Sudhir Mandke Family (HUF), Pune V. ACIT, Circle 3, Pune, Pune

ITA 1369/PUN/2009

• Counselvise Citation: 136924514 RSA 2009
• Duration Of Justice: 1 year(s) 11 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 17-10-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 01-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K AMBASTHA
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE BEFORE SHRI I.C. SUDHIR, JUDICIAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER ITA NO. 1369/PN/2009 (ASSTT. YEAR: 2005-06) SUDHIR MANDKE FAMILY (HUF) , ... APPELLANT 1132/2, ALANKAR BHAVAN, F.C. ROAD, SHIVAJI NAGAR, PUNE 411 016 PAN : NOT AVAILABLE V. ACIT, CIRCLE 3, PUNE RESPONDENT APPELLANT BY : SHRI NIKHIL PATHAK RESPONDENT BY : SHRI S.K. AMBASTHA DATE OF HEARING :17.10.11 DATE OF PRONOUNCEMENT: .11.11 ORDER PER I.C. SUDHIR, JM THE ASSESSEE HAS QUESTIONED FIRST APPELLATE ORDER ON THE FOLLOWING GROUNDS : 1] THE LEARNED CIT(A) ERRED IN CONFIRMING THE DIS ALLOWANCE OF DEDUCTION OF RS34,95,260/- U/S 80IB(10) CLAIMED IN RESPECT OF PROJECT ONLY ON THE GROUND THAT THE SAID PROJECT CONSISTED OF LITTLE CO MMERCIAL AREA AND THEREFORE, THE SAID PROJECT WAS NOT A HOUSING PROJECT ELIGIBLE FOR DEDUCTION U/S 80IB(10). 1.1] THE LEARNED CIT(A) ERRED IN HOLDING THAT THE A MENDMENT RESTRICTING THE COMMERCIAL AREA INCLUDIBLE IN THE HOUSING PROJE CT WAS APPLICABLE FROM A.Y. 2005-06 ALTHOUGH THE PROJECT WAS STARTED BEFOR E THE INSERTION OF THE AMENDMENT AND THEREFORE, AS A CONSEQUENCE, HE ERRED IN HOLDING THAT THE ASSESSEE WAS NOT ENTITLED TO CLAIM THE DEDUCTION IN RESPECT OF THE PROFITS OF ANUBHAV PROJECT FOR THIS YEAR . 1.2] THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED T HAT - ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 2 A. SIMPLY BECAUSE THE PROJECT ANUBHAV CONSISTED OF COM MERCIAL AREA OF 7384 SQ.FT., THE SAME WAS STILL A HOUSING PROJEC T AND ELIGIBLE FOR DEDUCTION U/S 80IB(10). B. THE PROJECT ANUBHAV WAS STARTED IN F.Y. 2002 I. E. MUCH PRIOR TO THE INSERTION OF THE AMENDMENT RESTRICTING THE TOTAL CO MMERCIAL AREA AND THEREFORE, SINCE THE PROJECT WAS STARTED PRIOR TO T HE AMENDMENT, THERE WAS NO RESTRICTION ON THE COMMERCIAL AREA INCLUDIBL E IN THE HOUSING PROJECT. C. THE AMENDMENT RESTRICTING THE TOTAL COMMERCIAL A REA IN THE HOUSING PROJECT WAS NOT RETROSPECTIVE AND WAS APPLICABLE ON LY TO THE PROJECTS WHICH HAD COMMENCED CONSTRUCTION AFTER THE INSERTIO N OF THE AMENDMENT AND ACCORDINGLY, THERE WAS NO REASON TO D ENY THE DEDUCTION IN RESPECT OF THE PROFITS FOR THIS YEAR. 2] THE ASSESSEE SUBMITS THAT THE COMMERCIAL AREA C ONSTRUCTED BY THE ASSESSEE IN THE ABOVE REFERRED PROJECT WAS LESSER T HAN 10% OF THE TOTAL BUILT UP AREA OF THE PROJECT AND THEREFORE, THE DEDUCTION U/S. 80IB(10) WAS ALLOWABLE IN VIEW OF THE SPECIAL BENCH ITAT DECISIO N IN THE CASE OF BRAHMA ASSOCIATES. 3] WITHOUT PREJUDICE, THE ASSESSEE PRAYS FOR THE DE DUCTION U/S. 80IB(10) IN RESPECT OF THE PROFITS FROM THE RESIDENTIAL PORT ION OF THE ABOVE TWO PROJECTS. GROUND NOS. 1, 1.1, 1.2 AND 2 2. IN GROUND NOS. 1,1.1, 1.2 AND 2, THE ISSUE INVOL VED IS AS TO WHETHER LD CIT(A) WAS JUSTIFIED IN CONFIRMING THE DISALLOWANCE OF DEDUCTION OF RS.34,95,260/- U/S. 80 IB(10) CLAIMED IN RESPECT OF A PROJECT CON SISTING RESIDENTIAL AS WELL AS COMMERCIAL TO SOME EXTENT IN VIEW OF THE AMENDED P ROVISIONS U/S. 80 IB(10) W.E.F. 1.4.2005. IN GROUND NO.3, AN ALTERNATIVE PRAYER HA S BEEN MADE FOR ALLOWING DEDUCTION U/S. 80IB(10) IN RESPECT OF PROFITS FROM THE RESIDENTIAL PORTION OF THE 2 PROJECTS. ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 3 3. AT THE OUTSET OF HEARING, THE LD. A.R. POINTED O UT THAT THE ISSUE IS FULLY COVERED BY THE DECISION OF PUNE BENCH OF THE TRIBUN AL IN THE CASE OF M/S. TUSHAR DEVELOPERS VS. ITO, ITA NOS. 165/PN/2007 & 94/PN/ 2008 (A.YS. 2003-04 AND 2004-05), ORDER DATED 31 ST MAY 2011 AND DECISION IN THE CASE OF OPEL SHELTERS PVT. LTD. VS. ACIT & D.S. KULKARNI & ASSOCIATES, ITA N OS. 17 AND 219/PN/2009 (A.Y. 2005-06), ORDER DATED 31 ST MAY 2011. HE ALSO POINTED OUT THAT SO FAR AS APPLI CABILITY OF AMENDED PROVISION U/S. 80IB (10) WITH PROSPECTIV E EFFECT IS CONCERNED, IT IS FULLY COVERED BY THE DECISION OF HONBLE JURISDICTIONAL H IGH COURT IN THE CASE OF BRAHMA ASSOCIATE, IN ITA NO. 1194 OF 2010, ORDER DATED 22. 2.2011 WHEREBY THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL REPORTED IN 119 I TD 255 (SB) (PUNE) HAS BEEN UPHELD ON THE ISSUE. THE LD. A.R. POINTED OUT THAT THE PROJECT ANUBHAV WAS STARTED IN F.Y. 2002 I.E. PRIOR TO INSERTION OF THE AMENDMENT IN S. 80IB(10) AND IT WAS COMPLETED WELL BEFORE 31 ST MARCH 2008. HE FURTHER POINTED OUT THAT THE SAME PROJECT ANUBHAV WAS ALSO THE SUBJECT MATTER OF DI SALLOWANCE IN THE A.Y. 2004-05 BY THE A.O ON THE BASIS THAT THE PROJECT INCLUDED THE COMMERCIAL AREA. THE SAME WAS UPHELD BY THE FIRST APPELLATE AUTHORITY, BUT TH E TRIBUNAL VIDE ITS ORDER DATED 18.8.2009 IN ITA 1536/PN/2007, HAS ALLOWED THE CL AIMED DEDUCTION RELYING ON THE DECISION OF SPECIAL BENCH OF THE TRIBUNAL IN THE CA SE OF BRAHMA ASSOCIATES & OTHERS (SUPRA). 4. THE LD. D.R. ON THE OTHER HAND TRIED TO JUSTIFY THE ORDERS OF THE AUTHORITIES BELOW. HE SUBMITTED THAT THE AMENDED PROVISIONS U/ S. 80 IB(10) CAME INTO EFFECT FROM 1.4.2005, HENCE IT WAS VERY MUCH APPLICABLE IN THE CASE OF ASSESSEE FOR THE A.Y. 2005-06. THE LD. D.R. HAS ALSO FILED THE WRIT TEN SUBMISSION DATED 10.8.2011 WHEREIN HE HAS TRIED TO DISTINGUISH THE DECISIONS R ELIED UPON BY THE LD. A.R. ESPECIALLY THE DECISION IN THE CASE OF OPEL SHELTE RS & D.S. KULKARNI & ASSOCIATES (SUPRA) WITH THE SUBMISSION THAT IN THOSE CASES, P ROJECTS WERE COMPLETED WELL BEFORE 1.4.2005 AND DUE TO THIS REASON ALSO, THE B ENCH BEING SYMPATHETIC TO THE HARDSHIPS TO THE ASSESSEE FOR DENIAL OF DEDUCTION FOR A.Y. 2005-06, HAD ALLOWED THE ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 4 CLAIMED DEDUCTION. THE LD. D.R. ARGUED FURTHER THA T TRIBUNAL IS NOT BOUND TO FOLLOW ITS EARLIER DECISION IF IT IS NOT CORRECT POSITION OF LAW. IN THIS REGARD, HE PLACED RELIANCE ON THE FOLLOWING DECISIONS : (I) CIT VS. HI TECH ARAI LTD. 321 ITR 477(MAD.) (II) UNION OF INDIA VS. RAGHUBIR SINGH 178 ITR 548 (SC) (III) SRI AGASTHYAR TRUST, 236 ITR 23 (SC) 5. HAVING GONE THROUGH THE ORDERS OF THE AUTHORITIE S BELOW WE FIND THAT THE A.O DENIED CLAIMED DEDUCTION OF RS/. 34,95,260/- MADE U /S. 80 IB(10) IN RESPECT OF PROFIT EARNED FROM THE ASSESSEES PROJECT ANUBHAV AT KOTHRUD, PUNE ON THE GROUND THAT THE HOUSING PROJECT WAS ALSO HAVING COMMERCIAL AREA THAT TOO EXCEEDING THE LIMIT PRESCRIBED UNDER THE AMENDED PROVISIONS U/S. 80 IB(10) CAME INTO EFFECT FROM THE A.Y. 2005-06. WE NOTE FROM THE ORDERS OF THE A UTHORITIES BELOW THAT THE PROJECT ANUBHAV (THE PROJECT) WAS STARTED IN JANUARY 2002 . THE TOTAL RESIDENTIAL AREA CONSTRUCTED WAS 70,522/- SQ FT. AND THE COMMERCIAL AREA CONSTRUCTED WAS 7384 SQ. FT. THUS, THE COMMERCIAL AREA CONSTRUCTED WAS 9.47 % OF THE TOTAL CONSTRUCTED AREA. THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL I N THE CASE OF BRAHMA ASSOCIATE & OTHERS (SUPRA) IS RELATING TO THE A.Y. 2004-05 WHE N ADMITTEDLY, THE AMENDED PROVISIONS U/S.80 IB(10) W.E.F. 1.4.2005, WAS NOT I N OPERATION. BY THIS AMENDMENT, CLAUSE (D) WAS INSERTED IN SECTION 80IB (10) IMPOSI NG A RESTRICTION ON THE COMMERCIAL AREA TO 5% OF BUILT UP AREA OR 2000 SQ. FT. WHICHEVER IS LOWER. REFERRING THIS PROVISION, THE LD CIT(A) HELD THAT I T IS APPLICABLE IN THE A.Y. 2005-06 AND SINCE IN THE CASE OF ASSESSEE, COMMERCIAL AREA EXCEEDS 2000 SQ.FT. OF THE BUILT UP AREA, IT IS IN VIOLATION OF PROVISION OF SECTION 80 IB (10)(D) OF THE ACT. THUS, THE A.O HAS RIGHTLY DISALLOWED THE CLAIMED DEDUCTION U/ S. 80IB(10) (D) OF THE ACT TO THE ASSESSEE, HELD THE LD. CIT(A). THE LD CIT(A) HAS A LSO DISCUSSED THE DECISIONS RELIED UPON BEFORE HIM INCLUDING THE DECISION OF SPECIAL B ENCH OF THE TRIBUNAL IN THE CASE OF BRAHMA ASSOCIATE (SUPRA). HE HAS OBSERVED THAT THE DECISION OF THE SPECIAL BENCH DECISION DOES NOT RELATE TO A.Y. 2005-06 AND AFTERWARDS, WHEN THE ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 5 AMENDMENT HAD ALREADY BEEN INTRODUCED AS DISCUSSED IN PARA NO. 7 OF THE SAID DECISION. WE FIND THAT THE PUNE BENCH OF THE TRIBU NAL UNDER ALMOST SIMILAR FACTS AND ON AN IDENTICAL ISSUE HAS OCCASION TO DECIDE TH E CASES OF OPEL SHELTERS PVT. LTD. VS. ACIT AND D.S. KULKARNI & ASSOCIATES (SUPRA) PR EFERRED AGAINST THE SIMILAR DISALLOWANCE IN THE A.Y. 2005-06 RELIED UPON BY TH E LD. A.R. THE RELEVANT PARA NOS. 19 & 20 OF THE SAID DECISION ARE BEING REPRODU CED HEREUNDER FOR A READY REFERENCE : 19. WE, THUS, FIND THAT THE ISSUES RAISED IN THE PRESENT APPEALS ARE FULLY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF HIRANAN DANI AKRUTI J.V V/S. DCIT (SUPRA). RESPECTFULLY FOLLOWIG THE SAID DECISION IN THE CASE OF HIRANANDANI AKRUTI J.V. (SUPRA), WE DECIDE THE ISSUES IN FAVOUR OF THE ASSESSEES THAT A HOUSING PROJECT WILL ALSO CONSIST OF COMMERCIAL AREA TO A PERMISSIBLE LIMIT, AS SETTLED BY THE SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF BRAMHA ASSOCA TES (SUPRA) (NOW UPHELD BY THE HONBLE BOMBAY HIGH COURT) AS APPLICABLE UPTO A.Y. 2004-05. AND SECONDLY, THE LAW AS IT EXIS TED IN THE ASSESSMENT YEAR WHEN THE ASSESSEE SUBMITTED ITS PRO POSAL OF THE PROJECT AND PERMISSION FOR THE SAME WAS ACCORDED TO AND WHEN THE ASSESSEE COMMENCED THE PROJECT IS TO BE APPLIED. I N THE PRESENT CASE, UNDISPUTEDLY THE ASSESSEES HAD STARTED THE PR OJECT IN THE YEAR 2001 WHEN SUB-CLAUSE (D) TO SECTION 80IB(10) WAS N OT IN EXISTENCE, HENCE IT CANNOT BE APPLIED ON SUCH PROJE CTS AS HELD BY THE MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF HIR NANDANI AKRUTI J.V. (SUPRA). IN THIS REGARD, WE ALSO FIND STRENGT H FROM THIS PLEA OF THE LD. A.R. WHICH WAS ALSO RAISED BEFORE IN THE C ASE OF HIRANANDANI AKRUTI J.V. THAT IF THE ASSESSEE HAD FO LLOWED WIP (WORK-IN-PROGRESS) METHOD, THE INCOME FROM THE PROJ ECT WOULD HAVE BEEN TAXABLE IN THE EARLIER YEARS AS THE PROJ ECT WAS COMPLETED EARLIER TO THE AMENDMENT AND IN THAT CASE , AS PER THE OLD PROVISION THE ASSESSEE WOULD HAVE BEEN ELIGIBLE FOR THE DEDUCTION. BUT, JUST BECAUSE THE ASSESSEE HAS FOLL OWED THE PROJECT COMPLETION METHOD, IN THESE CASES, THE DEDUCTION I S BEING DENIED BECAUSE IT FALLS IN A.Y. 2005-06. IN OUR VIEW THE N EWLY INSERTED CLAUSE (D) TO SECTION 80IB(10) WILL NOT APPLY ON TH E PROJECTS APPROVED UPTO 31.3.05 SINCE IN THOSE PROJECTS ASSES SEES ARE ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 6 REQUIRED TO CONSTRUCT WHAT HAS BEEN APPROVED. THE ONLY FISSIBLE COMPLIANCE IS REQUIRED TO BE MET AS PER THE HARMONI OUS INTERPRETATION OF SECTION 80IB(10) AS AMENDED IS T O COMPLETE SUCH PROJECTS (APPROVED BEFORE 1.4.2004) ON OR BEFORE 31 .3.2008. IN THE CASES BEFORE US THE PROJECTS HAVE BEEN COMPLETE D WELL BEFORE THIS DATE. PUTTING OF SUCH CONDITION OF TIME LIMIT IS WELL UNDERSTOOD. SINCE THE LEGISLATURE INTENDED THE COMPLETION OF PR OJECTS WITHIN A TIME FRAME TO AVOID INCONVENIENCE TO THE BENEFICIAR IES I.E. THE BUYERS. IN THIS REGARD THE LEGISLATURE HAS CATEGOR ISED THE TIME LIMIT FOR THE PROJECTS APPROVED ON DIFFERENT PERIOD BEFOR E 31.3.2007 BUT REQUIREMENT REMAINED THE SAME THAT PROJECTS WOULD B E APPROVED BY THE LOCAL AUTHORITY. COMPLIANCE OF THE REQUIREM ENT PROVIDED IN CLAUSE (D) TO THE SECTION IS POSSIBLE ONLY IN THOSE PROJECTS WHICH HAVE BEEN STARTED ON OR AFTER 1.4.2005 AS BY THEN T HOSE ASSESSEES WERE ALL AWARE ABOUT THE PROVISIONS LAID DOWN IN CL AUSE (D). 20. BY APPLYING THE PRINCIPLE OF HARMONIOUS CONSTRU CTION TO INTERPRET THE PROVISIONS UNDER SUB-SECTION (10) TO SECTION 80IB AS AMENDED W.E.F. 1.4.2005 WE COME TO THE CONCLUSION T HAT THE LEGISLATURE ALWAYS INTENDED THAT THE PROJECT MUST B E APPROVED BY THE LOCAL AUTHORITY, THUS IN THOSE APPROVED PROJECT S WHERE CONSTRUCTION HAS BEEN STARTED MUCH EARLIER THAN 1.4 .2005, THE ASSESSEES ARE REQUIRED TO COMPLETE THE PLAN AS IT H AS BEEN APPROVED. AS PUTTING SUCH ASSESSEES TO COMPLETE TH E PLAN MEETING OUT CONDITION UNDER CLAUSE (D) OF THE SUB-SECTION W OULD LEAD INTO ABSURDITY AND IMPOSSIBILITY FOR THE ASSESSEE AND I N CONTRADICTION TO THE PROVISIONS U/S. 80 IB(10) AS PREVAILED AT THE T IME OF APPROVAL AND COMMENCEMENT OF THE CONSTRUCTION OF THE PROJEC T WELL BEFORE 1.4.2005. BOMBAY BENCH OF THE TRIBUNAL IN THE CASE OF HIRANANDANI AKRUTI J.V (SUPRA) HAS DISCUSSED ALL THESE RELEVANT ASPECTS RAISED BY THE DEPARTMENT. IN THE CASE OF HIRANANDANI AKRUTI J.V V/S. DCIT, IT HAS BEEN HELD THAT THE LAW AS EXISTED WHEN THE A SSESSEE SUBMITTED ITS PROPOSAL AND PERMISSION FOR CARRYING OUT THE DEVELOPMENT WAS ACCORDED AND WHEN THE ASSESSEE COMM ENCED DEVELOPMENT IS TO BE APPLIED. IN THE PRESENT CAS ES, AS PER PAGE NOS. 17 AND 20 OF THE PAPER BOOK IN THE CASE OF OPE L SHELTER THE PROJECT WAS COMMENCED ON 23.2.2001 AND EVEN COMPLET ED ON 14.5.2004, SIMILARLY AS PER THE CONTENTS OF PAGE NO .2 OF THE ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 7 ASSESSMENT ORDER AND PAGE NO. 41 OF THE PAPER BOOK IN THE CASE OF D.S. KULKARNI AND ASSOCIATES, THE PROJECT WAS COMM ENCED ON 12.4.2001 AND COMPLETED IN THE MONTH OF NOVEMBER 20 03. THUS, THE ASSESSEES WERE SUPPOSED TO COMPLETE THE PROJECT S AS PER THE LAW AS EXISTED IN THE A.Y. 2001-02 IN THE CASE OF OPEL SHELTERS AND IN THE A.Y. 2002-03 IN THE CASE OF D.S. KULKARNI A ND ASSOCIATES. WE THUS FOLLOWING THE DECISION IN THE CASE OF HIRA NANDANI AKRUTI JV V/S. DCIT (SUPRA) HOLD THAT AMENDED PROVISIONS UNDE R SECTION 80 IB(10) W.E.F. 1.4.2005 ARE NOT APPLICABLE IN THE PR ESENT CASE, HENCE ASSESSEES ARE ELIGIBLE FOR THE CLAIMED DEDUCTION U/ S. 80 IB (10) OF THE ACT. WE ACCORDINGLY DIRECT THE A.O TO ALLOW TH E CLAIMED DEDUCTION TO THE ASSESSEES. HAVING GONE THROUGH THE SAID DECISION IN THE CASE O F OPEL SHELTERS PVT. LTD. AND D.S. KULKARNI & ASSOCIATES (SUPRA), WE FIND THAT AF TER DETAILED DISCUSSION ON THE ISSUE, THE TRIBUNAL HAS COME TO THE CONCLUSION THAT THE ONLY FEASIBLE COMPLIANCE IS REQUIRED TO BE MADE AS PER THE HARMONIOUS INTERPRE TATION OF THE SECTION 80IB(10) AS AMENDED IS TO COMPLETE SUCH PROJECTS (APPROVED B EFORE 1.4.2004) ON OR BEFORE 31 ST MARCH 2008. IN THE PRESENT CASE BEFORE US, THE UN -REBUTTED FACTS ARE THAT THE PROJECT WAS STARTED IN JANUARY 2002 AND WAS COMPLET ED WELL BEFORE 31 ST MARCH 2008. WE THUS FIND THAT THE DECISION OF THE PUNE B ENCH OF THE TRIBUNAL IN THE CASE OF OPEL SHELTERS PVT. LTD. AND D.S. KULKARNI & ASSO CIATES (SUPRA) FULLY COVERS THE ISSUE RAISED IN THE PRESENT CASE AS IN THE CASE OF THE PRESENT ASSESSEE BEFORE US, IN VIEW OF THE DECISION IN THE CASE OF OPEL SHELTERS P VT. LTD. AND D.S. KULKARNI & ASSOCIATES (SUPRA), THE PROJECT WAS STARTED MUCH EA RLIER (I.E. JANUARY 2002) THAN 1.4.2005, HENCE THE ASSESSEE WAS REQUIRED TO COMP LETE THE PLAN AS IT WAS APPROVED BY THE LOCAL AUTHORITY AND AS PER THE PRO VISIONS OF THE INCOME TAX ACT PREVAILING AT THE TIME OF APPROVAL AND COMMENCEMENT OF THE CONSTRUCTION OF THE PROJECT I.E. JANUARY 2002 WHICH IS WELL BEFORE 1.4. 2005. UNDISPUTEDLY, WHEN THE PROJECT OF THE ASSESSEE STARTED IN JANUARY 2002, TH ERE WAS NO SUCH RESTRICTION OF CONSTRUCTION OF COMMERCIAL AREA IN THE PROJECT UNDE R THE PROVISIONS OF SECTION 80IB ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 8 WHICH HAS BEEN INTRODUCED BY INSERTION OF THE CLAUS E (D) THERETO W.E.F. 1.4.2005, HENCE THE ASSESSEE CANNOT BE EXPECTED TO COMPLY W ITH THE RESTRICTION NOT PREVAILING AT THE TIME OF THE COMMENCEMENT OF THE P ROJECT AS THE SAME WAS BEYOND ITS CONTROL AND REACH. WE THUS DO NOT AGREE WITH THE LD. D.R. THAT DECISION OF THE TRIBUNAL IN THE CASE OF OPEL SHELTERS PVT. LTD. & D .S. KULKARNI & ASSOCIATES (SUPRA) IS NOT APPLICABLE TO THE CASE OF THE PRESENT ASSESS EE. FACTS OF THESE CASES MAY BE SLIGHTLY DIFFERENT FROM THE FACTS OF THE PRESENT AS SESSEE, BUT, THE RATIO LAID DOWN IN THAT DECISION IS VERY MUCH APPLICABLE TO THE CASE O F THE PRESENT ASSESSEE. WE THUS FOLLOWING THE DECISION OF PUNE BENCH OF THE TRIBUNA L IN THE CASE OF OPEL SHELTERS PVT. LTD. AND D.S. KULKARNI & ASSOCIATES (SUPRA), HOLD T HAT THE ASSESSEE IS VERY MUCH ENTITLED TO THE CLAIMED DEDUCTION U/S. 80 IB(10) OF THE ACT AS THE AMENDED PROVISIONS U/S. 80IB (10) (D) ARE NOT APPLICABLE IN THE CASE OF THE PRESENT ASSESSEE AS THE PROJECT WAS APPROVED AND COMMENCED WELL BEFO RE 1.4.2005. WE ACCORDINGLY DIRECT THE A.O TO ALLOW THE CLAIMED DED UCTION TO THE ASSESSEE. THE ISSUE IS THUS DECIDED IN FAVOUR OF THE ASSESSEE. G ROUND NOS. 1 AND 2 ARE THUS ALLOWED IN FAVOUR OF THE ASSESSEE. GROUND NO.3 6. IT IS AN ALTERNATIVE PLEA OF THE ASSESSEE FOR RE LEVANT DEDUCTION U/S. 80IB(10) IN RESPECT OF THE PROFITS FROM THE RESIDENTIAL PORT ION OF THE PROJECTS. SINCE WE HAVE ALREADY ALLOWED THE APPEAL ON ITS MAIN GROUNDS TH E ALTERNATIVE PLEA RAISED IN GROUND NO. 3 OF THE APPEAL DOES NOT STAND. IT IS D ISPOSED OF ACCORDINGLY. 7. IN RESULT, THE APPEAL IS ALLOWED. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 30 TH NOVEMBER 2011. SD/- SD/- ( G.S. PANNU ) ACCOUNTANT MEMBER (I.C. SUDHIR ) JUDICIAL MEMBER PUNE, DATED THE 30TH NOVEMBER, 2011 ITA . NO 1369/PN/2009 SUDHIR MANDKE FAMILY (HUF) A.Y. 2005-06 PAGE OF 9 9 US COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT -II, PUNE 4. THE CIT(A)-II, PUNE 4. THE D.R. A BENCH, PUNE 5. GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL PUNE