M/s. Shree Mukund & Shreyas Developers, Pune V. Income-tax Officer,

ITA 1672/PUN/2014

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 9913 (ITAT-PUNE)
• Duration Of Justice: 4 year(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-09-2018
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 17-09-2018
• Assessment Year: 2009-2010
• Appeal Filed On: 05-09-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: S K JADHAV
• Keywords: Opportunity of being heard; Principle of natural justice
• Section: 80IB; 131

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUN E . , , ! , ' # BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI VIKAS AW ASTHY, JM . / ITA NO.1672/PUN/2014 '% & '& / ASSESSMENT YEAR : 2009-10 M/S. SHREE MUKUND & SHREYAS DEVELOPERS. 5, SHRIRAM APARTMENTS, 1126/A, NEAR HOTEL AMBASSADOR, MODEL COLONY, SHIVAJI NAGAR, PUNE-411 016. PAN : AABAS0344K .... / APPELLANT (% / V/S. THE INCOME TAX OFFICER, WARD-3(1), PUNE. / RESPONDENT ASSESSEE BY : SHRI PRATEEK JHA & SHRI PRAYAG JHA REVENUE BY : SHRI S.K. JADHAV / DATE OF HEARING : 17.09.2018 / DATE OF PRONOUNCEMENT : 26.09.2018 ) / ORDER PER D. KARUNAKARA RAO, AM : THIS IS THE APPEAL FILED BY ASSESSEE AGAINST THE ORDER OF CIT(APPEALS)-II, PUNE, DATED 30.04.2014 FOR THE ASSESSMENT YEAR 2009- 10. 2. THE GROUNDS RAISED BY THE ASSESSEE READ AS UNDER: 2 ITA NO. 1672/PUN/2014 A.Y.2009-10 ON FACTS AND IN LAW, 1. THE LEARNED CIT(A) ERRED IN CONFIRMING THE DISAL LOWANCE OF CLAIM OF DEDUCTION U/S.80IB(10) AMOUNTING TO RS.2,57,22,927/ - ON THE GROUND THAT THE ASSESSEE HAD NOT RECEIVED THE COMPL ETION CERTIFICATE OF THE ENTIRE PROJECT BY 31.03.2008. 2. THE LEARNED CIT(A) ERRED IN HOLDING THAT THE ASS ESSEE WAS NOT ENTITLED TO CLAIM DEDUCTION U/S. 80IB(10) SINCE IT HAD FAILED TO FULFILL THE CONDITION OF COMPLETION OF THE PROJECT WITHIN T HE STIPULATED TIME PERIOD. 3. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT THE ASSESSEE HAD COMPLETED THE SAID HOUSING PROJECT WITHIN THE SPECI FIED TIME LIMIT AND HENCE, THERE WAS NO REASON TO DISALLOW THE CLAIM OF DEDUCTION U/S 80IB(10). 4 . THE LEARNED CIT(A) ERRED IN NOT APPRECIATING THAT THE ASSESSEE HAD MADE AN APPLICATION FOR OBTAINING THE COMPLETION CE RTIFICATE BEFORE 31.03.2008 WHICH CLEARLY INDICATED THAT THE ASSESSE E HAD COMPLETED THE ENTIRE PROJECT AND HENCE, SIMPLY BECAUSE THE PU NE MUNICIPAL CORPORATION HAD ISSUED THE COMPLETION CERTIFICATE O N 01.08.2008 DOES' NOT MEAN THAT THE ASSESSEE HAD NOT COMPLETED THE PROJECT BEFORE 31.03.2008. 5. THE LEARNED CIT(A) FAILED TO APPRECIATE THAT SIN CE THE HOUSING PROJECT WAS STARTED PRIOR TO 01.04.2005, THE ASSESS EE WAS NOT REQUIRED TO SATISFY THE CONDITION OF COMPLETION OF THE PROJECT WITHIN THE SPECIFIED TIME LIMIT AND THEREFORE, THERE WAS NO REASON TO DENY THE DEDUCTION CLAIMED BY THE ASSESSEE. 6. THE ASSESSEE SUBMITS THAT THE DEDUCTION U/S.80IB (10) HAS BEEN WRONGLY DISALLOWED BY THE A.O. ON THE GROUND THAT T HE COMMERCIAL AREA IN THE SAID HOUSING PROJECT EXCEEDED 2000 SQ. FT. WITHOUT APPRECIATING THAT THE PROJECT OF THE ASSESSEE WAS S TARTED PRIOR TO 01.04.2005 AND HENCE, THERE WAS NO RESTRICTION ON T HE COMMERCIAL AREA INCLUDED IN THE PROJECT. 7. THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR DELETE ANY OF THE ABOVE GROUNDS OF APPEAL. 3. BRIEFLY STATED RELEVANT FACTS INCLUDE THAT THE ASSESSE E IS ENGAGED IN THE BUSINESS OF DEVELOPING HOUSING PROJECT LIKE EARLIER YEAR S. ASSESSEE FILED RETURN OF INCOME ON 23.10.2009 DECLARING TOTAL INCOME AT NIL. AT THE END OF THE ASSESSMENT, THE ASSESSING OFFICER QUANTIFIED THE ASSESSED INCOME AT RS.2,57,22,930/-(ROUNDED OFF). IN THE ASSESSMENT, TH E ASSESSING OFFICER MADE ADDITION OF RS.2,57,22,927/- AS PER DIS CUSSION GIVEN IN PARA 3 OF THE ASSESSMENT ORDER. THIS ADDITION AR ISES FROM THE CLAIM OF DEDUCTION U/S.80IB (10) OF THE INCOME TAX ACT, 1961 (HEREINAFTER 3 ITA NO. 1672/PUN/2014 A.Y.2009-10 REFERRED TO AS THE ACT). AS PER THE ASSESSING OFFICER, AS SESSEE FAILED TO FURNISH THE COMPLETION CERTIFICATE FROM PUNE MUNICIPAL CORPORATION (PMC), PUNE TO EVIDENCE THE COMPLETION OF THE PROJECT BY 31 ST MARCH, 2008. THE COMPLETION CERTIFICATE DATED 01.08.2008 FILED BY THE ASSESSEE IS CONSEQUENT TO THE APPLICATION DATED 16.07.2008 FOR ISSUA NCE OF COMPLETION CERTIFICATE BY THE SAID AUTHORITY. IN FACT, THE ASSESSING OFFICER GOT THE SAID CERTIFICATE/INFORMATION FROM AUTHORITY OF P MC (DEPUTY ENGINEER, PMC) VIDE LETTER NO. ZN/1/J/1694 DATED 15.11.2011 . ASSESSEE ALLEGED THAT THE ASSESSING OFFICER DID NOT GRANT PROPER OP PORTUNITY TO CROSS EXAMINE THE SAID DEPUTY ENGINEER, PMC ON THE GROU ND OF PAUCITY OF TIME. THE REQUEST OF THE ASSESSEE TO CROSS EXAMINE THE DEPUTY ENGINEER, PMC WAS NOT CONSIDERED BY THE ASSESSING OFFICER AS THERE WAS NO DEPOSITION OF ANY STATEMENT ON OATH FROM HIM. 4. AGGRIEVED WITH THE ORDER OF ASSESSING OFFICER, ASSESSEE FILED APPEAL BEFORE THE CIT(A). DURING FIRST APPELLATE PROCEEDINGS, ASSESS EE RAISED THE SAID ISSUE I.E. GRANTING REASONABLE OPPORTUNITY TO CROSS EXAMINE THE DEPUTY ENGINEER, PMC ALONG WITH ANOTHER ISSUE RELATING TO EXTENT OF COMMERCIAL AREA OF THE PROJECT . AS PER THE ASSESSEE, THE COMMERCIAL AREA OF 2564.20 SQ.FT SHOULD HAVE BEEN EXCEEDED AS THER E IS NO RESTRICTION PROVIDED BY THE STATUTE FOR THE YEAR UNDER CONSIDERATIO N. ASSESSEE PLACED RELIANCE ON THE COMPLETION CERTIFICATE DATED 01.08.2008 AN D DECISION OF TRIBUNAL IN THE CASE OF SATISH BORA VS. ACIT, ITA NO.713 & 714/PN/2010 FOR A.Y.2004-05 AND A.Y.2005-06 DECIDED ON 07.01.2011. THE CIT(A) EXAMINED THE SAID ISSUE AND ALSO EXAMINED THE ADDITIONAL EV IDENCES FURNISHED BY ASSESSEE BEFORE HIM. THE ISSUE OF REQUEST FOR CROSS EXAMINING THE DEPUTY ENGINEER, PMC WAS FORWARDED AND CALLE D FOR REMAND REPORT (PARA 3.1.2). THE CIT(A) CONSIDERED THE WRITT EN SUBMISSION 4 ITA NO. 1672/PUN/2014 A.Y.2009-10 MADE BY THE ASSESSEE (PARA 3.2) AND DISCUSSED THE ISSUE RELATING TO ALLOWABILITY OF CLAIM OF DEDUCTION U/S. 80IB (10) OF THE ACT ( PAR A 3.3) AND DISMISSED THE APPEAL OF THE ASSESSEE. THE CIT(A) RECORDED THAT THE HOUSING PROJECT OF THE ASSESSEE, IN QUESTION, WAS APPROVE D BY LOCAL AUTHORITY BEFORE 01.04.2004 AND THE RELEVANT DUE DATE FOR COMPLETION OF THE SAME IS ON 31.03.2008. THAT BEING THE LAW, THE DATE OF COMPLETION CERTIFICATE IS 01.08.2008 IN CONSEQUENT TO THE APPLICATION D ATED 16.07.2008 IS NOT IN FAVOUR OF THE ASSESSEE. THE CIT(A) DISM ISSED THE ADDITIONAL GROUNDS IN VIEW OF NON-SUBMISSION OF ANY DETAILS. TH E CONTENTS OF PARA 3.4.3 ONWARDS ARE RELEVANT FOR THE ADJUDICATION OF THIS ISSUE. OPERATION PARA OF THE DECISION IS IN PARA 3.5 TO 3.8 AND FOR THE SAKE OF COMPLETENESS THE SAME ARE EXTRACTED AS UNDER: 3.5 THUS, THE ISSUE INVOLVES THE DATE OF COMPLETIO N OF THE PROJECT FOR WHICH SECTION 80IB(10)(A) HAS PRESCRIBED THE TIME L IMIT UPTO 31.03.2008 WHEN THE HOUSING PROJECT HAS BEEN APPROV ED ON THE DATE ON WHICH THE BUILDING PLAN OF SUCH HOUSING PROJECT IS FIRST APPROVED BY THE LOCAL AUTHORITY. (I) IN A CASE WHERE THE APPROVAL IN RESPECT OF THE HOUSING PROJECT IS OBTAINED MORE THAN ONCE, SUCH HOUSING PR OJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON THE DATE ON WHIC H THE BUILDING PLAN OF SUCH HOUSING PROJECT IS FIRST APPR OVED BY THE LOCAL AUTHORITY; (II) THE DATE OF COMPLETION OF CONSTRUCTION OF THE HOUSING PROJECT SHALL BE TAKEN TO BE THE DATE ON WHICH THE COMPLETI ON CERTIFICATE IN RESPECT OF SUCH HOUSING PROJECT IS I SSUED BY THE LOCAL AUTHORITY:' IT IS THUS PROVIDED THAT IN A CASE WHERE THE APPROV AL IN RESPECT OF THE HOUSING PROJECT IS OBTAINED MORE THAN ONCE, THE HOU SING PROJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON THE DATE ON WHIC H THE BUILDING PLAN OF SUCH HOUSING PROJECT IS FIRST APPROVED BY T HE LOCAL AUTHORITY. THEREFORE, THE COMPLETION/OCCUPANCY CERTIFICATE IN RESPECT OF A HOUSING PROJECT HAS TO BE ISSUED BY THE LOCAL AUTHO RITY ONLY AS ENVISAGED BY THE PROVISION OF SECTION 80IB(10) OF T HE IT ACT, 1961. 3.6. DEVELOPMENT OF EVERY REGION IS REGULATED THE C ONCERNED LOCAL AUTHORITY IN ACCORDANCE WITH DC RULES/REGULATIONS F RAMED BY THAT LOCAL AUTHORITY. THE DC RULES/REGULATIONS ARE FRAME D BY THE LOCAL AUTHORITY DEPENDING UPON THE NEEDS OF THAT REGION A ND HENCE DIFFER FROM REGION TO REGION. THE EXPRESSION HOUSING PROJ ECT IS NEITHER DEFINED UNDER THE IT ACT NOR IT IS DEFINED UNDER TH E DC RULES/REGULATIONS FRAMED BY THE LOCAL AUTHORITY AND , THEREFORE, WHICH PROJECT WOULD QUALIFY TO BE CALLED AS A HOUSING PRO JECT HAS TO BE GATHERED FROM THE RULES/REGULATIONS FRAMED BY THE L OCAL AUTHORITY 5 ITA NO. 1672/PUN/2014 A.Y.2009-10 AND THE DEVELOPMENT OF PROJECT AT PUNE ARE APPROVED AS PER THE DEVELOPMENT CONTROL RULES FOR PUNE MUNICIPAL CORPOR ATION, PUNE 1982 DC RULES PUNE FOR SHORT. THUS THE LEGISLATUR E AND THE COURTS IN ITS WISDOM HAVE RECOGNIZED THE IMPORTANCE OF A LOCAL AUTHORITY AND RECOGNIZES THE CERTIFICATE ISSUED WITH RESPECT TO THE APPROVAL AS WELL AS COMPLETION/OCCUPANCY OF A HOUSING PROJECT. ONCE IT IS HOLD THAT THE LOCAL AUTHORITY COULD APPROVE A PROJECT TO BE A HOUSING PROJECT AND GRANT COMPLETION/OCCUPANCY CERTIFICATE AS PERMITTED UNDER THE DC RULES, THEN THE SAID PROJECT WOULD BE ELIGIBLE FOR SECTION 80IB(10) DEDUCTION IRRESPECTIVE OF THE FACT THAT SO ME INFIRMITY, IF NOTICED SUBSEQUENTLY CANNOT COMPLETELY OVERLOOK THE GRANT OF THE CERTIFICATE ISSUED BY THE LOCAL AUTHORITY. IN THE P RESENT CASE THE ISSUE IS THAT OF THE TIME LIMIT BY WHICH THE PROJECT SHOU LD HAD BEEN COMPLETED IN ORDER TO QUALIFY FOR DEDUCTION U/S.80I B(10) OF THE IT ACT, 1961, THE APPELLANT HAD NOT FULFILLED THE CONDITION REGARDING OBTAINING THE OCCUPANCY CERTIFICATE FROM THE LOCAL AUTHORITY BUT HAS FAILED TO OBTAIN THE SAME WITHIN THE TIME LIMIT PRES CRIBED IN THE AFORESAID SECTION OF THE ACT FOR CLAIMING DEDUCTION I.E. BEFORE 31.03.2008. 3.7. SINCE THE APPLICATION ITSELF HAS BEEN MADE BY THE APPELLANT BEYOND THE STIPULATED TIME, THEREFORE, THE CONTENTI ON RAISED IS NOT AT ALL APPLICABLE VIS--VIS THE DEDUCTION CLAIMED U/S. 80IB(10) OF THE IT ACT. IN THE CASE OF THE APPELLANT AS THE APPLICATIO N FOR OCCUPANCY CERTIFICATE FOR BUILDING B, AS PER MATERIAL ON RE CORD HAS BEEN MADE ON 16.07.2008 TO THE PMC AND THE OCCUPANCY CERTIFIC ATE HAS BEEN ISSUED SUBSEQUENTLY I.E. ONLY ON 01.08.2008 WHICH I S MUCH BEYOND THE DATE STIPULATED AS PER SECTION 80IB(10) OF THE IT ACT, THEREBY THE APPELLANT HAS NOT FULFILLED THE CONDITIONS AS PER S ECTION 80IB(10)(A) R.W. EXPLANATION. 3.8. IN VIEW OF THE ABOVE FACTS THE CLAIM OF DEDUCT ION U/S.80IB(10) OF THE IT ACT, 1961 FOR THE ASSESSMENT YEAR UNDER CONS IDERATION HAS RIGHTLY BEEN DISALLOWED BY THE AO AS THE PROJECT HA S NOT BEEN COMPLETED WITHIN THE TIME FRAME STIPULATED U/S.80IB (10)(A) OF THE IT ACT. ACCORDINGLY, GROUNDS NO. 1 TO 4 RAISED BY THE APPELLANT ARE DISMISSED. 5. AGGRIEVED WITH THE ORDER OF CIT(A), THE ASSESSEE IS IN A PPEAL BEFORE US BY RAISING GROUNDS AS EXTRACTED ABOVE. 6. BEFORE US, LD. COUNSEL FOR THE ASSESSEE RAISED SEVEN G ROUNDS OUT OF WHICH GROUND NOS.1 TO 5 RELATES TO THE COMPLETION CERT IFICATE LINKED ARGUMENTS. THE GROUND NO. 6 RELATES TO THE EXTENT OF CO MMERCIAL AREA AS APPLICABLE TO THE ASSESSEES PROJECT. IT ALSO RELATES TO THE APPLICABILITY OF THE RELEVANT CONDITION ON EXTENT OF 2000 SQ. FT. OF COMMERC IAL AREA OF THE SAID PROJECT UNDER CONSIDERATION. IT IS CLAIM OF THE ASSES SEE THAT SUCH RESTRICTION DOES NOT APPLY TO THE ASSESSEES PROJECT WHICH WAS APPROVED 6 ITA NO. 1672/PUN/2014 A.Y.2009-10 PRIOR TO 01.04.2005. LD. COUNSEL FOR THE ASSESSEE NARRAT ED THE FACTS OF THE ISSUES AND SUBMITTED THAT THE ASSESSING OFFICER ERRED IN NOT CONSIDERING THE FIRST APPLICATION DATED 11.03.2008 (PAGE 5 OF THE PAPER BOOK) MADE TO PMC FOR REQUESTING GRANT OF OCCUPA NCY CERTIFICATE. ASSESSEE CLAIMS THE COMPLETION CERTIFICATE DATED 01.08.2008 WAS GIVEN IN RESPONSE TO THE SECOND APPLICATION DATED 16.07.2008. IN FA CT, ASSESSEE MADE APPLICATION FIRST ON 11.03.2008 AND THE PROJECT WAS COMPLETED PRIOR TO THIS DATE. FURTHER, THE ASSESSING OFFICER HAS NOT GRANT ED ANY OPPORTUNITY TO CROSS EXAMINE THE DEPUTY ENGINEER OF PMC WHO ISSUED COMPLETION CERTIFICATE DATED 01.08.2008 (PAGE 46 OF THE PAP ER BOOK). FURTHER, LD. COUNSEL NARRATED FOLLOWING EVENTS GIVING IMPORTANT DATE S: SR. NO. DATE DESCRIPTION 1 30/04/2002 COMMENCEMENT CERTIFICATE GRANTED 2. 14/08/2003 COMMENCEMENT CERTIFICATE GRANTED AFTER REVISION OF PLAN 3. 29/10/2004 COMMENCEMENT CERTIFICATE GRANTED AFTER REVISION OF PLAN 4. 15/03/2005 COMMENCEMENT CERTIFICATE GRANTED AFTER REVISION OF PLAN 5. 07/07/2005 PART OCCUPANCY CERTIFICATE GRANTED FOR TOWER A. DEDUCTION CLAIMED U/S.80IB(10) OF RS.1,00,82,771/- IN A.Y 2006-07. DEDUCTION ALLOWED. 6. 11/03/2008 APPLICATION MADE TO PMC FOR OCCUPANCY CERTIFICATE AFTER COMPLETION OF TOWER B ALONG WITH COPIES OF A) DRAINAGE NOC B) WATER METER NOC C) ENCROACHMENT NOC D) LICENSE TO OPERATE LIFT E) TAX NOC F) FIRE NOC G) GARDEN NOC 7. 31/03/2008 LAST DATE FOR COMPLETING CONSTRUCTION TO CLAIM DEDUCTION U/S.80IB(10). 8. 17/07/2008 SECOND APPLICATION MADE TO PMC FOR GRANT OF OCCUPANCY CERTIFICATE ALONG ALL 7 ITA NO. 1672/PUN/2014 A.Y.2009-10 6.1 FURTHER, LD. COUNSEL BROUGHT OUR ATTENTION TO THE GR OUNDS OF THE APPEAL BEFORE CIT(A) AND SUBMITTED CIT(A)S FAILURE TO ADJU DICATE THE ISSUE RAISED IN GROUND NO. 6 OF THE PRESENT APPEAL. HE FURT HER SUBMITTED THAT CIT(A) FAILED TO APPRECIATE THE FACT THAT THE AMENDME NT BROUGHT IN BY THE FINANCE (NO.2) ACT, 2004, DOES NOT APPLY AS THE PROJ ECTS APPROVED PRIOR TO THE SAID DATE. THE PROJECT WAS FIRST APPROVED IN THIS CASE ORIGINALLY IN APRIL, 2002. IN THE INSTANT CASE, THE PROJECT W AS UNDISPUTEDLY APPROVED BY THE PMC PRIOR TO THE AMENDMENT TO SECTION 80IB(10) OF THE ACT. FURTHER, IN THIS REGARD, LD. COUNSEL RELIED ON THE DECIS ION OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. BRAHMA ASSOCIATES, 197 TAXMAN 459 ( BOMBAY) IN 2011 . IGNORING ALL THESE IMPORTANT ASPECTS I.E. DEVELOPMENTS OF THE PROJECTS, ARGUMENTS ADVANCED BY TH E LD. COUNSEL AND JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT, THE CIT( A) CONFIRMED THE DISALLOWANCE WHICH IS UNSUSTAINABLE IN THE EYE OF LAW. LD. COUNSEL PRAYED FOR REMITTING THE ISSUE BACK TO THE FILE OF ASSESSING OFFICER FOR REMOVING DISCREPANCIES OCCURRED IN THE ASSESSMENT PROCE EDINGS AND ADJUDICATING THE ISSUE AFRESH. 7. ON THE OTHER HAND, LD. DR FOR THE REVENUE HEAVILY R ELIED ON THE ORDERS OF ASSESSING OFFICER AND CIT(A). TO START WITH, LD. DR SUBMITTED THAT COMPLETION CERTIFICATE NO.1 IS NOT BONA-FIDE ONE. BRIN GING OUR ATTENTION TO PAGE 5 OF THE PAPER BOOK, LD. DR SUBMITTED THAT THE COMPLETION CERTIFICATE NO. 1 HAS NOT BEEN ACKNOWLEDGED BY THE MUNICIPAL AUTHORITY AND THE SAME IS EVIDENT FROM THE FACT THAT SEA L AND STAMP OF THE PMC IS MISSING. THE CONTENTS AVAILABLE ON APPLICATION FOR OCCU PANCY THE ATTACHMENTS. 9. 01/08/2008 PMC GRANTS OCCUPANCY CERTIFICATE. 8 ITA NO. 1672/PUN/2014 A.Y.2009-10 CERTIFICATE NO. 2, ARE PLACED AT PAGE 46 OF THE PAPER BOOK . EXPLAINING THE MANNER OF SUCH APPLICATION, LD. DR SUBMITTED THAT THERE IS A PROCEDURE OF ENTRY FOR SUBMITTING SUCH APPLICATION IN TALUKA REGISTER O F THE CONCERNED DEPARTMENT AND NO SUCH ACKNOWLEDGEMENT WAS EVIDENT ON APPLICATION FOR COMPLETION CERTIFICATE NO.1 FILED BY THE ASSE SSEE. FURTHER, BRINGING OUR ATTENTION TO THE SIGNATURE OF ARCHITECTURE, S TRUCTURAL ENGINEER, ENGINEER ETC, LD. DR SUBMITTED THAT SIGNATURE OF ARCHITECTURE DO NOT TALLY. LICENSE/REGISTRATION NUMBER OF THE SIGNATOR Y IS ALSO EXCLUSIVELY ABSENT ON PAGE 5 I.E. COPY OF APPLICATION SUBMIT TED ON 11.03.2008 FOR GRANT OF OCCUPANCY CERTIFICATE. FURTHER, LD . DR ARGUED TO MAKE OUT HIS CASE THAT APPLICATION FOR OCCUPANCY CERTIFICAT E NO.1 IS NEVER SUBMITTED TO THE PMC. HE FURTHER SUBMITTED THAT DEPUTY ENGINEER, PMC RELYING ON HIS RECORDS COMMENTED THAT OCCUPANCY CERT IFICATE NO. 2 IS THE FINAL OCCUPANCY CERTIFICATE WHICH IS RELEVANT FOR DECIDING THE ALLOWABILITY OF CLAIM OF DEDUCTION U/S.80IB(10) OF THE ACT. REFERRING TO AS SESSEES REQUEST FOR CROSS EXAMINING THE DEPUTY ENGINEER, LD. DR S UBMITTED THAT DEPUTY ENGINEER HAS NOT GIVEN ANY STATEMENT AGAINST TH E ASSESSEE AND ACCORDINGLY, THERE IS NO NEED TO CROSS EXAMINE THE DEPU TY ENGINEER BY THE ASSESSEE. THUS, LD. DR SUBMITTED THAT AO/CIT(A) HAS R IGHTLY ADJUDICATED THE ISSUE WITHOUT GRANTING OPPORTUNITY TO CROSS EXA MINE. 7.1 ON THE ISSUE OF APPLICABILITY OF THE JUDGEMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. BRAHMA ASS OCIATES (SUPRA.), LD. DR HEAVILY PLACED RELIANCE ON THE ORDERS OF AO/ CIT(A). ON THE ASSESSEES REQUEST FOR REMITTING THE ISSUE BACK TO THE FILE OF AO, LD. DR SUBMITTED THAT IT IS CLEAR CASE OF NON COMPLETION OF HOU SING PROJECT BEFORE DUE DATE AND THEREFORE, DENIAL OF DEDUCTION U/S.80IB (10) BY THE ASSESSING OFFICER/ CIT(A) IS JUSTIFIED. 9 ITA NO. 1672/PUN/2014 A.Y.2009-10 8. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE RECO RD. THE ISSUES RAISED BEFORE US RELATES TO (I) COMPLETION CERTIFICATE & PROVIDING OPPORTUNITY TO CROSS EXAMINE THE DEPUTY ENGINEER, P MC AND (II) EXTENT OF COMMERCIAL AREA OF THE HOUSING PROJECT . WE SHALL DEAL WITH THESE ISSUES IN THE FOLLOWING PARAGRAPHS: COMPLETION CERTIFICATE & PROVIDING OPPORTUNITY TO C ROSS EXAMINE THE DEPUTY ENGINEER, PMC : 9. COMPLETION CERTIFICATE (CC) : UNDISPUTED FACTS RELATING TO THIS ISSUE OF CC ARE THAT TH E PROJECT WAS APPROVED PRIOR TO 01.04.2004 (CLAUSE-1 (I) OF SECTION 80I B(10)(A) OF THE ACT) AND DUE DATE OF COMPLETION OF THE HOUSING PROJEC T IS 31 ST MARCH, 2008. THE ASSESSEE CLAIMS MAKING OF AN APPLICATION FOR COMPLE TION CERTIFICATE FIRST (PAGE 5 OF THE PAPER BOOK) ON 11.03.2008 FO R COMPLETION OF TOWER-B WITH ALL NECESSARY ANNEXURES. RELYING ON THE SAM E, ASSESSEE CONSIDERED THE SAME AS COMPLIANCE TO MEET THE PROVISIONS OF INCOME TAX PROVISIONS. FURTHER, THE ASSESSEE SUBMITTED THAT THE SEC OND APPLICATION DATED 17.07.2008 ALONG WITH ALL THE ATTACHMENTS WAS FILED A S THERE WAS NO RESPONSE FROM THE PMC. IT IS NOT KNOWN TO US AS TO WHY THE ASSESSEE FILED THE SAID SECOND APPLICATION TO THE PMC FOR WANT OF COM PLETION CERTIFICATE ON 17.07.2008 WHEN HE HAS ALREADY FILED FIRST APPLIC ATION ON 11.03.2008. THE ONUS IS UPON THE ASSESSEE TO EXPLAIN TH E REASONS FOR MAKING SECOND APPLICATION. AS SUCH NO COMPLIANCE RECEIPTS WAS FILED BY THE LD. COUNSEL BEFORE THE ASSESSING OFFICER OR BEFORE US T O SUBSTANTIATE ITS CASE. 10 ITA NO. 1672/PUN/2014 A.Y.2009-10 10. WE HAVE EXAMINED BOTH THE APPLICATIONS I.E. FIRST APPLICA TION DATED 11.03.2008 AND SECOND APPLICATION DATED 17.07.2008 AND FOUN D, THE FIRST APPLICATION SUFFERS FROM VARIOUS DISCREPANCIES, QUESTIONIN G THE CREDIBILITY OF THE FIRST APPLICATION FOR ISSUANCE OF CC BY THE PMC. SIGNATORIES OF THE APPLICATIONS ARE DIFFERENT AND MANNER OF T AKING ACKNOWLEDGEMENT FROM PMC AUTHORITY ARE ALSO DIFFERENT. THES E DISCREPANCIES AND DIFFERENCES HAVE LEFT MANY QUESTIONS REGA RDING BONA FIDE OF THE FIRST APPLICATION (PAGE 5 OF THE PAPER BOOK). WHE N THERE ARE SUCH UNANSWERED QUESTIONS WITH RESPECT TO THE APPLICATIO N FORM LOGICALLY, INCOME TAX AUTHORITY SHOULD HAVE EXAMINED THE A TTACHMENTS TO THE SAID APPLICATIONS AND SEE IF THESE DOCUMENTS ARE AUTH ENTIC AND COMPLETE IN ALL RESPECT QUA THE DUE DATE OF COMPLETION OF T HE HOUSING PROJECT. ASSESSING OFFICER DID NOT VERIFY THE SAME. ASSESS ING OFFICER SHOULD HAVE MADE ENQUIRIES WITH THE DRAINAGE DEPARTMENT, WATER METER, ENCROACHMENT DEPARTMENT, LICENSE TO OPERATE LIFT, TAX, FIRE AND GARDEN ETC TO ASCERTAIN THE COMPLETION OF THE PROJECT. NO ATTEM PT WAS MADE IN THIS REGARD BY THE ASSESSING OFFICER. THEREFORE, IN OUR VIEW , THERE IS NEED FOR SCRUTINY OF THESE FACTS BY THE ASSESSING OFFICER. HENCE, THESE ASPECTS ARE FOUND NEEDED FOR REMANDING TO THE FILE OF ASSESSING OFFIC ER. ASSESSING OFFICER SHALL GRANT REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE AS PER THE SET PRINCIPLES OF NATURAL JUSTICE. 11. PROVIDING OPPORTUNITY TO CROSS EXAMINE THE DEPUTY ENGINEER PM C : COMING TO THE NEXT ISSUE I.E. REQUEST OF ASSESSEE TO CRO SS EXAMINE THE DEPUTY ENGINEER, PMC, WE FIND, IT IS A SETTLED LEGAL PROPOS ITION IF THERE IS ANY INCRIMINATING STATEMENT GIVEN BY WITNESS TO THE DEP ARTMENT AGAINST THE ASSESSEE THEN PRINCIPLES OF NATURAL JUSTICE D EMAND THAT AN OPPORTUNITY SHOULD NECESSARILY BE GIVEN TO THE AFFECTED P ARTY I.E. ASSESSEE 11 ITA NO. 1672/PUN/2014 A.Y.2009-10 IN THIS REGARD. AS SUCH, IN A CASE WHERE NO SUCH STATEM ENT IS GIVEN AND MERELY A COMPLETION CERTIFICATE WAS ISSUED BY THE DEPUTY ENGINEER IN NORMAL COURSE OF HIS DUTIES AS GOVT. SERVANT, IN OUR VIEW , IT DOES NOT CALL FOR ANY CROSS EXAMINATION TO THE SAID DEPUTY ENGINEER, PM C WHO ISSUED SUCH COMPLETION CERTIFICATE. THIS CROSS EXAMINATION WILL COME IN TO PICTURE WHEN THE ASSESSING OFFICER INVOKED THE PROVISIONS OF SECTION 131 OF THE ACT AND RECORDED STATEMENT AND THE SAME IS AGAINST TH E ASSESSEE. IN ANY CASE, ASSESSING OFFICER IS DUTY BOUND TO SUPPLY COPIES OF T HE DOCUMENTS OBJECTED BEFORE HIM UNDER VARIOUS SECTIONS OF THE ACT AN D THEY ARE PUT TO USE AGAINST THE ASSESSEE IN THE ASSESSMENT. AS SUCH, TH E ASSESSEE HAS THE OTHER REMEDIES BEFORE THE SAID OFFICER/ ENGINEER UNDER RIGHT TO INFORMATION ACT & VARIOUS RULES. THEREFORE, WE ARE OF THE OPINION THAT THE ENGINEER MERELY EXECUTED HIS DUTIES AND THERE IS NO NEE D FOR CROSS EXAMINING HIM. WE ORDER ACCORDINGLY. 12. THUS, WHILE DECIDING THIS ISSUE BASED ON INFORMATION AVAILA BLE WITH US, WE ARE OF THE CONSIDERED OPINION, AS REQUESTED BY TH E LD. COUNSEL FOR THE ASSESSEE, THIS ISSUE NEEDS TO BE REMANDED TO THE FILE OF ASSESSING OFFICER FOR FRESH ADJUDICATION OF ALL THE ASPECTS OF THE COMPLE TION CERTIFICATE. ASSESSING OFFICER SHALL GRANT REASONABLE OPPORTU NITY OF BEING HEARD TO THE ASSESSEE. 13. ACCORDINGLY, RELEVANT GROUNDS/ARGUMENTS RAISED BY ASSESSEE ARE PARTLY ALLOWED FOR STATISTICAL PURPOSES . EXTENT OF COMMERCIAL AREA 14. PROVISIONS OF CLAUSE (D) OF SECTION 80IB (10) IS RELEVANT FOR THE ISSUE OF BUILT UP AREA OF THE SHOPS AND OTHER COMMERCIAL ESTABLIS HMENTS 12 ITA NO. 1672/PUN/2014 A.Y.2009-10 INCLUDED IN THE HOUSING PROJECT. THESE PROVISIONS ARE BROU GHT INTO STATUTE BY THE FINANCE (NO.2) ACT, 2004 W.E.F. 01.04.2005. THE STATUTE PROVIDES FOR RESTRICTION OF 2000 SQ. FT. AS PER THE ASSESSEE, THIS RE STRICTION IS APPLICABLE TO THE HOUSING PROJECT APPROVED ON OR AFTER 0 1.04.2005 AND THE SAME IS NOT APPLICABLE IN THE CASE WHERE THE PROJECT STA NDS APPROVED BEFORE THE SAID DATE. ASSESSEE PLACED RELIANCE ON THE J UDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. BRAHMA ASSOCIATES (SUPRA.). 15. ON HEARING BOTH THE PARTIES ON THIS ISSUE, WE FIND, THIS ISSUE WAS NOT ADJUDICATED BY THE LOWER AUTHORITIES IN PROPER PERS PECTIVE BY GIVING SPEAKING ORDER AS REQUESTED BY THE LD. COUNSEL. ACCORDIN GLY, WE ARE OF THE CONSIDERED OPINION THAT THIS ISSUE SHOULD BE REMANDED TO THE FILE OF ASSESSING OFFICER FOR FRESH ADJUDICATION AFTER CONSIDERING THE JUDGMENT OF HON'BLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. BRA HMA ASSOCIATES (SUPRA.) AND AFTER GIVING REASONABLE OPPORTUNITY OF BEING HEARD TO THE ASSESSEE. ACCORDINGLY, THIS PART OF GROUND RAISED BY THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES . 16. IN THE RESULT, APPEAL OF THE ASSESSEE IS PARTLY ALLOWED FOR STATISTICAL PURPOSE. ORDER PRONOUNCED ON 26 TH DAY OF SEPTEMBER, 2018. SD/- SD/- ( ! /VIKAS AWASTHY) ( . / D. KARUNAKARA RAO ) / JUDICIAL MEMBER / ACCOUNTANT MEMBER / PUNE; !' / DATED : 26 TH SEPTEMBER, 2018. SB 13 ITA NO. 1672/PUN/2014 A.Y.2009-10 ) * +',- . ', / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. THE CIT(APPEALS)-II, PUNE. 4. THE CIT-II, PUNE. 5. %&' () , * () , +,- , / DR, ITAT, A BENCH, PUNE. 6. './ 01 / GUARD FILE. // TRUE COPY // * 2 / BY ORDER, 3 (- /PRIVATE SECRETARY * () , / ITAT, PUNE.