONCUR WITH THE PLEADING OF THE LD. AUTHORISED REPR ESENTATIVE THAT TWO FLATS LOCATED IN BUILDING D ARE NOT EXCEEDING THE AREA AS ENVISAGED UNDER CLAUSE (A) OF SECTION 80IB(10). WE UPHOLD THE FINDING OF THE CIT(A) ON THIS ACCOUNT. 7. COMING TO THE ALTERNATIVE GROUND, INTER ALIA, AS SESSEE SUBMITTED THAT DEDUCTION SHOULD BE ALLOWED ON PROPO RTIONATE BASIS IN RESPECT OF UNITS WHOSE BUILT UP AREA IS LESS WIT HIN PRESCRIBED LIMIT APPLICABLE TO PUNE MUNICIPAL CORPORATION. IN THIS REGARD, IT WAS SUBMITTED ON BEHALF OF THE ASSESSEE THAT AS PER SECTION 80IB(10), THERE IS NO CONDITION THAT ALL UNITS IN T HE HOUSING PROJECT SHOULD HAVE THE BUILT UP AREA OF LESS THAN 1500 SQ. FT. EVEN IF BUILT UP AREA OF SOME OF THE UNITS EXCEED 1500 SQ.FT., DE DUCTION IS TO BE ALLOWED IN RESPECT OF THOSE UNITS WHOSE BUILT UP AR EA IS LESS THAN 1500 SQ.FT. IN THIS REGARD, RELIANCE WAS PLACED ON FOLLOWING DECISIONS: A) ROHAN HOMES VS ACIT [ITA NO.423/PN/2011] B) ANKIT ENTERPRISES [ITA.NO.156 AND 172/PN/2011] C) EKTA HOUSING PVT. LTD. [ITA NO.3649/MUM/2009] D) SANGHVI & DOSHI ENTERPRISES [139 ITD 151 (CHENNAI)(TM)] E) BENGAL HOUSING DEVELOPMENT LTD. VS. DCIT [ITA.NO.595/KOL/2005] F) D.S.KULKARNI DEVELOPERS LTD. [ITA NO.1428 AND 1429/PN/2008] 7 IN VIEW OF ABOVE, THE ASSESSEE SUBMITTED THAT DEDUC TION SHOULD BE ALLOWED ON PROPORTIONATE BASIS. 8. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATI VE ON PRORATA BASIS SUBMITTED THAT ONCE IN THE PROJECT AN Y FLAT EXCEEDS PRESCRIBED LIMIT OF 1500 SQ.FT., PROJECT LOOSES CHA RACTER OF HOUSING PROJECT WHICH IS PRECONDITION FOR CLAIMING DEDUCTIO N U/S.80IB(10). IN THIS REGARD, LD. DEPARTMENTAL REPRESENTATIVE REL IED ON THE DECISION OF THE ITAT, CHENNAI BENCH IN THE CASE OF ACIT VS. VISHWAS PROMOTERS PVT. LTD. (2010) 5 ITR (TRIB) 449 (CHENNA I), WHEREIN IT HAS BEEN HELD AS UNDER: FOR ENABLING THE BENEFIT OF SECTION 80IB(1) IT IS NECESSARY THAT PROFITS MUST BE DERIVED IN THE PREVIOUS YEAR FROM H OUSING PROJECT. THE ELIGIBILITY CONDITIONS INCLUDE, INTER ALIA, THAT THE BUILT-UP AREA SHOULD NOT EXCEED 1500 SQ.FT. IN THE CONTEST OF CITIES OTHER THAN DELHI AND MUMBAI. THIS RESTRICTI ON IS APPLICABLE TO THE ENTIRE PROJECT. IF SOME OF THE R ESIDENTIAL UNITS OF THE PROJECT COMPRISED AREA EXCEEDING THE PRESCRI BED LIMIT, THE BENEFIT, AS PER THE LANGUAGE OF THE SECTION CAN NOT BE EXTENDED TO THE PROJECT. 8.1. IT WAS FURTHER SUBMITTED THAT IN CASE LANGUAGE OF STATUTE IS PLAIN, ITS OBVIOUS MEANING SHOULD BE APPLIED AS HEL D BY THE HON'BLE SUPREME COURT IN THE CASE OF PADMASUNDARA RAO VS. S TATE OF TAMIL NADU (2002) 255 ITR 147 WHEREIN IT HAS BEEN HELD TH AT COURT CANNOT READ ANYTHING INTO A STATUTORY PROVISION WHI CH IS PLAIN AND UNAMBIGUOUS. A STATUTE IS THE EDICT OF THE LEGISLA TURE. THE LANGUAGE EMPLOYED IN STATUTE IS DETERMINATIVE FACTO R OF LEGISLATIVE INTENT. THE FIRST AND PRIMARY RULE OF CONSTRUCTION IS THAT THE INTENTION OF THE LEGISLATION MUST BE FOUND IN WORDS USED BY THE LEGISLATURE ITSELF. THE SAME VIEW HAS BEEN TAKEN I N CASE OF BRITANNIA INDUSTRIES LTD. VS CIT (2005) 278 ITR 546 (SC), INTER ALIA, THE HON'BLE SUPREME COURT HELD THAT WHEN LANGUAGE O F THE STATUTE IS CLEAR AND UNAMBIGUOUS, THE COURTS ARE TO INTERPR ET SAME IN ITS LITERAL SENSE AND NOT TO GIVE MEANING WHICH COULD C AUSE VIOLENCE TO THE PROVISIONS OF THE STATUTE. ACCORDING TO THE LD . DEPARTMENTAL REPRESENTATIVE, THE TERM PROJECT IS NOMEN GENERAL ISSIMUM; IT IS A 8 TERM OF MOST GENERAL MEANING. IT CONNOTES A PROPOS AL OF UNDERTAKING OR A SCHEME FOR SOMETHING TO BE DONE. A PROJECT CANNOT BE APPROVED IN PIECEMEAL. APPROVAL IS GRAN TED TO ENTIRE PROJECT BY ITSELF. BLOCKS OF RESIDENTIAL UNITS ARE PART OF PROJECT AND NOT PROJECT BY ITSELF. AS SUCH BLOCK OF RESIDENTIA L UNITS CANNOT BE CONSTRUED TO BE A SEPARATE PROJECT. IT IS, THEREFO RE, EVIDENT THAT ASSESSEE DID NOT COMPLY WITH THE CONDITION PRESCRIB ED FOR AVAILING BENEFIT OF SECTION 80IB(10). FURTHER, LD. DEPARTME NTAL REPRESENTATIVE RELIED ON THE DECISION OF THE HON'BL E BOMBAY HIGH COURT IN THE CASE OF CIT VS. BRAHMA ASSOCIATES 333 ITR 289 (BOM.) AND THE DECISION IN THE CASE OF VANDANA PROPERTIES WHEREIN IT HAS BEEN HELD AS UNDER: '18. THE EXPRESSION 'HOUSING PROJECT' IS NEITHER DE FINED UNDER SECTION 2 OF THE ACT NOR UNDER SECTION 80IB (10) OF THE ACT. EVEN UNDER THE MUMBAI MUNICIPAL CORPORATION ACT, 19 88 AS ALSO UNDER THE DEVELOPMENT CONTROL REGULATION FOR G REATER MUMBAI, 1991, THE EXPRESSION 'HOUSING PROJECT' IS N OT DEFINED. THEREFORE, THE EXPRESSION 'HOUSING PROJECT' IN SECT ION 80IB (10) WOULD HAVE TO BE CONSTRUED AS COMMONLY UNDERSTOOD. 19. AS RIGHTLY CONTENDED BY MR.LNAMDAR, LEARNED SEN IOR ADVOCATE APPEARING ON BEHALF OF THE ASSESSEE AND MR .MISTRI, LEARNED SENIOR ADVOCATE AND MR.JOSHI, LEARNED ADVOC ATE APPEARING ON BEHALF OF THE INTERVENORS, THE EXPRESS ION 'HOUSING PROJECT' IN COMMON PARLANCE WOULD MEAN CONSTRUCTING A BUILDING OR GROUP OF BUILDINGS CONSISTING OF SEVERA L RESIDENTIAL UNITS. IN FACT, THE EXPLANATION IN SECTION 80IB (10 ) SUPPORTS THE CONTENTION OF THE ASSESSEE THAT THE APPROVAL GRANTE D TO A BUILDING PLAN CONSTITUTES APPROVAL GRANTED TO A HOU SING PROJECT. THEREFORE, IT IS CLEAR THAT CONSTRUCTION O F EVEN ONE BUILDING WITH SEVERAL RESIDENTIAL UNITS OF THE SIZE NOT EXCEEDING 1000 SQUARE FEET ('E' BUILDING IN THE PRESENT CASE) WOULD CONSTITUTE A 'HOUSING PROJECT' UNDER SECTION 80IB (10) OF THE ACT.' 8.2. THE LD. DEPARTMENTAL REPRESENTATIVE ALSO RELIE D ON PARA 26 OF THE SAID ORDER OF BRAHMA ASSOCIATES (SUPRA) WHEREIN HON'BLE HIGH COURT HAS HELD AS UNDER: '26. THE OBJECT OF SECTION 80IB (10) IN GRANTING DE DUCTION EQUAL TO ONE HUNDRED PER CENT OF THE PROFITS OF AN UNDERT AKING ARISING FROM DEVELOPING AND CONSTRUCTING A HOUSING PROJECT IS WITH A 9 VIEW TO BOOST THE STOCK OF HOUSES FOR LOWER AND MID DLE INCOME GROUPS SUBJECT FULFILLING THE SPECIFIED CONDITIONS. THE FACT THAT THE MAXIMUM SIZE OF THE RESIDENTIAL UNIT IN A HOUSI NG PROJECT SITUATED WITH THE CITY OF MUMBAI AND DELHI ,/S REST RICTED TO 1000 SQUARE FEET CLEARLY SHOWS THAT THE INTENTION O F THE LEGISLATURE IS TO MAKE AVAILABLE LARGE NUMBER OF ME DIUM SIZE RESIDENTIAL UNITS FOR THE BENEFIT OF THE COMMON MAN . HOWEVER, IN THE ABSENCE OF DEFINING THE EXPRESSION 'HOUSING PROJECTS REQUIRED TO BE CONSTRUCTED ON A PLOT OF LAND HAVING MINIMUM AREA OF ONE ACRE, EVEN ONE HOUSING PROJECT CONTAINI NG MULTIPLE RESIDENTIAL UNITS OF A SIZE NOT EXCEEDING 1000 SQUARE FEET CONSTRUCTED ON A PLOT OF LAND HAVING MI NIMUM AREA OF ONE ACRE WOULD BE ELIGIBLE FOR SECTION 80IB (10) DEDUCTION. 8.3. IN THIS BACKGROUND, LD. DEPARTMENTAL REPRESENT ATIVE SUBMITTED THAT HON'BLE BOMBAY HIGH COURT HAS CLEARL Y LAID DOWN THE DEFINITION OF HOUSING PROJECT THAT IT CONSISTS OF RESIDENTIAL UNITS OF SIZE NOT EXCEEDING 1000/1500 SQ.FT., AS THE CASE MAY BE. IT NATURALLY MEANS THAT IF IN A PROJECT ANY UNIT EXCEE DS PRESCRIBED LIMIT, IT WILL BE ELIGIBLE HOUSING PROJECT FOR THE PURPOSE OF CLAIMING DEDUCTION U/S.80IB(10) AND ABOVE SAID JUDICIAL DECI SION IS BINDING. ACCORDINGLY, HE SUBMITTED THAT THE CIT(A) HAS RIGHT LY REJECTED THE CLAIM OF DEDUCTION U/S.80IB(10) ON THIS ACCOUNT. 9. AFTER GOING THROUGH THE ABOVE SUBMISSIONS AND MA TERIAL ON RECORD, WE FIND THAT THE ASSESSEE HAS CLAIMED DEDUC TION U/S.80IB(10) IN RESPECT OF PROJECT KUMAR SHANTINIKE TAN. ACCORDING TO THE ASSESSING OFFICER, BUILT UP AREA OF TWO FLAT S (FLATS NO.3 AND 4 IN BUILDING D) EXCEEDED 1500 SQ.FT., WHICH IS NOT IN DISPUTE. NOW THE ALTERNATE CONTENTION BEFORE US IS WHETHER DEDUC TION SHOULD BE ALLOWED ON PROPORTIONATE BASIS IN RESPECT OF UNITS WHOSE BUILT UP AREA IS LESS THAN 1500 SQ.FT. WE FIND THAT ITAT, P UNE A BENCH IN ROHAN HOMES IN ITA.NO.423/PN/2011 DATED 31.01.2013 WHEREIN TRIBUNAL HAS HELD AS UNDER: 11. WE HAVE CAREFULLY CONSIDERED THE AFORESAID PLE A SET UP BY THE LEARNED CIT-DR. ON A CAREFUL READING OF THE EN TIRE JUDGMENT OF BOMBAY HIGH COURT IN THE CASE OF VANDAN A PROPERTIES (SUPRA), WE DO NOT FIND ANY SUPPORT TO T HE PROPOSITION THAT PROPORTIONATE DEDUCTION U/S 80-IB( 10) OF THE 10 ACT IS NOT AVAILABLE IN CASE, CERTAIN RESIDENTIAL UNITS IN A PROJECT HAVE A BUILT-UP AREA IN EXCESS OF PRESCRIBE D LIMIT OF 1500 SQ.FT. IN FACT, THE SAID ISSUE WAS NOT BEFOR E THE HONBLE BOMBAY HIGH COURT. THE QUESTION BEFORE THE BOMBAY HIGH COURT WAS ENTIRELY DIFFERENT AND HENCE CERTAIN OBSE RVATIONS IN THE SAID JUDGMENT RENDERED IN THE CONTEXT OF THE SU BJECT MATTER OF DISPUTE BEFORE THE COURT, CANNOT BE CONSI DERED AS CONCLUSIVE SO FAR AS THE QUESTION WHICH IS BEFORE U S. THE ONLY ISSUE BEFORE THE HONBLE HIGH COURT WAS AS TO WHETH ER THE CONSTRUCTION OF ONE BUILDING CONTAINING MULTIPLE RE SIDENTIAL UNITS COULD BE CONSIDERED AS A PROJECT BY ITSELF CO NSIDERING THAT IT WAS A PART OF AN EARLIER APPROVED PROJECT. THE JUDGMENT OF THE HONBLE HIGH COURT IN THE CASE OF VANDANA PR OPERTIES (SUPRA) HAS TO BE APPRECIATED ONLY IN THIS CONTEXT. THEREFORE, THE ISSUE BEFORE US I.E. IN CASE WHERE CERTAIN RESI DENTIAL UNITS OF A PROJECT HAVE BUILT-UP AREA IN EXCESS OF 1500 S Q.FT. WOULD RESULT IN THE LOSS OF EXEMPTION FOR THE ENTIRE PROJ ECT OR NOT AND WHETHER THE ASSESSEE WOULD BE ENTITLED TO A PROPORT IONATE DEDUCTION, WAS NOT AN ISSUE BEFORE THE HONBLE JURI SDICTIONAL HIGH COURT IN THE CASE OF VANDANA PROPERTIES (SUPRA ). THEREFORE, THE SAID DECISION DOES NOT COME TO THE R ESCUE OF THE REVENUE. 12. IN THIS CASE, FACTUALLY, IT IS NOT IN DISPUTE T HAT SO FAR AS THE BUILT-UP AREA OF 17 FLATS IS CONCERNED, THE SAM E IS BEYOND THE LIMIT PRESCRIBED IN CLAUSE (C) TO SECTION 80-IB (10) OF THE ACT. THE PLEA OF THE ASSESSEE IS THAT THE ENTIR E PROJECT COULD NOT BE HELD INELIGIBLE FOR DEDUCTION U/S 80-IB(10) OF THE ACT. THE ASSESSEE CONTENDS THAT THE DEDUCTION U/S 80-IB( 10) OF THE ACT BE ALLOWED WITH RESPECT TO THE PROFITS DERIVED FROM THE DEVELOPMENT AND CONSTRUCTION OF RESIDENTIAL UNITS I N THE SAID PROJECT WHICH FULFIL THE REQUIREMENT OF BUILT-UP AR EA SPECIFIED IN CLAUSE (C) TO SEC. 80-IB(10) OF THE ACT. IN OTH ER WORDS, AS PER THE ASSESSEE, THE DEDUCTION U/S 80-IB(10) BE AL LOWED PRO- RATA TO THE INCOME FROM THE UNITS QUALIFYING IN TER MS OF SEC. 80-IB(10)(C) OF THE ACT. 13. THE CALCUTTA BENCH OF THE TRIBUNAL IN THE CASE OF BENGAL AMBUJA HOUSING DEVELOPMENT LTD. (SUPRA) HELD AS UND ER: IT IS APPARENT FROM THE PERUSAL OF SEC. 80-IB(10) THAT THIS SECTION HAS BEEN ENACTED WITH A VIEW TO PROVIDE INC ENTIVE FOR BUSINESSMEN TO UNDERTAKE CONSTRUCTION OF RESIDE NTIAL ACCOMMODATION FOR SMALLER RESIDENTIAL UNITS AND THE DEDUCTION IS INTENDED TO BE RESTRICTED TO THE PROFI T DERIVED FROM THE CONSTRUCTION OF SMALLER UNITS AND NOT FROM LARGER RESIDENTIAL UNITS. THOUGH THE AO HAS DENIED THE CLAIM OF THE ASSESSEE OBSERVING THAT LARGER UNITS W ERE ALSO CONSTRUCTED BY THE ASSESSEE, AT THE SAME TIME, IT IS SMALLER RESIDENTIAL UNITS WHICH WERE FULFILLING ALL THE CONDITIONS AS CONTAINED IN SEC. 80-IB(10) AND THE S AME HAS NOT BEEN DISPUTED BY THE AO ALSO. WE HAVE ALSO 11 NOTED DOWN THE FACT THAT EVEN THE PROVISION AS LAID DOWN IN SEC. 80-IB(10) FROM A HOUSING COMPLEX CONTAINING BOTH THE SMALLER AND LARGE RESIDENTIAL UNITS AND SINCE T HE ASSESSEE HAS ONLY CLAIMED DEDUCTION ON ACCOUNT OF SMALLER QUALIFYING UNITS BY FULFILLING ALL THE COND ITIONS AS LAID DOWN UNDER SECTION 80(IB(10), THE DENIAL OF CL AIM BY THE ASSESSEE IS ON ACCOUNT OF RATHER RESTRICTED AND NARROW INTERPRETATION OF PROVISIONS OF CLAUSE (C) O F SEC. 80-IB(10) WHILE COMING TO SUCH CONCLUSION, WE ALSO FIND SUPPORT FROM THE ORDER OF THE HONBLE SUPREME COURT IN THE CASE OF BAJAJ TEMPO LTD. (SUPRA) WHEREIN IT WAS HELD THAT PROVISIONS SHOULD BE INTERPRETED LIBERALLY AND SINCE IN THE PRESENT CASE ALSO, THE ASSESSEE BY CLAIMING PRO- RATA INCOME ON QUALIFYING UNITS HAS COMPLIED WITH C LAIM OF THE ASSESSEE WAS RIGHTLY ALLOWED BY THE LEARNED CIT(A) BY REVERSING THE ORDER OF THE AO. 14. SIMILARLY, THE BOMBAY BENCH OF THE TRIBUNAL IN THE CASE OF EKTA HOUSING PVT. LTD. IN ITA NO. 3649/MUM/2009 DATED 20-5-2011 PERTAINING TO A.Y. 2004-05 RELIED UPON T HE CALCUTTA BENCH OF THE TRIBUNAL, AS ALSO THE DECISIO NS IN THE CASES OF BRIGADE ENTERPRISES PVT. LTD., SHETH DEVEL OPERS PVT. LTD. AND OBSERVED THAT DEDUCTION U/S 80-IB(10) OF T HE ACT WAS TO BE ALLOWED ON PROPORTIONATE BASIS WITH REFERENCE TO QUALIFYING RESIDENTIAL UNITS AND THAT THE ASSESSEE WOULD NOT BE DENIED CLAIM FOR DEDUCTION U/S 80-IB(10) OF THE ACT IN ENTIRETY IF SOME OF ITS RESIDENTIAL UNITS WERE OF A BUILT-UP AREA EXCEEDING THE LIMIT PRESCRIBED IN CLAUSE (C) TO SEC . 80-IB(10) OF THE ACT. 15. PERTINENTLY, IT WOULD ALSO BE APPROPRIATE TO NO TICE THAT THE AFORESAID DECISION OF THE KOLKATA BENCH OF THE TRIBUNAL HAS SINCE BEEN CONFIRMED BY THE HONBLE CALCUTTA HI GH COURT VIDE ITS ORDER IN THE CASE OF BENGAL AMBUJA HOUSING DEVELOPMENT LTD. DATED 5-1-2007. THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF D.S. KULKARNI DEVELOPERS LT D. (SUPRA) HAS ALSO UPHELD SIMILAR PROPOSITION FOLLOWING THE A FORESAID PRECEDENTS. 16. FOLLOWING THE AFORESAID PRECEDENTS, WE ARE THER EFORE, OF THE VIEW THAT MERELY THE ASSESSEE HAS VIOLATED THE CONDITION U/S 80-IB(10)(C) OF THE ACT IN RELATION TO 17 FLATS , IT CANNOT BE DENIED THE DEDUCTION U/S 80-IB(10) OF THE ACT ON EN TIRE PROFITS OF THE PROJECT WHICH PERTINENTLY INCLUDE PROFITS IN RELATION TO RESIDENTIAL UNITS WHICH COMPLY WITH THE LIMITS PRES CRIBED IN SEC. 80-IB(10)(C) OF THE ACT. OF COURSE, THE DEDUC TION U/S 80- IB(10) OF THE ACT SHALL BE DENIED ON THE PROFITS PR OPORTIONATE TO 17 FLATS WHICH ARE IN VIOLATION OF SEC. 80-IB(10) O F THE ACT. FOR BALANCE OF THE RESIDENTIAL UNITS, THE PLEA OF THE A SSESSEE FOR DEDUCTION U/S 80-IB(10)OF THE ACT, IN OUR VIEW, IS FAIR AND REASONABLE. WE HOLD SO. 12 17. IN THE RESULT, WE SET ASIDE THE ORDER OF THE CI T(A) AND DIRECT THE ASSESSING OFFICER TO RE-WORK AND ALLOW T HE DEDUCTION U/S 80-IB(10) OF THE ACT TO THE ASSESSEE QUA THE PR OFITS RELATABLE TO THE RESIDENTIAL UNITS COMPLYING WITH T HE CONDITION PRESCRIBED U/S 80-IB(10)(C) OF THE ACT. 18. IN THE RESULT, THE APPEAL IS PARTLY ALLOWED. NOTHING CONTRARY WAS BROUGHT TO OUR KNOWLEDGE AND A BOVE DECISION IN ROHAN HOMES (SUPRA) LAID DOWN THAT ASSESSEE WILL NOT BE ELIGIBLE FOR DEDUCTION IN RESPECT TO THE UNITS EXCEEDING PRE SCRIBED LIMIT, BUT HE WILL BE ENTITLED FOR BALANCE RESIDENTIAL UNITS W HICH ARE WITHIN THE PRESCRIBED LIMITS OF SIZE OF 1500 SQ.FT., AS APPLIC ABLE TO THE PUNE MUNICIPAL CORPORATION. WE FIND THAT THE ITAT PUNE A BENCH IN THE CASE OF ANKIT ENTERPRISES VS ITO AND OTHERS, IN ITA.NO.156/PN/2011, HAS ALSO HELD AS UNDER: 16. RESPECTFULLY FOLLOWING THE DECISION OF THE TRI BUNAL IN THE CASE OF D.S.KULKARNI DEVELOPERS LTD. (SUPRA) WE HOL D THAT THE ASSESSEE IS ENTITLED TO PROPORTIONATE DEDUCTION IN RESPECT OF THE FLATS WHICH HAVE BUILT UP AREA OF LESS THAN 150 0 SQ.FT. WE ACCORDINGLY REMIT BACK THE MATTER TO THE FILE OF TH E AO WITH THE DIRECTION TO CALCULATE THE PROPORTIONATE DEDUCTION AND ALLOW THE DEDUCTION U/S.80IB(10) ON SUCH PROPORTIONATE PR OFIT. NEEDLESS TO SAY, THE AO SHALL GIVE DUE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE WHILE DETERMINING SUCH PROPOR TIONATE DEDUCTION. 17. SO FAR AS THE DECISIONS RELIED ON BY THE LEARNE D DR WE FIND THOSE ARE DISTINGUISHABLE AND NOT APPLICABLE T O THE FACTS OF THE PRESENT CASE. AS REGARDS THE DECISION OF TH E CHENNAI BENCH OF THE TRIBUNAL IN THE CASE OF VISWAS PROMOTE RS (SUPRA) WE FIND THE CHENNAI BENCH OF THE ITAT (TM) IN THE C ASE OF SANGHVI & DOSHI ENTERPRISE (SUPRA) HAS REVERSED THE SAME AND FOLLOWING THE DECISION OF HON'BLE CALCUTTA HIGH COU RT IN THE CASE OF CIT VS. BENGAL AMBUJA HOUSING DEVELOPMENT L TD. VIDE ITA NO.458 OF 2006 ORDER DATED 5-1-2007 HAS HELD TH AT THE ASSESSEE IS ENTITLED TO DEDUCTION U/S.80IB(10) IN R ESPECT OF FLATS HAVING BUILT UP AREA NOT EXCEEDING 1500 SQ.FT ., AND NOT ENTITLED TO DEDUCTION IN RESPECT OF THOSE FLATS HAV ING THEIR BUILT UP AREA EXCEEDING 1500 SQ.FT. THEREFORE, THE DECIS ION OF THE CHENNAI BENCH OF THE TRIBUNAL RELIED ON BY THE LEAR NED DR IS NOT APPLICABLE. 18. SO FAR AS THE DECISION OF THE JURISDICTIONAL HI GH COURT IN THE CASE OF VANDANA PROPERTIES (SUPRA) IS CONCERNED WE FIND 13 THE SAID DECISION IS ALSO NOT APPLICABLE TO THE FAC TS OF THE PRESENT CASE SINCE THE ISSUE THERE WAS NOT OF PRO-R ATA DEDUCTION. THE HON'BLE HIGH COURT IN THE SAID DECI SION HAS HELD THAT CONSTRUCTION OF EVEN 1 BUILDING WITH SEVE RAL RESIDENTIAL UNITS OF THE SIZE NOT EXCEEDING 1000 SQ .FT. WOULD CONSTITUTE A HOUSING PROJECT U/S.80IB(10). WE ACCO RDINGLY HOLD THAT THE DECISIONS RELIED ON BY THE DR ARE DIS TINGUISHABLE AND NOT APPLICABLE TO THE FACTS OF THE PRESENT CASE . THUS, THE ASSESSEES GROUND RELATING TO PRO-RATA DEDUCTION IS ALLOWED. 19. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED AND THE APPEAL FILED BY THE ASSESSEE IS PARTLY ALLO WED. 9.1. IN VIEW OF ABOVE, WE FIND THAT THE ITAT PUNE B ENCH IN THE CASE OF ROHAN HOMES (SUPRA) CONSIDERED ALL THE DECISIONS AND HELD THAT PRORATA DEDUCTION IS TO BE ALLOWED. IN THE SAID CA SE, TRIBUNAL HAS DISCUSSED THE DECISION OF HON'BLE BOMBAY HIGH COURT IN THE CASE OF VANDANA PROPERTIES WHICH WAS RELIED UPON BY THE LD. DEPARTMENTAL REPRESENTATIVE, INTER ALIA OBSERVED THAT THE SAID D ECISION OF HON'BLE BOMBAY HIGH COURT IN VANDANA PROPERTIES IS NOT APPL ICABLE TO THE ISSUE OF PRORATA DEDUCTION SINCE QUESTION INVOLVED WAS ENTIRELY DIFFERENT. IN PARA 11 OF ROHAN HOMES (SUPRA), THE ONLY ISSUE BEFORE THE HON'BLE HIGH COURT WAS AS TO WHETHER CONSTRUCTI ON OF ONE BUILDING CONTAINING MULTIPLE RESIDENTIAL UNITS CAN BE CONSIDERED AS PROJECT BY ITSELF. SO THE DECISION OF VANDANA PROP ERTIES DOES NOT HELP THE REVENUE. THIS VIEW IS FORTIFIED BY THE DE CISION OF THE ITAT MUMBAI BENCH IN EKTA PROMOTERS PVT. LTD. 3649/MUM/ 2009 DATED 25.05.2011 PERTAINING TO A.Y. 2004-05 RELYING UPON ITAT KOLKATA BENCH HAS AS ALSO THE DECISION IN THE CASE OF BRIGADE ENTERPRISES, IT HAS BEEN HELD THAT DEDUCTION U/S.80 IB(10) WAS TO BE ALLOWED ON PRORATA BASIS WITH REFERENCE TO QUALIFYI NG RESIDENTIAL UNITS AND ASSESSEE WOULD NOT BE DENIED CLAIM FOR DE DUCTION U/S.80IB(10) IF SOME OF ITS RESIDENTIAL UNITS ARE O F BUILT UP AREA EXCEEDING PRESCRIBED LIMIT IN CLAUSE (C) OF SECTION 80IB(10) OF THE ACT. DEDUCTION UNDER S.80IB INCOME FROM DEVELOPING AN D BUILDING HOUSING PROJECT DIFFERENT UNITS OF A GRO UP PROJECT WHERE SOME OF THE RESIDENTIAL UNITS IN A BIGGER HOU SING PROJECT, TREATED INDEPENDENTLY, ARE ELIGIBLE FOR RELIEF UNDE R S.80IB(10), RELIEF SHOULD BE GIVEN PRO RATA AND SHOULD NOT BE D ENIED BY TREATING THE BIGGER PROJECT AS A SINGLE UNIT, MORE SO, WHEN 14 ASSESSEE OBTAINED ALL SANCTIONS, PERMISSIONS AND CE RTIFICATES FOR SUCH ELIGIBLE UNITS SEPARATELY ASSESSEE UNDER TOOK A DEVELOPMENT PROJECT IN AN AREA OF 22 ACRES 19 GUNTA S CONSISTING OF 5 RESIDENTIAL BLOCKS, ROW HOUSES, OAK TREE PLACE, A CLUB, A COMMUNITY CENTRE, A SCHOOL AND A PARK AND CLAIMED DEDUCTION UNDER S. 80IB(10) IN RESPECT OF TWO RESID ENTIAL UNITS ONLY WHICH IF TAKEN SEPARATELY, WERE ELIGIBLE FOR T HE RELIEF AO TREATED THE ENTIRE PROJECT AS A SINGLE UNIT AND DEN IED RELIEF UNDER S.80IB(10) IN ENTIRETY CIT(A) ALLOWED RELIE F UNDER S. 80IB(10) TREATING THE SAID TWO UNITS AS INDEPENDENT UNITS JUSTIFIED MATERIAL ON RECORD SHOWED THAT THE VARI OUS LOCAL AUTHORITIES DULY INSPECTED THE PLOT AND SANCTIONED PLAN FOR EACH OF THE BLOCKS SEPARATELY GROUP HOUSING APPRO VAL WAS APPROVAL OF A MASTER PLAN AS A CONCEPT FURTHER, T HE USE OF THE WORDS RESIDENTIAL UNITS IN CL.(C) OF S.80IB(1 0) MEANS THAT DEDUCTION SHOULD BE COMPUTED UNIT-WISE THEREFORE, IF A PARTICULAR UNIT SATISFIES THE CONDITION OF S.80IB, THE ASSESSEE IS ENTITLED FOR DEDUCTION AND IT SHOULD BE DENIED IN R ESPECT OF THOSE UNITS ONLY WHICH DO NOT SATISFY THE CONDITION S AGAIN, THE ACCOUNTING PRINCIPLES WOULD ALSO MANDATE RECOGN ITION OF PROFITS FROM EACH UNIT SEPARATELY. 21.3 IN VIEW OF THE ABOVE DECISIONS, WE ARE OF THE CONSIDERED OPINION THAT WHATEVER PORTION COMPLETED BY THE ASSE SSEE WHICH SATISFIES THE CONDITIONS PRESCRIBED U/S.80IB( 10) IS ELIGIBLE FOR DEDUCTION. THE VARIOUS DECISIONS RELIE D ON BY THE REVENUE ARE DISTINGUISHABLE AND NOT APPLICABLE TO T HE FACTS OF THE PRESENT CASE. WE ACCORDINGLY HOLD THAT THE ASS ESSEE IS ELIGIBLE FOR DEDUCTION U/S.80IB(10) IN RESPECT OF B UILDING NO. A,C,D, E AND THE 17 ROW HOUSES. THE GROUNDS RAISED BY THE ASSESSEE ON THIS ISSUE ARE ACCORDINGLY ALLOWED. 22. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS PARTLY- ALLOWED. IT IS ALSO CLARIFIED THAT MADRAS HIGH COURT IN THE CASE OF VISHWAS PROMOTERS 81 DTR 68 HAS HELD THAT EVEN IF BUILT UP AREA OF FEW UNITS EXCEED 1500 SQ.FT., ASSESSEE WOULD NOT LOSE D EDUCTION IN ENTIRETY AND PRORATA DEDUCTION WOULD BE ALLOWED. T HIS TAKES CARE OF THE OBJECTION OF THE LD. DEPARTMENTAL REPRESENTATIV E IN THIS REGARD. IN VIEW OF ABOVE DISCUSSION, WE SET ASIDE THE ORDER OF THE CIT(A) ON THE ISSUE AND DIRECT THE ASSESSING OFFICER TO RE-WO RK AND ALLOW DEDUCTION U/S.80IB(10) OF THE ACT TO THE ASSESSEE. 10. THE NEXT ISSUE RAISED BY WAY OF GROUNDS NOS. 5 TO 11 FOR A.Y. 2008-09 IS WITH REGARD TO DEDUCTION IN RESPECT OF P ROJECT KUMAR 15 KRUTI. THE ASSESSEE HAS CLAIMED DEDUCTION IN RESPEC T OF PROJECT KUMAR KRUTI. THE ASSESSING OFFICER HAS DISCUSSED T HIS ISSUE IN PARAS 5 TO 5.5 OF HIS ORDER. THE ASSESSING OFFICER HAS DISALLOWED BY OBSERVING THAT PROJECT KUMAR KRUTI IS A PART OF LAR GE PROJECT NAMED KUMAR CITY AND AS THE SAID PROJECT WAS SANCTIONED P RIOR TO 01.04.2004, ASSESSEE SHOULD HAVE COMPLETED THE PROJ ECT ON OR PRIOR TO 31.03.2008. SECONDLY, COMMERCIAL AREA IN KUMAR CITY PROJECT IS MORE THAN LIMIT PRESCRIBED AND SINCE PROJECT KUMAR KRUTI IS A PART OF KUMAR CITY PROJECT, THE SAID CONDITION HAS ALSO BEEN VIOLATED. THIRDLY, BUILT UP AREA OF EIGHT FLATS EXCEEDED 1500 SQ.FT. WITH REGARD TO DISALLOWANCE OF CLAIM U/S.80IB(10) ON THE GROUND THAT BUILT UP AREA OF EIGHT FLATS EXCEEDED 1500 SQ.FT., WE HAVE DEALT AND DISCUSSED THIS ISSUE AND HAVE HELD BY FOLLOWING DEC ISION IN THE CASE OF ROHAN HOMES (SUPRA), ANKIT ENTERPRISES (SUPRA), EKTA PROMOTERS PVT. LTD. (SUPRA), SANGHVI & DOSHI ENTERPRISES (SU PRA), BENGAL HOUSING DEVELOPMENT LTD.(SUPRA), D.S. KULKARNI DEVE LOPERS (SUPRA) THAT ASSESSEE IS ELIGIBLE FOR DEDUCTION ON PRORATA BASIS WITH RESPECT TO THE ELIGIBLE FLATS IN THE PROJECT VIDE P ARA 9 OF THIS ORDER. 11. AS DISCUSSED ABOVE, THE ASSESSING OFFICER HAS M ENTIONED THAT PROJECT KUMAR KRUTI IS A PART OF BIG PROJECT CALLED KUMAR CITY. THE ASSESSING OFFICER IN PARA 5.2 HAS MENTIONED THAT PR OJECT KUMAR KRUTI IS A PART OF LAY OUT PLAN DATED 08.08.2003. HE HAS OBSERVED THAT ONCE PROJECT KUMAR KRUTI IS PART OF LAY OUT PL AN DATED 08.08.2003, IT IS OBVIOUS THAT PROJECT KUMAR KRUTI IS PART AND PARCEL OF KUMAR CITY PROJECT. THE ASSESSING OFFICE R FURTHER OBSERVED THAT WHEN THERE IS A COMMON LAY OUT FOR PR OJECT KUMAR KRUTI AND KUMAR CITY PROJECT, IT IS ONE PROJECT FOR THE PURPOSE OF CLAIMING BENEFIT OF DEDUCTION U/S.80IB(10) OF THE A CT. AS THERE WAS COMMERCIAL AREA IN KUMAR CITY PROJECT, THE ASSESSIN G OFFICER HELD THAT ON THIS GROUND AS WELL, DEDUCTION IS NOT ALLOW ABLE. THE ASSESSING OFFICER HELD THAT AS LAY OUT PLAN WAS SAN CTIONED ON 08.08.2003, ASSESSEE SHOULD HAVE COMPLETED CONSTRUC TION OF THE PROJECT BY 31.03.2008 AND SINCE THE PROJECT KUMAR K RUTI IS NOT 16 COMPLETE BY 31.03.2008, DEDUCTION WAS NOT ALLOWABLE . THE CIT(A) HAS DISCUSSED THIS ISSUE IN PARA 4.3 AND 4.4 AND HE LD AS UNDER: 4.3 THE SUBMISSION GIVEN IN THIS REGARD AND THE MA TERIAL AVAILABLE ON RECORD HAS BEEN PERUSED. THE APPELLAN T DURING THE APPELLATE PROCEEDINGS HAS CONTENDED THAT THE DISTINGUISHING PROVISIONS RELATING TO COMMENCEMENT OF THE PROJECT ARE EXACTLY SIMILAR TO THAT OF KUMAR SANSA R PROJECT AND THAT THE INTERPRETATION OF THE COMMENCEMENT DA TE ON WHICH THE A.O. HAD RELIED UPON HAVE BEEN SUBSEQUENT LY DISCUSSED AND DISTINGUISHED IN THE CASES OF APOORV A PROPERTIES & ESTATES PVT. LTD. VS. DCIT, PUNE A B ENCH 2008 AND SAROJ SALES VS.ITO, ITAT MUMBAI E BENCH 2007. HOWEVER, THE FACTUAL ASPECT OF THE PROJECT KUMAR K RUTI NOT BEING PART OF A LARGER PROJECT, I.E., KUMAR CITY HAS NOT BEEN FURNISHED NOR ANY EVIDENCE OR PLANS APPROVED HAVE B EEN FILED DURING THE APPELLATE PROCEEDINGS SO AS TO DISTINGUI SH THE FINDINGS OF THE A.O. AND BRING ANYTHING CONTRARY ON RECORD. SO FAR AS THE RELIANCE OF THE CASE LAW CITED IS CONCER NED, THE SAME WILL APPLY ONLY AFTER THE FACTS ARE BROUGHT ON RECO RD. NO MATERIAL FACT HAS BEEN BROUGHT ON RECORD BY THE APP ELLANT TO JUSTIFY THE CLAIMS THAT KUMAR KRUTI PROJECT WAS N OT PART OF THE LARGER PROJECT KUMAR CITY AS BROUGHT OUT BY T HE A.O. IN THE ASSESSMENT ORDER. THE TERM PROJECT CONNOTES A PROPOSAL FOR UNDERTAKING OR A SCHEME FOR SOMETHING TO BE DON E. THE APPELLANT DID FORMULATE SUCH SCHEMES WHICH ARE APPR OVED BY THE LOCAL AUTHORITY AND APPROVAL IS ACCORDED TO THE ENTIRE PROJECT AND BLOCKS OF RESIDENTIAL UNITS ARE PARTS O F A PROJECT AND NOT A PROJECT BY ITSELF AND AS SUCH BLOCK OF RE SIDENTIAL UNITS CANNOT BE CONSTRUED TO BE A SEPARATE PROJECT. 4.4. THE A.O. DURING THE ASSESSMENT PROCEEDINGS HAS ALSO AFTER PROPER VERIFICATION OF THE THREE SANCTIONED P LANS HAS COME TO THE CONCLUSION THAT AS THE PROJECT WAS INIT IALLY APPROVED PRIOR TO 01.0.2004 I.E., ON 08.08.2003, TH E PROJECT SHOULD HAVE BEEN COMPLETED BEFORE 31.03.2008 AND TH E APPELLANT HAS SUBMITTED THAT THE PROJECT WAS STILL UNDER CONSTRUCTION AS ON 31.03.2008. THUS PROVISION OF S ECTION 80IB(10) WAS VIOLATED AS THE PROJECT WAS NOT COMPLE TED BEFORE 31.03.2008. FURTHER, THE A.O. NOTICED THAT THE LAR GER PROJECT WHICH WAS APPROVED ON 08.08.2003 OF THE LARGER KUM AR CITY PROJECT CONTAINED COMMERCIAL AREA MORE THAN THAT ST IPULATED AS PER THE PROVISIONS OF SECTION 80IB(10) OF THE AC T. THE FINDINGS OF THE A.O. HAS BEEN ON THE BASIS OF THE V ERIFICATION OF THE PLAN KUMAR CITY DP LAYOUT SANCTIONED ON 08. 08.2003 VIDE DP NO.0/3466/H/26. THUS THE A.O. CONTENDED TH AT THE APPELLANT HAD VIOLATED THE PROVISION OF CLAUSE (D) OF SECTION 80IB(10) OF THE I.T. ACT. NO SUBMISSION IN THIS RE GARD HAS BEEN MADE BY THE APPELLANT AND AS NOTHING CONTRARY HAS BEEN BROUGHT ON RECORD THE ACTION OF THE A.O. IN DISALLO WING THE CLAIM OF DEDUCTION ON ACCOUNT OF VIOLATION OF CLAUS E (D) OF 17 SECTION 80IB(10) IS LIABLE TO BE UPHELD. MOREOVER, THE FACTS AS BROUGHT ON RECORD AND THE FINDING OF THE ASSESSING OFFICER THAT THE PROJECT KUMAR KRUTI IS ONLY A PART OF THE LAR GER PROJECT KUMAR CITY ALSO DOES NOT CALL FOR ANY INTERFERENC E AS NOTHING CONTRARY HAS BEEN BROUGHT OUT BY THE APPELLANT TO J USTIFY THE CLAIM MADE/GROUND RAISED IN THIS REGARD. THUS CIT(A) HAS STATED THAT ASSESSEE HAS NOT BEEN A BLE TO DEMONSTRATE THAT PROJECT KUMAR KRUTI IS AN INDEPEND ENT PROJECT AND NOT PART OF KUMAR CITY PROJECT. ACCORDINGLY, H E CONFIRMED THE ORDER OF THE ASSESSING OFFICER ON THE ISSUE AS DISC USSED ABOVE. 12. THE LD. AUTHORISED REPRESENTATIVE BEFORE US SUB MITTED THAT PROJECT KUMAR KRUTI IS AN INDEPENDENT PROJECT AND N OT A PART OF KUMAR CITY PROJECT. THE ASSESSING OFFICER IN ASSES SMENT ORDER HAS STATED THAT BUILDINGS WHICH ARE PART OF PROJECT KUM AR KRUTI ARE PART OF LAYOUT PLANT DATED 08.08.2003. IN THIS REGARD, STAND OF THE ASSESSEE HAS BEEN THAT IN SAID PLAN, PROJECT KUMAR KRUTI HAS BEEN MENTIONED AS EVIDENT FROM COPY OF LAY OUT PLANT DAT ED 08.08.2003 AS ENCLOSED ON PAGE 3 OF THE PAPERBOOK FILED ON BEH ALF OF THE ASSESSEE. THE STAND OF THE ASSESSEE HAS BEEN THAT SIMPLY BECAUSE SAID PROJECT IS A PART OF LAY OUT PLAN, DOES NOT JU STIFY TO HOLD THAT PROJECT KUMAR KRUTI IS PART OF KUMAR CITY PROJECT. ACCORDING TO THE LD. AUTHORISED REPRESENTATIVE, BUILDING PLAN DATED 13.10.2003 AS ENCLOSED ON PAGE 5 OF THE PAPERBOOK ACCORDING TO WH ICH THE SAID BUILDING PLAN THE AREA ON WHICH PROJECT KUMAR KRUTI IS CONSTRUCTED HAS BEEN SHOWN BLANK. WE FIND THAT THE PORTION SHO WN ON PAGE 3 OF THE PAPERBOOK WAS HAVING CLUSTER OF PLOTS MENTIO NED AT 6 WHILE SOME PORTION HAS BEEN SHOWN BLANK ON PAGE 5 OF THE PAPERBOOK ON SAME PORTION WHICH IS BUILDING PLAN DATED 13.10.200 3. ACCORDING TO THE LD. AUTHORISED REPRESENTATIVE, THE POINT ASS ESSEE WANTS TO MAKE FROM THIS IS THAT NO BUILDING PLAN FOR PROJECT KUMAR KRUTI WAS SANCTIONED PRIOR TO 01.04.2004 WHICH IS EVIDENT FRO M FACT THAT THERE IS NO BUILDING IN THE AREA OF SO CALLED FUTURE KUMA R KRUTI PROJECT PORTION WAS CONCEIVED AS PER BUILDING PLAN DATED 13 .10.2003. THE LD. AUTHORISED REPRESENTATIVE FURTHER POINTED OUT T HAT BUILDING PLAN FOR PROJECT KUMAR KRUTI WAS SANCTIONED ON 26.0 7.2006 FOR THE 18 FIRST TIME. COPY OF THE SAME IS ENCLOSED ON PAGE 8 OF THE PAPERBOOK, WHICH IS EVIDENT FROM WRITING ON RIGHT UPPER SIDE O N PAGE 8 OF BUILDING PLAN DATED 26.07.2006. ACCORDING TO THE A SSESSING OFFICER, LAY OUT PLANT IS COMMON AND PROJECT KUMAR KRUTI IS PART OF KUMAR CITY PROJECT. IN THIS REGARD STAND OF THE ASSESSEE IS THAT EVEN IF THERE IS A COMMON LAY OUT PLAN, BUT BUILDING PLAN S ANCTIONED ON DIFFERENT DATES FOR VARIOUS PROJECTS, IT COULD NOT BE STATED THAT ALL PROJECTS ARE PART OF THE SAME PROJECT ORIGINALLY CO NCEIVED AS A LAY OUT. THE LD. AUTHORISED REPRESENTATIVE STATED THAT AS PER EXPLANATION TO CLAUSE (A) OF SECTION 80IB(10), DATE OF APPROVAL OF HOUSING PROJECT MEAN DATE ON WHICH BUILDING PLAN WA S FIRST APPROVED BY THE LOCAL AUTHORITY. IN THIS BACKGROUN D IT WAS SUBMITTED THAT BUILDING PLAN IS RELEVANT INSTEAD OF LAY OUT PLAN FOR THE PURPOSE OF INTERPRETING ALLOWABILITY OF DEDUCTI ON U/S.80IB(10). 13. THUS ACCORDING TO LD. AUTHORISED REPRESENTATIVE , BUILDING PLAN FOR PROJECT KUMAR KRUTI WAS SANCTIONED INDEPEN DENT OF KUMAR CITY PROJECT. THE ASSESSING OFFICER WITHOUT DISPUT ING THIS FACT HAS DENIED DEDUCTION ON THE GROUND THAT THERE IS A COMM ON LAY OUT PLAN. IN THIS REGARD STAND OF THE ASSESSEE IS THAT THERE IS DIFFERENCE BETWEEN LAY OUT PLAN AND BUILDING PLAN. THE LAY OU T PLANT IS ONLY A CONCEPTUAL PLAN GIVING GENERAL IDEA OF THE DEVELOPM ENT OF THE LAND, HOWEVER, BUILDING PLAN AS PER WHICH CONSTRUCTION IS PROMOTED AS PER RELEVANT BUILDING BYE-LAWS APPLICABLE TO THE AR EA. SINCE BUILDING PLAN WAS SANCTIONED ON 26.07.2006 PERTAINI NG TO PROJECT KUMAR KRUTI, NO JUSTIFICATION IN HOLDING THAT PROJE CT KUMAR KRUTI IS A PART OF KUMAR CITY PROJECT. THE ASSESSEE SUBMIT TED THAT EVEN IF THERE IS A COMMON LAY OUT PLAN BUT INDEPENDENT BUIL DING PLAN, PROJECT APPROVED UNDER SEPARATE BUILDING PLANS IS T O BE CONSIDERED AS INDEPENDENT PROJECTS AND NOT PART OF LARGER PROJ ECT AS MENTIONED IN THE LAY OUT. IN THIS REGARD, LD. AUTHORISED REP RESENTATIVE RELIED ON THE FOLLOWING DECISIONS: A. APOORVA PROPERTIES AND ESTATES PVT. LTD. [ITA NO.113/PN/07] B. ADITYA DEVELOPERS [ITA NO.791 & 792/PN/08] C. ANKIT ENTERPRISES [ITA NO.1146/PN/10] 19 D. BRIGADE ENTERPRISES PVT. LTD. [119 TTJ 269 (BANG)] E. P.V.MAHADKAR & ASSOCIATES [ITA NO.1117/PN/10] 14. IN VIEW OF ABOVE DECISIONS, THE ASSESSEE SUBMIT TED THAT PROJECT KUMAR KRUTI WAS INDEPENDENT PROJECT SINCE BUILDING PLAN OF THE SAID PROJECT WAS SANCTIONED INDEPENDENTLY ON 26.07. 2006. ACCORDINGLY, DEDUCTION IN RESPECT OF THIS PROJECT K UMAR KRUTI SHOULD BE ALLOWED U/S.80IB(10) OF THE ACT. 15. THE LD. AUTHORISED REPRESENTATIVE FURTHER SUBMI TTED THAT THE ASSESSING OFFICER HAS DENIED DEDUCTION ALSO ON THE GROUND COMMERCIAL AREA IN THE SAID PROJECT EXCEEDED THE LI MITS PRESCRIBED. IN THIS REGARD, THE STAND OF THE ASSESSEE IS THAT T HIS VIEW HAS BEEN TAKEN BY THE ASSESSING OFFICER ON THE PREMISES THAT PROJECT KUMAR KRUTI IS PART OF KUMAR CITY PROJECT. THE COMMERCIA L AREA IS IN KUMAR CITY PROJECT. THERE IS NO COMMERCIAL AREA IN PROJECT KUMAR KRUTI. ONCE IT IS HELD THAT PROJECT KUMAR KRUTI IS AN INDEPENDENT PROJECT, THERE IS NO COMMERCIAL AREA IN SAID PROJEC T KUMAR KRUTI AND ACCORDINGLY ASSESSEE HAS NOT VIOLATED THE LIMIT S OF COMMERCIAL AREA AS PRESCRIBED IN SECTION 80IB(10). THUS, THER E IS NO JUSTIFICATION FOR DENYING BENEFIT OF DEDUCTION UNDE R THE PROVISIONS OF SECTION 80IB(10) TO THE ASSESSEE. 16. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTAT IVE HEAVILY RELIED ON THE DECISION OF THE CIT(A) ON THREE ACCOU NTS THAT PROJECT KUMAR KRUTI IS A PART OF LARGER PROJECT NAMED KUMAR CITY PROJECT WHICH WAS SANCTIONED PRIOR TO 01.04.2004 AND ASSESS EE WAS SUPPOSED TO COMPLETE THE PROJECT BY 31.03.2008, COM MERCIAL AREA IN KUMAR CITY PROJECT IS MORE THAN THE LIMIT PRESCR IBED SINCE PROJECT KUMAR KRUTI IS A PART OF KUMAR CITY PROJECT , THE SAID CONDITION HAS BEEN VIOLATED AND THE ASSESSING OFFIC ER WAS JUSTIFIED IN DISALLOWING THE CLAIM OF DEDUCTION U/S.80IB(10). FURTHER BUILT UP AREA OF CERTAIN FLATS WAS EXCEEDING THE PRESCRIB ED LIMIT OF 1500 SQ.FT., SO THE ASSESSEE WAS NOT ENTITLED FOR DEDUCT ION U/S.80IB(10) ON THIS ACCOUNT AS WELL. ACCORDINGLY, THE ORDER OF THE CIT(A) SHOULD BE UPHELD. 20 17. AFTER GOING THROUGH THE ABOVE SUBMISSIONS AND M ATERIAL ON RECORD, WE FIND THAT THE ASSESSEE HAS DISALLOWED TH E CLAIM OF THE ASSESSEE ON THREE ACCOUNTS VIZ., THE PROJECT KUMAR KRUTI IS PART OF LARGER PROJECT NAMED KUMAR CITY PROJECT, ASSESSEE S HOULD HAVE COMPLETED THE PROJECT BY 31.03.2008. FURTHER, THE C OMMERCIAL AREA IN KUMAR CITY PROJECT IS MORE THAN LIMITS PRESCRIBE D, THE SAID CONDITION HAS ALSO BEEN VIOLATED AND LASTLY BUILT U P AREA OF EIGHT FLATS EXCEED 1500 SQ.FT., WHICH IS ALSO VIOLATION O F CONDITIONS PRESCRIBED U/S.80IB(10). AS DISCUSSED ABOVE, FOLLOW ING THE REASONING IN PROJECT KUMAR SHANTINIKETAN, WE HAVE ALLOWED DEDUCTION ON PRORATA BASIS WITH REGARD TO COMPLETED ELIGIBLE FLATS VIDE PARA 9 OF THIS ORDER. ACCORDINGLY ASSESSING O FFICER IS DIRECTED TO REWORK DEDUCTION OF CLAIM U/S.80IB(10) ON ELIGIB LE FLATS AFTER EXCLUDING EIGHT FLATS WHOSE AREA EXCEED PRESCRIBED LIMIT OF AREA. 18. REGARDING TWO REMAINING ISSUES WE FIND NO DISPU TE THAT PROJECT KUMAR KRUTI IS A PART OF KUMAR CITY PROJECT AS FAR AS LAY OUT DATED 08.08.2003 IS CONCERNED. THERE IS NO DISPUTE THT THERE ARE COMMON LAY OUT FOR PROJECT KUMAR KRUTI AND KUMAR CI TY PROJECT. THE STAND OF THE ASSESSEE HAS BEEN THAT PROJECT KUM AR KRUTI IS AN INDEPENDENT PROJECT AND NOT PART OF KUMAR CITY PROJ ECT. SIMPLY BECAUSE PROJECT KUMAR KRUTI IS A PART OF KUMAR CITY PROJECT IN THE LAY OUT, IT IS NOT JUSTIFIED IN HOLDING THAT PROJEC T KUMAR KRUTI IS A PART OF KUMAR CITY PROJECT. IT IS OBVIOUSLY CLEAR FROM BUILDING PLAN OF KUMAR CITY PROJECT DATED 13.10.2003 AS ENCLOSED ON PAGE 5 OF THE PAPERBOOK WHEREIN AREA ON WHICH KUMAR KRUTI PRO JECT WAS TO BE CONSTRUCTED HAD BEEN SHOWN BLANK. IT MAKES ABUN DANTLY CLEAR THAT THE ASSESSEE HAS NOT CONCEIVED THE BUILDING PL ANT FOR PROJECT KUMAR KRUTI PRIOR TO 01.04.2004. IN FACT BUILDING PLAN FOR PROJECT KUMAR KRUTI WAS SANCTIONED ON 26.07.2006 FOR THE FI RST TIME WHICH IS EVIDENT FROM BUILDING PLAN SANCTION PLACED ON PA GE 8 OF THE PAPERBOOK. THUS, PROJECT KUMAR KRUTI HAS BEEN INDE PENDENTLY SANCTIONED VIDE BUILDING PLAN DATED 26.07.2006. IN THIS SITUATION, THE ASSESSING OFFICER WAS NOT JUSTIFIED IN HOLDING THAT SINCE LAY OUT 21 PLAN IS COMMON, PROJECT KUMAR KRUTI IS A PART OF KU MAR CITY PROJECT. EVEN IF THERE IS A COMMON LAY OUT PLAN, B UT BUILDING PLANS ARE OBTAINED INDEPENDENTLY/SEPARATELY FOR VARIOUS P ROJECTS, IT CANNOT BE HELD THAT ALL PROJECTS ARE ONE AND PART O F SAME PROJECT. AS PER EXPLANATION TO CLAUSE (A) OF SECTION 80IB(10 ), THE DATE OF APPROVAL OF HOUSING PROJECT MEANS THE DATE ON WHICH BUILDING PLAN WAS APPROVED BY THE LOCAL AUTHORITY. IT MAKES CLEA R THAT BUILDING PLAN AND LAY OUT PLAN ARE TWO DIFFERENT SANCTIONS. IT IS NOT IN DISPUTE THAT BUILDING PLAN FOR PROJECT KUMAR KRUTI WAS SANCTIONED INDEPENDENTLY ON 26.07.2006. EVEN THEN, THE ASSESS ING OFFICER HAS DENIED DEDUCTION ON THE GROUND THAT THERE IS A COMM ON LAY OUT FOR BOTH THE PROJECTS, I.E., PROJECT KUMAR KRUTI AND KU MAR CITY PROJECT, AS WE HAVE CLARIFIED ABOVE LAY OUT SHOULD NOT BE CO NFUSED WITH THE BUILDING PLAN. LAY OUT PLAN IS ONLY A CONCEPTUAL PL AN GIVING GENERAL IDEA OF DEVELOPMENT OF THE LAND. HOWEVER, BUILDING PLAN IS THE PLAN AS PER WHICH CONSTRUCTION IS PROMOTED AS PER DETAIL S SANCTIONS AS PER RELEVANT BUILDING BYE LAWS APPLICABLE TO THE AR EA. EVEN AUTHORITIES FOR SANCTION OF LAY OUT PLAN AND BUILDI NG PLAN ARE DIFFERENT. AS BUILDING PLAN FOR PROJECT KUMAR KRUT I WAS SANCTIONED ON 26.7.2006, AUTHORITIES BELOW WERE NOT JUSTIFIED IN HOLDING THAT THIS PROJECT IS A PART OF KUMAR CITY PROJECT. EVEN IF THERE IS A COMMON LAY OUT PLAN BUT INDEPENDENT BUILDING PLAN, THE PROJECT APPROVED UNDER SEPARATE BUILDING PLANS IS TO BE CON SIDERED AS INDEPENDENT PROJECT AND NOT PART OF LARGER PROJECT. WE FIND THAT ITAT PUNE A BENCH IN APOORVA PROPERTIES AND ESTAT ES PVT. LTD. VS. DCIT DATED 21.08.2009 HAS HELD AS UNDER: 7. WE FIND THAT THE OBJECTIONS BASED ON WHICH THE IMPUGNED CLAIM OF DEDUCTION U/S.80-IB(10) IS REJECTED HAVE B EEN CONSIDERED BY THE CO-ORDINATE BENCHES ON A FEW OCCA SIONS AS ALSO THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF BRAHMA ASSOCIATES VS. JOINT CIT (OSD) CIR.4, PUNE (2009) 1 19 ITD 255. AS REGARDS THE QUESTION OF COMMERCIAL USE OF BUILT UP AREA THE SPECIAL BENCH HAS OPINED THAT AS LONG AS IT DOES NO T EXCEED 10% OF THE TOTAL BUILT UP AREA, THE PROJECT WILL CO NTINUE TO HAVE THE CHARACTER OF HOUSING PROJECT AND ACCORDINGLY, T HE DEDUCTION U/S.80-IB(10) CANNOT BE DECLINED FOR THAT REASON ALONE. IN THE PRESENT CASE, THE COMMERCIAL BUILT UP AREA IS HARDLY LESS THAN 10%. AS REGARDS THE QUESTION ABOU T SIZE OF 22 THE FLATS WE HAVE TAKEN NOTE OF THE FACTUAL POSITIO N THAT EVEN ACCORDING TO THE ASSESSING OFFICER NONE OF THE FLAT S IN PHASE II EXCEEDS THE SIZE OF 1500 SQ.FT. IN ANY EVENT IN TH E COURSE OF REMAND PROCEEDINGS, THE MATTER WAS EXAMINED BY THE ASSESSING OFFICER AGAIN. THE ASSESSING OFFICER IS NOT ABLE TO POINT OUT ANY SPECIFIC VIOLATION OF THE SAID PROVIS ION. LEARNED DEPARTMENTAL REPRESENTATIVE VERY FAIRLY ACCEPTED TH AT HE IS NOT IN A POSITION TO POINT OUT ANY SUCH INSTANCE. THAT LEAVES US A QUESTION AS TO WHETHER KUMAR KARISHMA IS TO BE TREA TED AS AN INTEGRAL AND INSEPARABLE PROJECT OR VARIOUS PROJECT S OF THIS PROJECT CAN BE CONSIDERED ON A STAND ALONE BASIS. ONE OF THE MAJOR ARGUMENTS IN SUPPORT OF THE ENTIRE PROJECT BE ING TREATED AS ONE PROJECT IS COMMON FACILITIES USED BY THE FLA T OWNERS BUT THEN WE ARE UNABLE TO APPRECIATE AS TO HOW MERE FAC T OF FACILITIES BEING COMMON CAN BE USED AGAINST THE ASS ESSEES CLAIM OF SEPARATE PROJECT. IT IS VERY WELL POSSIBL E THAT THE AMENITIES OF ONE PROJECT CAN BE USED BY RESIDENTS O F THE OTHER PROJECT AND THAT ALONE CANNOT ALTER THE CHARACTER O F INDEPENDENT PROJECT. AS WE MENTIONED EARLIER, THER E ARE NUMBER OF DECISIONS OF CO-ORDINATE BENCHES INCLUDIN G SAROJ SALES ORGANIZATION VS. ITO (2008) 115 TTJ (BOM) 485 AND CIT VS. BRIGADE ENTERPRISES (2008) 119 TTJ (BANG) 269 W HEREIN IT IS HELD THAT AS LONG AS DIFFERENT BLOCKS CAN SATISF Y THE REQUIREMENT OF SECTION 80-IB(10) ON A STAND ALONE B ASIS, THEIR CLAIM CANNOT BE REJECTED MERELY ON THE GROUND THAT THEY ARE PART OF LARGER LAY OUT. IN THE PRESENT CASE, THERE IS NO DISPUTE THAT THE ASSESSEE HAS CONSTRUCTED DIFFERENT BLOCKS OF RESIDENTIAL BUILDINGS AND HE HAS NOT CLAIMED DEDUCT ION U/S.80-IB(10) IN RESPECT OF BUILDING WHICH WAS NOT ELIGIBLE FOR THE SAME. IT IS ALSO NOT DISPUTED THAT SEPARATE SA NCTIONS WERE GRANTED BY THE PUNE MUNICIPAL CORPORATION FOR THE P HASE II OF THE PROJECT AND THAT IT SATISFIES THE CONDITIONS OF SECTION 80-IB(10) ON A STAND ALONE BASIS. AS HAS BEEN HELD BY THE CO-ORDINATE BENCHES THE CONCEPT OF HOUSING PROJECT DOES NOT MEAN THAT THERE SHOULD BE A GROUP OF BUILDINGS AND ONLY THEN THE SAME CAN BE COLLECTIVELY CALLED AS A HOUSING PR OJECT. IN THE CASE OF SAROJ SALES ORGANISATION (SUPRA), WHILE DEA LING WITH THIS CONTENTION, THE CO-ORDINATE BENCH HAS OBSERVED AS FOLLOWS: THE COMMENCEMENT CERTIFICATES IN RESPECT OF BUILDI NG NO.I CONSISTING OF WINGS A AND B WERE RECEIVED BY C APL ON 7TH MARCH, 2001 AND 30TH MARCH, 2001 RESPECTIVEL Y. BUT THE COMMENCEMENT CERTIFICATES FOR VARIOUS WINGS IN BLOCK 'N' WERE APPROVED BY THE MUNICIPALITY ON VARIOUS DATES BETWEEN 10 TH SEPT., 2001 TO 23 RD SEPT., 2003, ALL THE SIX WINGS ARE PART OF 'N' BLOCK AND INDEPENDENTLY SATISFIES THE NECESSARY APPROVAL OF A HOUSING PROJECT. IT REALLY MAKES NO DIFFERENCE WHETH ER CAPL HAD APPLIED FOR OR THE ASSESSEE HAD APPLIED TO THE MUNICIPAL CORPORATION TO MAKE ANY DIFFERENCE IN DEC IDING THE ASSESSEES CLAIM FOR DEDUCTION UNDER S. 80-IB(1 0). IT 23 MUST BE APPRECIATED THAT THE MAIN DEVELOPER WAX CAP L. THE SANCTION PLAN HAVE ONLY APPROVED THE CONSTRUCTION OF THE DWELLING UNITS OF LESS THAN 100 0 SQ.FT. IN ALL THE WINGS OF THE SAID PROJECT. THERE I S NO DISPUTE THAT TILL THE FLATS IN THE WINGS IN BLOCK 'N' CONTAIN THE ELIGIBLE UNITS. IT IS NOT OPEN TO THE REVENUE T O INCLUDE THE NEXT PROJECT 'BC' BLOCK AS PART OF THE EARLIER HOUSING PROJECT JUST TO DENY THE STATUTORY RELIEF, W HICH THE ASSESSEE IS ENTITLED IN RESPECT OF THE ELIGIBLE HOUSING PROJECT. IN THAT WAY THE LEGISLATIVE INTENTION TO GI VE RELIEF TO THE ASSESSEE WHO IS UNDERTAKING THE LAW HOUSING PROJECTS WILL GET DEFEATED. 'BC' PROJECT WAS MEANT FOR HIGHER STRATA OF THE SOCIETY. THE ASSESSES HAS SEGR EGATED THE SAME AND IN NO WAY MIXED IN THESE PROJECTS EITHE R IN THE DESIGN OR IN THE STRUCTURAL MANIPULATION OR IN THE PROVISION OF AMENITIES AND THE ASSESSEE HAS NOT CLA IMED ANY RELIEF IN RESPECT OF PROJECT WHICH ADMITTEDLY DO ES NOT ADMIT THE LEST LAID DOWN UNDER S . 80-IB(10) . COMBINING THESE TWO PROJECTS INTO ONE WILL LEAD TO A RESULT, W HICH MANIFESTLY WILL BE UNJUST AND ABSURD AND DEFEAT THE VERY PROVISIONS OF DEDUCTION SECTIONS. UNLESS THERE IS A CLEAR INTENTION OF THE LEGISLATOR THE REVENUE CANNOT BE PERMITTED TO DO SO. AFTER ALL THE ASSESSEE HAS OBTA INED DIFFERENT COMMENCEMENT CERTIFICATES AND STARTED ON DIFFERENT PERIODS OF TIME. THEY ARE SEPARATE BY TIM E, SPACE AND STATUTORY APPROVALS AND EVEN IN DESIGNS, MAINTENANCE OF SEPARATE BOOKS OF ACCOUNT. THE REVEN UE IS NOT RIGHT IN TREATING BOTH THE PROJECTS AS ONE AN D INTEGRATED WITHOUT THE FACTS WARRANTING FOR SUCH CONCLUSION. OBJECTION OF THE AO THAT AS THE PERMIS SIBLE SHOPPING AREA OF HOUSING PROJECT EXCEEDS 5 PER CENT, THE ASSESSEE IS NOT ENTITLED FOR RELIEF UNDER S. 80-IB( 10) IS NOT SUSTAINABLE. THE HOUSING PROJECTS WERE APPROVED BEFO RE 3LST MARCH, 2005 AND FOR SUCH PROJECT, WHICH WERE S O APPROVED, THERE WAS NO STIPULATION AS TO THE SHOPPI NG COMPLEX AREA IS PERMISSIBLE IN THE PROJECT. THE AMENDMENTS WERE SUBSEQUENTLY MADE WHILE EXTENDING THE DEDUCTION OF INCOME FRONT HOUSING PROJECT APPRO VED UPTO 31 ST MARCH, 2007, AND THE DENIAL OF DEDUCTION IS CLEARLY NOT IN ACCORDANCE WITH LAW. AS THE OCCUPATI ON CERTIFICATE IN RESPECT OF THE WINGS F, FL AND G HAV E BEEN ISSUED ON 20 TH DEC., 2006, I.E. PRIOR TO 31 ST MARCH, 2008, THE CONDITION RELATING TO COMPLETION OF THE CONSTRU CTION AX PRESCRIBED IN S. 80-IB(1O)(A) SHOULD ALSO BE TAK EN TO BE SATISFIED.-BENGAL AMBUJA HOUSING DEVELOPMENT LTD . VS. DY. CIT (ITA NOS.1594 AND 1737/KOL/2005 DTD. 24 TH APRIL, 2006) RELIED ON. ASSESSEE HAVING COMPLETED THE CONSTRUCTION OF VARIO US WINGS OF THE BUILDING UNDER THE APPROVED PLAN IN TW O DIFFERENT BLOCKS UNDER DIFFERENT CERTIFICATES OF COMMENCEMENT, WAS ELIGIBLE FOR DEDUCTION U/S 24 80-IB(1O) IN RESPECT OF ONE BLOCK IN RESPECT OF WHI CH CLAIM FOR DEDUCTION WAS MADE AND WHICH SATISFIED TH E REQUIREMENT OF SEC. 80-IB(10); CLAIM COULD NOT BE DENIED BY CLUBBING THE TWO BLOCKS ESPECIALLY WHEN T HE SECOND BLOCK HAD BEEN KEPT SEPARATE BY THE ASSESSEE AND FOR WHICH DEDUCTION UNDER SEC. 80-IB(10) WAS NO T CLAIMED. ' 8. WE HAVE ALSO NOTED THAT AS EVIDENT FROM THE FOLL OWING CHART, THE CONDITIONS OF PLOT SIZE AS REQUIRED BY S ECTION 80- IB(10) OF THE ACT ARE INDEPENDENTLY SPECIFIED BY PH ASE II. SR NO. PARTICULARS PHASE - I PHASE - II TOTAL 1 TOTAL PLOT AREA 7723 (IN ACRES 1.99) 20577 (IN ACRES 5.08) 28300 2 RESIDENTIAL (SALEABLE BUILT-UP AREA) 13511 21970 35481 3 AREA COVERED BY AMENITIES** 1060 1596 2656 4 COMMERCIAL AREA 1090 - 1090 TOTAL (2+3+4) 15661 23 566 39228 ** PLEASE NOTE THAT THE AREA COVERED BY COMMON AME NITIES IS DIVIDED AMONGST PHASE-I & PHASE-II CONSIDERING THE TOTAL RESIDENTIAL SALEABLE AREA OF THE RESPECTIVE PHASES. 9. IN THIS VIEW OF THE MATTER AND BEARING N MIND TH E ENTIRETY OF THE CASE, WE ARE UNABLE TO APPROVE THE ORDER OF THE CIT(A) IN DECLINING DEDUCTION U/S.80-IB(10) OF THE ACT. IN O UR CONSIDERED VIEW AND IN THE LIGHT OF THE DECISIONS O F THE CO- ORDINATE BENCHES, THE ASSESSEE IS ENTITLED TO DEDUC TION U/S.80- IB(10) OF THE ACT. WE ACCORDINGLY DIRECT THE ASSE SSING OFFICER TO GRANT THE SAME. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED. 19. NOTHING CONTRARY WAS BROUGHT TO OUR KNOWLEDGE B Y THE REVENUE. ACCORDING TO US, THE RATIO OF APOORVA PRO PERTIES (SUPRA) SUPPORTS THE CASE OF THE ASSESSEE. WE FIND THAT IT AT PUNE A BENCH IN DCIT VS. ADITYA DEVELOPERS HAD OCCASION TO DISCUSS AND DECIDE THE SIMILAR ISSUE IN FAVOUR OF THE ASSESSEE BY OBSERVING AS UNDER: 6. WE HAVE CONSIDERED THE ABOVE SUBMISSIONS AND H AVE GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW, M ATERIAL AVAILABLE ON THE RECORD AND THE DECISIONS RELIED UP ON BY THE PARTIES. THE FACTS IN DETAILS SUBMITTED BY THE ASS ESSEE BEFORE THE A.O VIDE LETTER DATED 16.10.2006 HAVE ALSO BEEN GONE 25 THROUGH. FOR A READY REFERENCE, PARA NOS. 1 TO 8 O F THE LETTER DATED 16.10.2006 SUBMITTED BY THE ASSESSEE BEFORE T HE A.O ARE BEING REPRODUCED HEREUNDER: 1. M/S ADITYA DEVELOPERS PURCHASED A PLOT OF LAND BEARING SURVEY NO. 1/A(PART) OF KONDHWA KHURD, PUNE FROM RANADE AND THEIR RELATIVES. THEREAFTER M/S. A DITYA DEVELOPERS GOT THE CLEARANCE FROM URBAN AND LAND CE ILING DEPARTMENT VIDE ORDER DATED 17-8-1988. THEN WE GOT LAYOUT PLANS SANCTIONED FROM THE PMC VIDE ORDER DA TED 25-5-1990. AS PER THE TERMS OF THE ULC WE HAVE TO SHOW 25 S1.MTR COREHOUSE PLOTS AND BUILDING IN LAYOUT PL AN AND GET IT SANCTIONED FROM PMC. IF WE DONT IMPLEMENT THEIR ORDER AD SHOW THE VACANT LAND IN THE PLAN, THE ULC DEPARTMENT MIGHT HAVE INITIATED ACQUISITION PROCED URE. THE TOTAL LAND AREA WAS 28905 SQ.MTR. IT WAS NOT P OSSIBLE FOR US TO START CONSTRUCTION AND DEVELOPMENT OF EN TIRE LAND. SO WE STARTED DEVELOPMENT AND CONSTRUCTION O F FRONT AREA OF LAND. IN THE YEAR 1994, WE HAVE REQUESTED GOVT. OF MAHARASHTRA TO ACCEPT THE CONSIDERATION IN LIEU OF CERTAIN CONDITIONS STIPULATED IN THEIR ORDER FOR DELETING C ONSTRUCTION OF COREHOUSE PLOTS & SMALL AREA FLATS. AFTER A LON G HEARINGS THEY ACCEPTED OUR REQUEST AND ON PAYMENT M ADE, ISSUED US ORDER ON 14-12-1994 BECAUSE OF WHICH WE W ERE ENTITLED TO CANCEL THE CERTAIN BUILDING AND 112 CO RE HOUSES OF 25 SQ.M. PROPOSED FOR WEAKER SECTION. WE GOT OU R LAND REVERTED BACK FROM ULC DEPT. ON PAYMENT OF CONSIDER ATION TO GOVT. BY ORDER ON 14-12-1994. 2. WE HAVE COMPLETED THE DEVELOPMENT AND CONSTRUCTI ON OF THE BUILDINGS A,B,C,D,E,F,G,H & J ON PORTION OF LAND BEARING S.NO.1(PART), KONDHWA KHURD. 3. THEREAFTER THE PROVISION OF THE SECTION 80IB(10) CAME INTO FORCE. THE VACANT LAND AREA OF 8966 S1.MTR WAS AVAILABLE FOR THE NEW PROJECT WITH US. SO WE PLANN ED A NEW PROJECT AS PER THE NORMS OF PROVISIONS OF 80IB (10) ON VACANT LAND OF 8966 SQ.MTR AT S.NO.1(PART), KONDHWA , THE BUILDING PLANS WERE PREPARED IN SUCH A WAY THAT AR EA OF EACH UNIT WILL BE LESS THAN 1500 SQ.FT. WE GOT TH E BUILDING PLANS SANCTIONED ON 9-3-2001 AND 29-3-2001 AND WORK OF THE PROJECT STARTED ONLY AFTER THE BUILDING PLANS SANCTION IN MARCH 2001. IT IS VERY IMPORTANT TO NOTE THAT THE LAND OF 8966 SQ.MTR WAS VACANT AND ACCORDING TO RULES OF PMC (LOCAL AUTHORITY), ALL THE SANCTIONS PRIOR TO 9-3-2 001 & 29- 3-2001 GET CANCELLED AND LAPSED ON VACANT LAND OF 8 966 SQ.MTR. AT S.NO.1(PART) KONDHWA. 4. WE HAVE CONSTRUCTED THE BUILDINGS K,M,N,I,O & P ON VACANT LAND AT SURVEY NO. 1(A) (PART) KONDHWA KHURD , PUNE WHICH IS CARVED OUT SEPARATELY ON SITE. TDR U SED IS LESS THAN 40% OF AREA OF LAND OF 8966 SQ.MTR. WE G OT 26 SANCTIONED NEW BUILDING PLANS AS PER NORMS OF 80IB( 10) PROVISIONS IN MARCH 2001 & CONSTRUCTED ALL FLATS F OLLOWING ALL THESE NORMS. SINCE OUR NEW HOUSING PROJECT IS AS PER THE PLANS SANCTIONED IN MARCH 2001, IT IS NO WAY CONCERNED WITH EARLIER LAPSED SANCTIONS. WE HAVE N EVER STARTED ANY DEVELOPMENT OR CONSTRUCTION PRIOR TO MARCH 2001 ON THE REAR AREA OF LAND OF 8966 SQ.MTR ON WHI CH BUILDINGS K,M,N,I,O,P HAVE BEEN CONSTRUCTED. IN SU PPORT OF THIS WE ARE ENCLOSING HEREWITH PHOTOCOPY OF LETTER OF PMC DT. 5-10-2006. ENGLISH TRANSLATION OF THE SAME IS A S UNDER: PUNE MUNICIPAL CORPORATION CONSTRUCTION CONTROL DEPT. OUTWARD NO. BCO/5102 DATE: 5-10-2006 TO, M/S ADITYA DEVELOOERS, RESIDING AT SADASHIV PETH NO. 619,PUNE 30 SUB: REGARDING CONSTRUCTION ON S.NO.1(PART), KONDHWA, PUNE REF: YOUR LETTER DT. 3-10-2006 ON THE ABOVE MENTIONED SUBJECT AND UNDER THE LETTER REFERRED ABOVE, IT IS BEING INFORMED THAT PERMISSIO N FOR CONSTRUCTION OF K BUILDING AT S.NO. 1(PART) KONDHWA KHURD, PUNE WAS GIVEN VIDE NO. 4975 DT. 9-3-01 AND CERTIFICATE OF PLINTH CHECKING WAS GIVEN UNDER NO. BCO/03/74 DT. 27-9-2001. ALSO PERMISSION FOR BUILDING MNIOP WAS GIVEN VIDE LETTE R NO. 4981 DT. 29-3-2001 AS PER THE AVAILABLE RECOR D THERE IS NO MENTION OF ANY BUILDING CONSTRUCTION O F WHATSOEVER NATURE WAS FOUND ON THE LAND OF ABOVE BUILDINGS BEFORE SANCTIONING PERMISSION FOR ABOVE CONSTRUCTION. SD/- SD ASST. ENGINEER BUILDING INSPECTOR PUNE MUNICIPAL CORPORAT ION _________________________________________________ 5. CERTIFICATES OF OUR ARCHITECT DATED 14-10-2006 CONFIRMING THIS FACT IS ALSO ENCLOSED FOR YOUR CONSIDERATION. 6. THE TDR WAS PURCHASED FROM THE OPEN MARKET AND UTILIZED AS WELL AS DEBITED TO PROFIT & LOSS ACCOUNT IN BOOKS OF ACCOUNT WAS NOT MORE THAN 40% OF 8966 SQ.MTR. WE HAVE UTILIZED TDR BY PURCHASING IT FROM OUTSIDE LAND OWNERS FROM THE OPEN MARKET AND THEN PREVAILING MARKET PRICE. 27 7. WE HAVE BROUGHT ALL THESE FACTS TO NOTICE OF ASSESSING OFFICER DURING THE SCRUTINY OF OUR ACCOUN TS FOR A.Y. 2001-2002. IT IS CLEARLY EVIDENT IN THE ASSESSMENT ORDER OF A.Y. 2001-2002 THAT THE TWO PROJECTS ARE SEPARATE AND P/L ACCOUNT AS WELL AS WORKS IN PROGRESS ARE SEPARATELY SHOWN IN ASSESSMENT ORDER ALSO. 8. WE HAVE CONSTRUCTED ALL THE RESIDENTIAL UNITS EACH HAVING AREA OF LESS THAN 1500 SQ.FT. IN THE BUILDINGS K, M,N,I,O,P IN OUR NEW HOUSING PROJECT. IT IS NO WAY CONCERNED WITH THE RESIDENTIAL & COMMERCIAL UNIT OF EARLIER CONSTRUCTED BUILDING ON SEPARATE PORTION OF LAND AND SAME HAS BEEN REFLECTE D IN SEPARATE BOOKS OF ACCOUNTS AND WE HAVE ALREADY PAID TAXES ON IT. THE SUBMISSION OF THE LD. D.R. REMAINED THAT THE DE CISION OF PUNE BENCH IN THE CASE OF NIRMITI CONSTRUCTION VS. DCIT (SUPRA) FOLLOWED BY THE LD CIT(A), HAVING DIFFERENT FACTS IS NOT APPLICABLE IN THE CASE OF THE ASSESSEE. HAVING GON E THROUGH THAT DECISION, WE DO NOT AGREE WITH THE ABOVE CONTE NTION OF THE LD. D.R. THE DECISION FULLY COVERS THE CASE OF THE ASSESSEE ON THE ISSUE. IT APPEARS THAT THE WHOLE CONFUSION ON T HE ISSUE IN THE MIND OF THE A.O WAS DUE TO HIS UNDERSTANDING OF LAY OUT PLAN AND BUILDING PLAN ONE AND THE SAME THING, HENC E HE HAS COMMITTED ERROR IN TREATING THE DATE OF APPROVAL OF THE] LAY OUT PLAN BY THE MUNICIPAL CORPORATION AS THE DATE OF AP PROVAL OF THE BUILDING PLAN TO COMPUTE THE PERIOD OF COMPLETI ON OF THE BUILDING PLAN TO VERIFY THE ELIGIBILITY OF THE CLAI MED DEDUCTION U/S. 80IB(10) OF THE ACT. PUNE BENCH OF THE TRIBUN AL HAS OCCASION TO DISCUSS THE DISTINCTION BETWEEN THE LAY OUT PLAN AND BUILDING PLAN IN THE CASE OF NIRMITI CONSTRUCTI ON (SUPRA). IN THAT CASE BEFORE THE TRIBUNAL, THE LAY OUTS WERE FURNISHED TO THE MUNICIPAL CORPORATION FOR SANCTION ON 6 TH JUNE 1998 AND CONSTRUCTION WORK WAS COMMENCED AFTER BUILDING PERM ISSION WAS SANCTIONED BY THE MUNICIPAL CORPORATION ON 23 RD JULY 1999. DEPARTMENT TOOK THE STAND THAT THE DEVELOPME NT COMMENCED WITH THE DEVELOPMENT AGREEMENT AND ACQUIR ING IRRECOVERABLE POWER OF ATTORNEY AND MORE SO THAT LA Y OUTS WERE FURNISHED TO THE MUNICIPAL CORPORATION FOR PRELIMIN ARY SANCTION ON 6 TH JUNE 1998, THE ASSESSEES SUBMITTED THAT THE PRELIMINARY SANCTION WAS REQUIRED TO BE GIVEN WHICH CONSTITUTED NO OBJECTION FROM MUNICIPAL CORPORATI ON FOR ALLOWING ASSESSEE TO HAVE THE CONSTRUCTION ON THE S AID PROPERTY. IT WAS CONTENDED THAT ON THE BASIS OF PRELIMINARY SANCTION, THE ASSESSEE MADE AN APPLICATION FOR CONV ERTING THE SAID LAND INTO NON- AGRICULTURAL LAND. THIS APPLI CATION WAS MADE ON 25 TH NOVEMBER 1998 AND THE REVENUE AUTHORITIES CONVERTED THE SAID AGRICULTURAL LAND INTO NON-AGRIC ULTURAL LAND ON 13 TH JUNE 1999. IT WAS ALSO CONTENDED BY THE ASSESSEE THAT THE BUILDING PLAN WAS SUBMITTED TO THE MUNICIPAL C ORPORATION AND THE SAID CORPORATION SANCTIONED THE BUILDING PL AN ON 23 RD 28 JULY 1999. IN OTHER WORDS, THE MUNICIPAL CORPORATIO N GAVE THE PERMISSION OF CONSTRUCTION ON 23 RD JULY 1999. AFTER DISCUSSING THE CASES OF THE PARTIES, THE TRIBUNAL HAS ACCEPTED THE ABOVE CONTENTIONS OF THE ASSESSEE THAT THE HOUSING PROJEC T HAS BEEN APPROVED BY THE LOCAL AUTHORITY ON 23 RD JULY 1999 I.E. AFTER 1 ST OCTOBER1998, HENCE THE ASSESSEE WAS ELIGIBLE FOR TH E CLAIMED DEDUCTION U/S. 80 IB (10) OF THE ACT SINCE IT WAS FULFILLING ALL OTHER REQUIREMENTS OF THE PROVISIONS. 6.1. LIKEWISE, IN THE CASE OF VANDANA PROPERTIES VS. ACIT (SUPRA), THE MUMBAI BENCH OF THE TRIBUNAL HAS DECIDED THE ISSUE IN FAVOUR OF THE ASSESSEE . IN THAT CASE, THE ASSESSEE HAD PLAN FOR 4 INDEPENDENT BUILDINGS A,B, C & D BUT, SO FAR AS E IS CONCERNED ONLY PLANNED WHEN THE STATUS OF THE SURPLUS LAND WAS CONVERTED AS WITHIN CEILING LIMIT AND TH E ASSESSEE COULD GET ADDITIONAL FSI FOR LAUNCHING WING E . WING E WAS PLANNED AND CONSTRUCTION WAS COMMENCED AFTER 1 ST OCTOBER 1998 AND BUILDING/WING E WAS AN INDEPENDENT HOUS ING PROJECT AS CONTEMPLATED U/S. 80 IB (10). THE TRIBU NAL HELD THAT THE CONCEPT OF HOUSING PROJECT DOES NOT MEAN T HAT SHOULD BE THE GROUP OF THE BUILDINGS AND ONLY THEN SAME IS CALLED A HOUSING PROJECT . IT WAS FURTHER HELD THAT BUILDING/WING E CANNOT BE PASSED WITH EARLIER BUILDINGS I.E. A, B,C & D WHICH WORK WAS COMMENCED IN THE YEAR 1993 WHEREAS PLAN F OR WING E WAS APPROVED FOR ONLY ONCE IN THE YEAR 2002. IT WAS HELD FURTHER THAT THE CONCLUSION DRAWN BY THE AUTHORITIE S BELOW THAT THE COMMENCEMENT OF WING E IS A CONTINUATIO N OF THE EXISTING PROJECT IS ERRONEOUS. 6.2. IN THE CASE OF SAROJ SALES ORGANISATION VS. ITO (SUPRA) , THE MUMBAI BENCH HAS AGAIN EXPRESSED THE SAME VIEW AND HELD THAT THE COMMENCEMENT CERTIFICATES IN RESPECT OF THESE WINGS IN BLOCK N WERE SEPARATELY RECEIVED BY THE ASSESSEE AND ALL THE FLATS IN BLOCK N WERE OF LESS THAN 1 000 SQ.FT., HENCE IT IS NOT OPEN TO THE REVENUE TO INCLUDE BLOC K B, C AS PART OF BLOCK N JUST TO DENY RELIEF U/S. 80IB(10 ) OF THE ACT. THE BANGALORE BENCH OF THE TRIBUNAL HAS ALSO GOT O CCASION TO DISCUSS DISTINCTION BETWEEN THE SANCTION OF LAY OU T PLAN AND APPROVAL OF BUILDING PLANS BY THE LOCAL AUTHORITY F OR CONSIDERATION OF THE ELIGIBILITY OF U/S. 80 IB (10) DEDUCTION IN THE CASE OF DCIT VS. BRIGADE ENTERPRISES (P) LTD. ( SUPRA). IN THAT CASE BEFORE THE BANGALORE BENCH, THE ASSESSEE UNDERTOOK A DEVELOPMENT PROJECT IN AN AREA OF 22 ACRES 19 GUN TAS CONSISTING OF 5 RESIDENTIAL BLOCK RAW HOUSES, OAK TREE PLACE, A CLUB, AND COMMUNITY CENTRE, A SCHOOL, A PARK AND CL AIMED DEDUCTION U/S. 80 IB (10) IN RESPECT OF 2 RESIDENT IAL UNITS WHICH IF DEDUCTED SEPARATELY WERE ELIGIBLE FOR THE RELIEF. THE A.O TREATED THE ENTIRE PROJECT AS A SINGLE UNIT AND DENIED RELIEF U/S. 80 IB (10) IN ENTIRETY. THE TRIBUNAL JUSTIFIED THE ACTION OF THE LD CIT(A) IN ALLOWING RELIEF U/S. 80 IB(10) TRE ATING THE SAID 2 UNITS AS INDEPENDENT UNITS. THE TRIBUNAL OBSERVE D THAT THE GROUP HOUSING APPROVAL WAS APPROVAL OF A MASTER PL AN AS A 29 CONCEPT AND IF A PARTICULAR UNIT SATISFIES THE COND ITION OF SECTION 80 IB (10), THE ASSESSEE IS ENTITLED FOR DE DUCTION. THE TRIBUNAL HELD THAT PLAN FOR DEVELOPMENT WAS ONLY A WORK ORDER AND NOT FINAL PLANS SANCTIONED BY LOCAL AUTHORITY. FOR ANY PROJECT, THERE COULD NOT HAVE BEEN A PLAN WITHOUT SUBMISSION OF THE DETAILED BUILDING PLANS BY THE ARCHITECT A ND ON THE REQUISITE DETAILS REQUIRED TO BE SUBMITTED FOR APP ROVAL OF THE BUILDING PLANS BY THE LOCAL AUTHORITIES. IN OTHER WORDS, THE TRIBUNAL ACCEPTED THE CONTENTION OF THE ASSESSEE TH AT THE DEVELOPMENT PLAN IS ONLY CONCEPTUAL AND THE DETAILE D CONSTRUCTION PLANS ARE NOT SUBMITTED NOR APPROVED WITHOUT WHICH NO CONSTRUCTION CAN EVEN COMMENCE, AND THIS I S DONE ONLY SUBSEQUENTLY WHERE THE ASSESSEE SUBMITS THE CONSTRUCTION PLANS WHICH ARE APPROVED BY THE AUTHO RITY. THIS IS DONE FOR EACH PROJECT. THE PUNE BENCH IN THE CA SES OF APOORVA PROPERTIES AND ESTATE PVT. LTD. VS. DCIT, I TA NO. 113/PN/2007, A.Y. 2003-04, ORDER DATED 21ST AUGUST 2009 AND MUMBAI BENCH IN THE CASE OF MUDHIT MADANLAL GUP TA VS/ ACIT (SUPRA), 51 DTR (MUM ) TRIB 217 HAVE EXPRESSED THE SIMILAR VIEW. 7. THERE IS NO REASON TO DISPUTE ON FACTS IN THE PR ESENT CASE THAT INITIALLY THE PROPOSED BUILDINGS ( EXCEPT WING S I, M, N, O, P AND K IN THE PRESENT FORM) LAY OUT PLAN WAS APPRO VED 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 (PAG E NO. 5 OF THE PAPER BOOK). THE TOTAL AREA OF LAND WAS 28905 S Q. MTRS. THE ASSESSEE HAD FIRSTLY COMPLETED DEVELOPMENT AND CONSTRUCTION OF BUILDINGS A,B, C,D,E,F,G,H & J IN T HE AREA OF 17,392 SQ. MTRS OF PROJECT KKN, LEAVING THE LAND A REA OF 8966 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 RESIDEN TIAL 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 RESPECTI VELY. COPY OF BUILDING PLAN APPROVED ON 9.3.2001 HAS BEE N MADE AVAILABLE AT PAGE NO. 104 OF THE PAPER BOOK, WHEREA S THE BUILDING PLAN APPROVED ON 29.3.2001 HAS BEEN MADE A VAILABLE AT PAGE NO. 103 OF THE PAPER BOOK. THERE IS NO DI SPUTE 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 DEF INITION OF HOUSING PROJECT IS ANY PROJECT WHICH HAS BEEN APP ROVED BY THE LOCAL AUTHORITY AS A HOUSING PROJECT SHOULD B E 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 EXPLANATI ON (I) TO THE SECTION IS BEING REPRODUCED HEREUNDER : 30 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 PRO JECT IS APPROVED SHALL BE DEEMED THE DATE OF APPROVAL OF TH E HOUSING PROJECT. WE THUS FIND THAT THE ASSESSEE IS VERY MUC H ELIGIBLE FOR THE CLAIMED DEDUCTION U/S. 80 IB (10) ON THE PR OJECT KKT IN VIEW OF THE ABOVE CITED DECISIONS INCLUDING DECI SION OF PUNE BENCH OF THE TRIBUNAL IN THE CASE OF NIRMITI CONSTR UCTION VS. DCIT (SUPRA), FOLLOWING WHICH, IN OUR VIEW, THE LD CIT(A) HAS RIGHTLY ALLOWED THE CLAIMED DEDUCTION. THE SAME I S UPHELD. THE ISSUE RAISED ARE THUS DECIDED IN FAVOUR OF THE ASSESSEE. 8. SO FAR AS DECISION OF CHENNAI BENCH OF THE TRIBU NAL IN THE CASE OF ACIT VS. VISWAS PROMOTERS (P) LTD. (SUP RA) RELIED UPON BY THE LD. D.R. IS CONCERNED, WE FIND THAT THE FACTS THEREIN ARE DISTINGUISHABLE AS IN THAT CASE, ASSES SEE HAD COMPLETED 4 HOUSING PROJECTS, OUT OF THOSE 4 PROJE CTS, IN 2 PROJECTS ASSESSEE HAD CONSTRUCTED FLATS EXCEEDING 1 500 SQ.FT. AND ALSO FLATS OF LESS THAN 1500 SQ.FT. IN AREA, T HE ASSESSEE CLAIMED DEDUCTION U/S. 80 IB (10) IN RESPECT OF FLA TS HAVING AREA LESS THAN 1500 SQ.FT., A.O. DENIED SAID DEDUCT ION ON THE GROUND THAT HOUSING PROJECT COMPRISED OF RESIDENTIA L UNITS EXCEEDING 1500 SQ. FT., THUS ALL CONDITIONS STIPULA TED IN STATUTE WERE NOT SATISFIED. THE TRIBUNAL HAS JUST IFIED THE ACTION OF THE A.O. THIS DECISION IS THUS NOT RELEV ANT IN THE FACTS OF THE PRESENT CASE WHEREIN THE PROJECT KKT IS FULFILLING ALL THE REQUIREMENTS OF SEC. 80 IB(10) OF THE ACT A ND APPROVAL TO THE BUILDING PLANS OF THE PROJECT WERE GIVEN SEP ARATELY BY THE MUNICIPAL CORPORATION FROM THE EARLIER PROJECT KKN. THE GROUNDS ARE THUS REJECTED. 9. IN RESULT, APPEALS ARE DISMISSED. 20. OUR FINDING IS FORTIFIED BY THE RATIO LAID DOWN BY THE ITAT PUNE BENCH IN ADITYA DEVELOPERS DISCUSSED ABOVE. WE ALS O FIND THAT ITAT PUNE BENCH IN DCIT VS. ANKIT ENTERPRISES HAD O CCASION TO DECIDE SIMILAR ISSUE AND TAKING ALL FACTS AND CIRCU MSTANCES INTO CONSIDERATION, DECIDED THE SIMILAR ISSUE IN FAVOUR OF ASSESSEE WHEREIN SANCTION OF BUILDING PLAN HAS BEEN MADE BAS IS FOR HOLDING INDEPENDENT PROJECT FOR THE PURPOSE OF CLAIMING DED UCTION U/S.80IB(10). WE FIND THAT ITAT PUNE BENCH IN P.V .MAHADKAR & 31 ASSOCIATES IN ITA NO.1117/PN/2010 HAS DISCUSSED AND DECIDED SIMILAR ISSUE IN FAVOUR OF ASSESSEE BY OBSERVING AS UNDER: 6. AFTER GOING THROUGH THE RIVAL SUBMISSIONS AND T HE MATERIAL ON RECORD, WE FIND THAT IT IS UNDISPUTED T HAT THE ORIGINAL KEY PLAN WAS SUBMITTED ON 1-10-1998. THE SAID PROJECT WAS SANCTIONED IN THE NAME OF SMT SUNITA MA HADKAR WITH REGARDS TO WHOLE OF LAND IN QUESTION AND THE S AID KEY PLAN WAS REVISED ON 8-1-2001. SUBSEQUENT TO THIS, THE A SSESSEE ENTERED INTO DEVELOPMENT RIGHTS WITH REGARDS TO THE PROJECT IN QUESTION AND THE SAID DEVELOPMENT RIGHT OF THE LAND ITSELF WAS ACQUIRED BY THE ASSESSEE ON 2-8-2004. PLOT OF THIS DEVELOPMENT RIGHT WAS PART OF KEY PLAN SUBMITTED ON 1-10-998 AS MENTIONED ABOVE. SUBSEQUENTLY, THE BUILDING PLAN/COMMENCEMENT CERTIFICATE WAS GRANTED BY THE PM C ON 8- 10-2004. THE DATE OF 8-1-2001 WAS MERELY THE DATE WHEN MRS. SUNITA MAHADKAR, THE ORIGINAL OWNER OF THE LAN D HAD GOT HER REVISED ITS LAYOUT PLAN AFTER THE SAID AREA WAS INCLUDED WITHIN THE PMC LIMITS. AS THE ASSESSEE HAD GOT THE BUILDING PLAN APPROVED ON 8-10-2004 AS DISCUSSED ABOVE, IN ACCORDANCE WITH THE PROVISIONS OF SECTION 80-IB(10 )(A)(II) OF THE ACT THE TIME WAS AVAILABLE UPTO 31-3-2009 FOR COMPL ETION OF THE PROJECT WHICH IS EVIDENT FROM THE COMPLETION CE RTIFICATE ISSUED BY THE PMC ON 3-7-2008. THIS FACT HAS NOT B EEN DISPUTED BY THE REVENUE AUTHORITIES, BECAUSE THE AS SESSING OFFICER HIMSELF MADE AN INQUIRY DIRECTLY WITH THE P MC VIDE HIS LETTER DATED 12-12-2008. LAYOUT/KEY PLAN DATED 1-10 -1998 WAS IN RESPECT OF WHOLE PROPERTY OF EARLIER OWNER S MT. SUNITA MAHADKAR. LAY OUT PLAN/KEY PLAN IS DIFFERENT FROM SANCTION OF PLAN AND COMMENCEMENT THEREOF. ASSESSEE ENTERED IN TO DEVELOPMENT AGREEMENT DATED 2-8-2004 WITH REGARDS T O PORTION OF PROPERTY OF SMT. SUNITA MAHADKAR. SO TH ERE IS NO QUESTION OF ANY SANCTION AND COMMENCEMENT PRIOR TO IT. THE COMMENCEMENT TOOK PLACE ON THIS PROPERTY OF ASSESSE E ADMEASURING 52245 SQ.FT. OUT OF HOLDING OF SMT. SUN ITA MAHADKAR ACQUIRED BY ASSESSEE VIDE DEVELOPMENT AGRE EMENT DATED 28-2004. SO, THERE WAS NO QUESTION OF COMMEN CEMENT PRIOR TO 2-8-2004. THE DATE OF LAYOUT OF PREVIOUS OWNER I.E. 1-10-1998 SHOULD NOT BE CONFUSED WITH DATE OF SANCT ION OF PLAN AND COMMENCEMENT THEREOF AS HELD IN THE CASE O F ADITYA DEVELOPERS (SUPRA). CONSIDERING ALL THE FACTS AND CIRCUMSTANCES, WE ARE NOT INCLINED TO INTERFERE WIT H THE FINDINGS OF THE CIT(A) WHO HAS DELETED THE ADDITION OF RS. 32,30,904/- MADE BY THE ASSESSING OFFICER BY WAY OF DISALLOWING THE ASSESSEES CLAIM OF DEDUCTION U/S 8 0-IB(10) OF THE ACT. 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. 32 21. IN VIEW OF ABOVE, PROJECT KUMAR KRUTI WAS INDEP ENDENT PROJECT SINCE BUILDING PLAN OF THE SAID PROJECT WAS SANCTIO NED INDEPENDENTLY ON 26.07.2006. IN THESE FACTS AND CI RCUMSTANCES, REVENUE AUTHORITIES BELOW WERE NOT JUSTIFIED IN HOL DING THAT PROJECT KUMAR KRUTI IS A PART OF KUMAR CITY PROJECT. OTHER POINT ON WHICH THE ASSESSING OFFICER HAS DENIED THE DEDUCTION IS T HAT COMMERCIAL AREA IN SAID PROJECT EXCEEDED THE LIMITS PRESCRIBED U/S.80IB(10). SINCE WE HAVE HELD THAT PROJECT KUMAR KRUTI IS INDE PENDENT OF KUMAR CITY PROJECT, AND THERE IS NO COMMERCIAL AREA IN PROJECT KUMAR KRUTI, THEN THERE IS NO QUESTION OF VIOLATING THE LIMITS OF COMMERCIAL AREA AS PRESCRIBED U/S.80IB(10) WITH REG ARD TO DEDUCTION OF CLAIM U/S.80IB(10) IN RESPECT OF PROJE CT KUMAR KRUTI IN QUESTION. REGARDING PRORATA DEDUCTION U/S.80IB(10) OF THE ACT, WE HAVE ALREADY HELD THAT THE ASSESSEE IS ELIGIBLE FOR DEDUCTION IN RESPECT OF ELIGIBLE FLATS NOT EXCEEDING PRESCRIBED LIMIT OF 1500 SQ.FT. AFTER EXCLUDING FLATS EXCEEDING 1500 SQ.FT. AND THE ASSESSING OFFICER HAS BEEN DIRECTED TO REWORK DEDUCTION ACCORDINGLY. IN VIEW OF ABOVE, THE ASSESSING OFFICER IS DIRECTED TO ALLOW T HE CLAIM OF ASSESSEE IN RESPECT OF PROJECT KUMAR KRUTI FOR THE REASONS DISCUSSED ABOVE. 22. AS A RESULT, THIS APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. 23. IN ITA.NO.2210/PN/2012, FOR A.Y. 2009-10, THE A SSESSEE HAS RAISED FOLLOWING GROUNDS: 1 (A) THE LEARNED CIT(A) ERRED IN DENYING THE DEDUC TION CLAIMED U/S 80IB(10) OF RS.10,29,34,512/- IN RESPECT OF THE PROJECT KUMAR KRUTI ON THE GROUND THAT THE SAID PROJECT DID NOT SATISFY THE CONDITIONS LAID DOWN U/S 80IB(10). THE AO AND CIT(A) MAY PLEASE BE DIRECTED TO ALLOW THE DEDUCTION CLAIMED U/S 80IB(10) OF RS. 10,29,34,512/ - FOR PROJECT KUMAR KRUTI. (B) WITHOUT PREJUDICE TO THE ABOVE GROUND, ASSUMING WITHOUT ADMITTING THAT THE CONDITION OF BUILT UP AREA IS NO T SATISFIED FOR FEW FLATS, I.E. THE BUILT UP AREA OF FEW FLATS EXCEEDED 1500 SQ.FT, THE APPELLANT SUBMITS THAT THE DEDUCTIO N U/S 80IB (10) SHOULD HAVE BEEN ALLOWED ON PROPORTIONATE BASIS 33 IN RESPECT OF THE BALANCE FLATS WHOSE BUILT UP AREA WAS LESS THAN 1500 SQ.FT. 2 (A) THE LEARNED CIT (A) ERRED IN DISALLOWING THE DEDUCTION U/S 80IB(10) OF RS.4,17,74,015 /- CLAIMED IN RESPECT OF THE PROJECT KUMAR SHANTINIKETAN ON THE GROUND THAT THE SAID PROJECT DID NOT SATISFY THE CONDITIONS LAID DOWN U/ S 80IB(10). THE AO AND CIT(A) MAY PLEASE BE DIRECTED TO ALLOW T HE DEDUCTION CLAIMED U/S 80IB(10) OF RS.4,17,74,015/- FOR PROJECT KUMAR SHANTINIKETAN. (B) WITHOUT PREJUDICE TO THE ABOVE GROUND, ASSUMIN G WITHOUT ADMITTING THAT THE CONDITION OF BUILT UP AREA IS NO T SATISFIED FOR FEW FLATS, I.E. THE BUILT UP AREA OF FEW FLATS EXCEEDED 1500 SQ.FT, THE APPELLANT SUBMITS THAT THE DEDUCTIO N U/S 80IB (10) SHOULD HAVE BEEN ALLOWED ON PROPORTIONATE BASIS IN RESPECT OF THE BALANCE FLATS WHOSE BUILT UP AREA WAS LESS THAN 1500 SQ.FT. THE FIRST ISSUE IS WITH REGARD TO PRORATA CLAIM OF DEDUCTION U/S.80IB(10) IN RESPECT OF ELIGIBLE FLATS IN THE PR OJECT KUMAR KRUTI WHILE FEW FLATS EXCEEDED THE PRESCRIBED LIMIT OF 15 00 SQ.FT. THE ISSUE OF PRORATA DEDUCTION HAS BEEN ALLOWED BY US I N A.Y. 2008-09 VIDE PARA 16 OF THIS ORDER. FACTS BEING SIMILAR, T HE ASSESSING OFFICER IS DIRECTED TO REWORK THE DEDUCTION IN RESP ECT OF ELIGIBLE FLATS AS DISCUSSED ABOVE. 24. THE NEXT ISSUE PERTAINS TO DISALLOWANCE OF DEDU CTION U/S.80IB(10) IN RESPECT OF PROJECT KUMAR SHANTINIKE TAN AND THE ALTERNATE PLEA OF ELIGIBILITY ON PROPORTIONATE BASI S WITH REGARD TO ELIGIBLE FLATS AS PER PROVISIONS OF SECTION 80IB(10 ) OF THE ACT. THIS ISSUE OF PROPORTIONATE DEDUCTION HAS BEEN DISCUSSED AND DECIDED IN FAVOUR OF THE ASSESSEE VIDE PARA 9 OF THIS ORDER. FACTS BEING SIMILAR SO FOLLOWING SAME REASONING ASSESSING OFFICER IS DI RECTED TO REWORK DEDUCTION ON PRORATA BASIS WITH REGARD TO ELIGIBLE FLATS AFTER EXCLUDING FLATS EXCEEDING PRESCRIBED LIMIT LAID DOW N UNDER THE PROVISIONS OF SECTION 80IB(10) OF THE ACT. 25. IN THE RESULT, BOTH THE APPEALS OF THE ASSESSEE ARE PARTLY ALLOWED AS INDICATED ABOVE. 34 PRONOUNCED IN THE OPEN COURT ON THIS THE 15 TH DAY OF APRIL, 2013. SD/- SD/- ( G.S.PANNU ) ( SHAILENDRA KUMAR YAD AV ) ACCOUNTANT MEMBER JUDICIAL MEMBER GSPS PUNE, DATED THE 15 TH APRIL, 2013 COPY OF THE ORDER IS FORWARDED TO: 1. THE ASSESSEE 2. THE ACIT, CIRCLE-4, PUNE AND ITO, WARD-4(5), PUNE. 3. THE CIT(A)-II, PUNE. 4. THE CIT-II, PUNE. 5. THE DR A BENCH, PUNE. 6. GUARD FILE. BY ORDER //TRUE COPY// PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, PUNE.