ITO WD 2(2), THANE V. RAMPRASAD AGARWAL, THANE

ITA 1773/MUM/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 3171 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-03-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 12-03-2015
• Assessment Year: 2009-2010
• Appeal Filed On: 05-03-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V IRAG H SHAH
• Assessee Lawyers: B S BIST
• Keywords: Wrong claim
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES D, MUMBAI BEFORE SHRI B.R.BASKARAN (AM) AND SHRI RAM LAL NEGI (JM) ITA NO 866/MUM/2013 ASSESSMENT YEAR: 2008-2009 SHRI. RAMPRASAD AGARWAL , GR. FLR., VRINDAVAN, SALASAR BRIJBHOOMI, TEMBA HOSPITAL ROAD, BHAYANDER(W), THANE- 401101. PAN: AAOPA2405P VS. THE CIT(APPEALS) - I, VARDAAN, 9 TH FLOOR, MIDC, WAGLE INDUSTRIAL ESTATE, THANE. (APPELLANT) (RESPONDENT) ITA NO 1108 & 1773/MUM/2013 ASSESSMENT YEAR: 2008-2009 & 2009-10 THE ITO WD. 2(2), ROOM NO. 26/B, ASHAR IT PARK, ROAD NO. 16Z, WAGLE ESTATE, THANE- 400604. VS. SHRI. RAMPRASAD AGARWAL, GR. FLR., VRINDAVAN, SALASAR BRIJBHOOMI, TEMBA HOSPITAL ROAD, BHAYANDER(W), THANE- 401101. PAN: AAOPA2405P (APPELLANT) (RESPONDENT) ITA NO 874/MUM/2013 ASSESSMENT YEAR: 2009-2010 SHRI. RAMPRASAD AGARWAL, GR. FLR., VRINDAVAN, SALASAR BRIJBHOOMI, TEMBA HOSPITAL ROAD, BHAYANDER(W), THANE- 401101. PAN: AAOPA2405P VS. THE CIT(APPEALS) - II, ROOM NO. 29, B-WING, 6 TH FLOOR, ASHAR IT PARK, ROAD NO. 16Z, WAGLE INDUSTRIAL ESTATE, THANE- 400604. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI. VIRAG H. SHAH RESPONDENT BY : SHRI. B.S. BIST. 2 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 DATE OF HEARING: 07/03/2016 DATE OF PRONOUNCEMENT: 31/03/2016 O R D E R PER RAM LAL NEGI, JM THE ASSESSEE HAS FILED ITA NO. 866/M/2013 FOR THE ASST. YEAR 2008-09 AGAINST ORDERS DT. 19/10/2012 PASSED BY THE LD. CIT (APPEALS)-I VARDAAN THANE, AND THE REVENUE HAS FILED CROSS APPEAL ITA NO. 1108/M/2013 AGAINST THE SAME ORDER. SIMILARLY THE ASSESSEE HAS FILED TH E ITA NO. 874/M/2013 FOR THE ASST. YEAR 2009-10 AGAINST THE ORDER DT. 30/11/ 2012 PASSED BY THE LD. CIT(A)-II, THANE AND THE REVENUE HAS FILLED CROSS A PPEAL ITA NO. 1173/M/2013 AGAINST THE SAME ORDER. SINCE ALL THE FOUR APPEALS PERTAIN TO THE ASSESSEE SHRI. RAMPRASAD AGARWAL, FOR ASST. YEAR 2008-09 & 2009-10 AND THE ISSUES INVOLVED ARE IDENTICAL, THE SAME WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. ITA 866/M/2013 FOR A.Y. 2008-09 2. THE ASSESSEE HAS CHALLENGED THE IMPUGNED ORDER O N THE FOLLOWING EFFECTIVE GROUNDS:- 1. THE HONBLE COMMISSIONER OF INCOME TAX(APPEALS) -I, THANE (CIT(A)) ERRED IN LAW AND IN FACTS BY PROPORTIONATELY DISALL OWING THE DEDUCTION U/S. 80IB(10), IN RESPECT OF RESIDENTIAL UNITS, WHO SE BUILT UP AREAS EXCEED THE PRESCRIBED LIMIT OF 1000SQUARE FEET AS C OMPUTED BY THE AMENDED PROVISIONS OF SEC. 80IB(14), DISREGARDING T HE FACT THAT- (I) THE AMENDED PROVISIONS OF SEC. 80IB(14) ARE TO BE APPLIED PROSPECTIVELY FOR PROJECTS APPROVED AFTER 01/04/200 5 AND NOT RETROSPECTIVELY, WHEREAS IN THE INSTANCE CASE THE HOUSING PROJECT HAS COMMENCED ON 28/05/2003. 3 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 (II) AS PER THE PRE-AMENDED PROVISIONS, THE MAXIMUM BUILT-UP AREA OF NONE OF THE RESIDENTIAL UNITS EXCEED THE PRESCRIBED LIMIT OF 1000SQUARE FEET AS COMPUTED AND CERTIFIED BY THE AR CHITECT 2. THE LD. CIT(A) FURTHER ERRED IN THIS CONNECTION BY NOT HONORING AND FOLLOWING THE ORDER OF THE HON ITAT, MUMBAI D BE NCH DATED 05/09/2012 IN THE APPELLANTS OWN CASE FOR A.Y. 200 6-07 WHEREIN THIS PARTICULAR ISSUE IS DECIDED IN FAVOR OF THE APPELLA NT. 3. ALTERNATIVELY, THE PROJECT BEING SITUATED AT BH AYANDAR(W), IT IS BEYOND 25 KILO METERS FROM THE MUNICIPAL LIMITS OF MUMBAI AND THUS AS PER PROVISIONS OF SEC.80IB(10)(C), THE MAXIMUM B UILT-UP AREA PER RESIDENTIAL UNIT CAN EXCEED 1000 SQUARE FEET UP TO A MAXIMUM OF 1500 SQUARE FEET. EVEN IF COMPUTED AS PER THE AMENDED SE C. 80IB(14), THE MAXIMUM BUILT-UP AREA OF NONE OF THE RESIDENTIAL U NITS OF THE PROJECT EXCEED THIS LIMIT OF 1500 SQUARE FEET. 3. BRIEF FACTS OF THE CASE ARE THAT THE APPELLANT/A SSESSEE ENGAGED IN BUILDING CONSTRUCTION ACTIVITIES FILED ITS RETURN OF INCOME FOR THE A.Y. 2008-09 DECLARING TOTAL INCOME OF RS. 6,47,129/-, AFTER CLAIMING DEDU CTION U/S 80IB(10) AMOUNTING TO RS. 2,55,10,143/-. THE CASE WAS SELECT ED FOR ASSESSMENT U/S 143(2). ACCORDINGLY THE DETAILS WERE CALLED FOR BY THE ASSESSING OFFICER AND IN RESPONSE THEREOF, THE ASSESSEE FILED THE RELEVANT D OCUMENTS ALONG WITH EXPLANATIONS IN ORDER TO JUSTIFY ITS CLAIM. THE A.O BEING NOT CONVINCED, PASSED ASSESSMENT ORDER DISALLOWING THE ENTIRE CLAIM OF DE DUCTION U/S 80IB(10) OF THE ACT. 4. AGGRIEVED BY THE ASSESSMENT ORDER, THE APPELLANT FILED AN APPEAL BEFORE THE FIRST APPELLATE AUTHORITY WHO IN TURN PASSED ORDER DT. 19/10/2012 PARTLY ALLOWING THE APPEAL OF THE ASSESSEE BY DIRECTING TH E A.O TO ALLOW THE DEDUCTION U/S 80IB (10) IN RESPECT OF FLATS, BUILT UP AREA OF WHICH DOES NOT EXCEED THE 4 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 PRESCRIBED LIMIT. THE ASSESSEE IS IN APPEAL BEFORE THIS TRIBUNAL AGAINST THE IMPUGNED ORDER PASSED BY THE LD. CIT(A). 5. THE CONTROVERSY CROPPED UP IN THIS CASE AFTER I NSERTION OF DEFINITION OF BUILT UP AREA UNDER SECTION 80IB(14), APPLICABLE W.E.F. 1/4/2005. THE CONTENTION OF THE ASSESSEE IS THAT THE NEW DEFINITION OF BUILT UP AREA IS NOT APPLICABLE TO HIS CASE SINCE THE PROJECT IN QUESTION WAS APPROVED PRI OR TO 1/4/2005. 6. THE LD. AR REITERATED THE STAND TAKEN BY THE ASS ESSEE BEFORE THE INCOME TAX AUTHORITIES AND FURTHER SUBMITTED THAT THE CASE OF THE ASSESSEE IS COVERED BY THE DECISION OF ITAT MUMBAI PASSED IN ASSESSEES OW N CASE FOR THE A.Y. 2006- 07 ITA 2435/M/2010. IN THE SAID CASE IDENTICAL ISSU E HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE. THEREFORE, THE FINDINGS OF THE LD. CIT(A) AND DIRECTION TO THE AO TO ALLOW THE CLAIM OF DEDUCTION U/S 80IB(10) ON PROPORTIONATE BASIS, EXCLUDING THE AREA OF FLAT/FLATS HAVING AREA MORE T HAN 1000SQ. FEET FOR THE YEAR UNDER CONSIDERATION AND ALLOW THE DEDUCTION U/S 80I B(10) ON ALL OTHER FLATS BELOW 1000SQ. FEET, IS ERRONEOUS. THE HONBLE SUPRE ME COURT IN CIT VS. SARKAR BUILDERS, (2015)375 ITR392,SC, HAS HELD THAT THE AMENDED PROVISIONS OF SECTION 80 IB (14) ARE TO BE APPLIED PROSPECTIVELY FOR PROJECTS APPROVED AFTER 01/ 04/2005 AND NOT RETROSPECTIVELY, WHEREAS IN THE INSTANT CASE THE HOUSING PROJECT HAS COMMENCED ON 28.5.2003. ON THE OTHER HA ND THE LEARNED DR SUBMITTED THAT ALLOWING DEDUCTION UNDER SECTION 80 IB (10) OF THE ACT ON THE PROPORTIONATE BASIS IN CASE WHERE THE AREA OF EACH RESIDENTIAL UNIT EXCEEDS 1000 SQ. FEET IS VIOLATION OF THE PROVISIONS OF THE ACT. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND ALSO PRO DUCED THE MATERIAL PLACED BEFORE US INCLUDING THE CASE LAW RELIED UPON BY BOT H THE PARTIES. THE SECOND 5 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 GROUND OF THE APPEAL IS CONNECTED TO THE FIRST GROU ND RAISED BY THE ASSESSEE. THE COORDINATE BENCH OF ITAT MUMBAI HAS DECIDED THE IDENTICAL ISSUE IN FAVOUR OF THE ASSESSEE IN APPEAL FILED BY THE REVENUE IN A SSESSEES OWN CASE ITA NO 2163/MUM/2010 FOR THE ASSESSMENT YEAR 2006-07, HOLD ING AS UNDER:- 9. IN THE CROSS APPEAL, THE ISSUE RAISED BY THE D EPARTMENT REVOLVES AROUND THE ALLOWANCE OF DEDUCTION U/S 80IB(10), BUT FROM A DIFFERENT ANGLE, I.E. SOME OF THE FLATS EXCEEDED 1000SQ. FT. THIS ISSUE HAS BEEN DEAL WITH BY THE CO-ORDINATE BENCH AT MUMBAI IN THE CASE OF SAROJ SALES ORGANISATION V/S ITO REPORTED IN 115 TTJ 485 (MUMBAI), HIRANANDANI AKRUTI JV V/S DCIT, REPORTED IN 39 SOT 498 (MUM) AND ALSO BY THE SPECIAL BENCH IN THE CASE OF BRAHAM ASS OCIATES, REPORTED IN 119 ITD 255(PUNE SB), WHEREIN THE COORD INATE BENCHES HAVE HELD THAT FOR THE PROJECTS APPROVED PRIOR TO 0 1/04/2005, OLD LAW SHALL APPLY. 10. RESPECTFULLY, FOLLOWING THE DECISIONS, WE DISMI SS THE APPEAL FILED BY THE DEPARTMENT, AS THE FLATS WHOSE MEASUREMENTS WERE TAKEN TO BE EXCEEDING 1000 SQ. FT. INCLUDED THE BALCONY, WHI CH HAD TO BE EXCLUDED FOR THE MEASUREMENT. IN THESE CIRCUMSTANCE S, WE DISMISS THE APPEAL. 8. THE CASE OF THE ASSESSEE IS FURTHER COVERED BY T HE JUDGMENT OF THE HONBLE SUPREME COURT PASSED IN CIT VS. SARKAR BUILDERS, (S UPRA) IN WHICH ONE OF THE ISSUES BEFORE THE HONBLE COURT WAS WHETHER SECTION 80IB(10)(D) APPLIES TO A HOUSING PROJECT APPROVED BEFORE 31/03/2005 BUT COMP LETED ON OR AFTER 01/04/2005. THE HONBLE SUPREME COURT HAS HELD THAT IT WAS CLEAR FROM AMENDMENT THAT THIS PROVISION COULD NOT BE APPLIED TO THOSE PROJECTS WHICH HAVE SANCTIONED AND COMMENCED PRIOR TO 1/4/2005 AND COMPLETED BY STIPULATED DATE, THOUGH SUCH STIPULATED DATE FELL A FTER 1/4/2005. 9. IN VIEW OF THE FINDING OF THE ITAT, MUMBAI IN AS SESSEES OWN CASE FOR THE A.Y. 2006-07 AND THE LAW LAID DOWN BY THE HONBLE SUPREM E COURT IN CIT VS. SARKAR BUILDERS (SUPRA), WE DECIDE THE FIRST GROUND OF APPEAL IN FAVOUR OF THE 6 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 ASSESSEE. IN OUR OPINION SINCE WE HAVE ALLOWED THE FIRST GROUND OF THE APPEAL OF THE ASSESSEE, THERE IS NO NEED TO ADJUDICATE THE AL TERNATIVE GROUND TAKEN BY THE ASSESSEE. THE APPEAL OF THE ASSESSEE IS ALLOWED ACC ORDINGLY. ITA 1108/M/2013 FOR A.Y. 2008-09 THE REVENUE HAS FILED THIS CROSS APPEAL AG AINST THE IMPUGNED ORDER DT. 19/10/2012 PASSED BY THE LD. CIT(APPEALS)-I ON THE FOLLOWING EFFECTIVE GROUNDS :- 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) ERRED IN DELETING AN AMOUNT OF RS. 2,55, 10,148/- BEING DISALLOWANCE MADE ON ACCOUNT OF WRONG CLAIM OF DEDU CTION U/S 80IB(10) OF THE IT ACT, 1961. 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING DEDUCTION U/S 80IB (10) EVEN THOUGH THE COMMERCIAL AREA OF 7947 SQ.FT. IN THE H OUSING PROJECT EXCEEDS 5% OR 2000 SQ.FT. OF THE BUILT UP AREA WHIC HEVER IS LESS 3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN DIRECTING THE A.O. TO ALLOW DEDUCTION U/S 80IB(10) ON PROPORTIONATE BASIS IN CASE WHERE THE A REA OF COMMERCIAL UNIT EXCEEDS 2000 SQ.FT. THIS IS A VIOLA TION OF THE CRITERIA SPECIFIED UNDER THE PROVISIONS OF THE ACT. 4) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING DEDUCTION U/S 80IB (10) EVEN WHEN THE PROJECT WAS NOT COMPLETED BEFORE 31/03/2008 AS PER THE PROVISIONS OF THE SECTION. 5) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DIRECTING THE A.O. TO ALLO W DEDUCTION U/S 80IB(10) ON PROPORTIONATE BASIS IN CASE WHERE THE A REA OF EACH 7 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 RESIDENTIAL UNIT EXCEEDS 1000 SQ.FT. WHICH IS A VIO LATION OF THE PROVISION OF THE ACT. 2. BEFORE US THE LD. DR SUBMITTED THAT THE LD. CIT (A) HAS ERRED IN DELETING THE AMOUNT OF RS. 2,55,10,143/- BEING DISALLOWANCE MADE ON ACCOUNT OF WRONG CLAIM OF DEDUCTION U/S 80IB(10) OF THE ACT. LD. CIT (A) HAS ERRED IN ALLOWING DEDUCTION U/S 80IB(10) EVEN THOUGH THE COMMERCIAL A REA OF 7947 SQ.FT. IN THE HOUSING PROJECT EXCEEDS 5% OR 2000 SQ. FT. OF THE B UILT UP AREA WHICHEVER IS LESS. THE LD. CIT(A) HAS FURTHER WRONGLY ALLOWED DE DUCTION U/S 80IB(10) ON PROPORTIONATE BASIS IN VIOLATION OF CRITERIA SPECIF IED UNDER THE PROVISIONS OF THE ACT. 3. ON THE OTHER HAND THE LD. AR RELYING UPON THE RA TIO LAID DOWN BY HONBLE BOMBAY HIGH COURT IN CIT VS. BRAHMA ASSOCIATES (2011) 333 ITR 0289 AND THE HONBLE SUPREME COURT IN CIT VS. SARKAR BUILDERS (2015)375 ITR392,SC, SUBMITTED THAT THE ASSESSEES CASE IS SQUARELY COVE RED BY AFORESAID JUDGMENTS IN FAVOUR OF THE ASSESSEE THEREFORE, THE APPEAL FIL ED BY REVENUE HAS NO MERIT AND THE SAME IS LIABLE TO BE DISMISSED. 4. WE HAVE PERUSED THE MATERIAL ON RECORD AND ALSO GONE THROUGH THE JUDGMENTS RELIED UPON THE ASSESSEE. GROUND NO 1 AND 5 OF THE APPEAL ARE CONNECTED AND SINCE WE HAVE DECIDED THE ISSUES INVO LVED IN THESE GROUNDS IN FAVOUR OF THE ASSESSEE IN ITA NO 866/M/2013, THESE GROUNDS NEED NO SEPARATE ADJUDICATION. HENCE, BOTH THE GROUNDS RAISED BY THE REVENUE ARE DISMISSED. SO FAR AS GROUND NO 2 AND 3 ARE CONCERNED, THE HONBLE JURISDICTIONAL HIGH COURT WHILE ADJUDICATING THE SIMILAR ISSUES IN CIT VS. BRAHMA ASSOCIATES (SUPRA) HAS HELD AS UNDER 8 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 (A) UPTO 31 ST MARCH, 2005 (SUBJECT TO FULFILLING OTHER CONDITION S), DEDUCTION U/S 80-IB(10) IS ALLOWABLE TO HOUSING PRO JECTS APPROVED BY THE LOCAL AUTHORITY HAVING RESIDENTIAL UNITS WIT H COMMERCIAL USER TO THE EXTENT PERMITTED UNDER THE DC RULES/REGULATI ONS FRAMED BY THE RESPECTIVE LOCAL AUTHORITY. (B) IN SUCH A CASE, WHERE THE COMMERCIAL USER PERMI TTED BY THE LOCAL AUTHORITY IS WITHIN THE LIMITS PRESCRIBED UNDER THE DC RULES/REGULATIONS, THE DEDUCTION U/S 80-IB(10) UPTO 31 ST MARCH, 2005 WOULD BE ALLOWABLE IRRESPECTIVE OF THE FACT TH AT THE PROJECT IS APPROVED AS HOUSING PROJECT OR RESIDENTIAL PLUS COMMERCIAL. (C) IN THE ABSENCE OF ANY PROVISIONS UNDER THE IT A CT, THE TRIBUNAL WAS NOT JUSTIFIED IN HOLDING THAT UPTO 31 ST MARCH, 2005 DEDUCTION U/S 80-IB(10) WOULD BE ALLOWABLE TO THE PROJECTS AP PROVED BY THE LOCAL AUTHORITY HAVING RESIDENTIAL BUILDING WITH CO MMERCIAL USER UPTO 10 PER CENT OF THE TOTAL BUILT-UP AREA OF THE PLOT. (D) SINCE DEDUCTION U/S 80-IB(10) IS ON THE PROFITS DERIVED FROM THE HOUSING PROJECTS APPROVED BY THE LOCAL AUTHORITY AS A WHOLE, THE TRIBUNAL WAS NOT JUSTIFIED IN RESTRICTING SEC. 80-I B(10) DEDUCTION ONLY TO A PART OF THE PROJECT. HOWEVER, IN THE PRESENT C ASE, SINCE THE ASSESSEE HAS ACCEPTED THE DECISION OF THE TRIBUNAL IN ALLOWING SEC. 80-IB(10) DEDUCTION TO A PART OF THE PROJECT, WE DO NOT DISTURB THE FINDINGS OF THE TRIBUNAL IN THAT BEHALF. (E) CLAUSE (D) INSERTED TO SEC. 80-IB(10) W.E.F. 1 ST APRIL, 2005 IS PROSPECTIVE AND NOT RETROSPECTIVE AND HENCE CANNOT BE APPLIED FOR THE PERIOD PRIOR TO 1 ST APRIL, 2005. 5. THE SUPREME COURT HAS CONFIRMED THE DECISION OF THE HONBLE HIGH COURT. SINCE, BOTH THE GROUNDS OF APPEAL ARE COVERED BY TH E AFORESAID CASES IN FAVOUR OF THE ASSESSEE, WE DISMISS GROUND NO. 2 & 3 APPEAL OF THE REVENUE. 6. GROUND NO. 4 IS COVERED BY THE DECISION RENDERED BY THE HONBLE DELHI COURT IN CASE CIT VS. CHD DEVELOPERS LTD. (2014) 43 TAXMA NN.COM 249(DELHI) IN FAVOUR OF THE ASSESSEE. IN THE SAID CASE THE APPROV AL OF PROJECT WAS GIVEN BY MATHURA VRINDHAVAN DEVELOPMENT AUTHORITY ON 16/03/2 005 I.E. APPROVAL 9 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 RELATED TO PERIOD PRIOR TO 01/04/2005. THE ASSESSIN G OFFICER APPLYING THE PROVISIONS OF SUB-SECTION (10) OF SECTION 80I(B) SU BSTITUTED BY THE FINANCE ACT 2004 DISALLOWED THE CLAIM OF DEDUCTION ON THE GROUN D THAT COMPLETION CERTIFICATE IN TERMS OF EXPLANATION (II) OF CLAUSE (A) OF SECTION80I(B) HAD NOT BEEN GRANTED TO THE ASSESSEE SO AS TO ENABLE IT TO AVAIL BENEFIT PROVIDED BY SECTION 80-IB(10). THE HONBLE HIGH COURT UPHOLDING THE FIN DINGS OF THE ITAT HELD THAT THE ASSESSEE WAS NOT REQUIRED TO PRODUCE COMPLETION CERTIFICATE. IN THE PRESENT CASE ALSO THE PROJECT HAD BEEN APPROVED PRIOR TO 1/ 4/2005 THEREFORE, THE ASSESSEE WAS NOT REQUIRED TO COMPLETE THE PROJECT B EFORE 31/3/2008. SINCE THE ISSUE IN THIS CASE IS IDENTICAL TO THE ISSUE DECIDE D IN CIT VS. CHD DEVELOPERS LTD., AND THE HONBLE COURT HAS DECIDED THE IDENTIC AL ISSUE IN FAVOUR OF THE ASSESSEE, WE DECIDE THIS GROUND OF APPEAL IN FAVOUR OF THE ASSESSEE. ACCORDINGLY, WE DISMISS GROUND NO 4 OF APPEAL RAISE D BY THE REVENUE. ITA 874/M/2013 FOR A.Y. 2009-10 THIS APPEAL HAS BEEN FILED BY THE ASSESSEE AGAINST THE ORDER DT. 30/11/2012 PASSED BY THE LD. CIT(APPEALS)-II, THANE FOR THE ASST. YEAR 2009- 10. THE ASSESSEE HAS CHALLENGED THE IMPUGNED ORDER ON THE FOLLOWING EFFECTIVE GROUNDS:- 1. THE HONBLE COMMISSIONER OF INCOME TAX(APPEALS) -II, THANE (CIT(A)) ERRED IN LAW AND IN FACTS BY PROPORTIONATE LY DISALLOWING THE DEDUCTION U/S. 80IB(10), IN RESPECT OF RESIDENTIAL UNITS, WHOSE BUILT UP AREAS EXCEED THE PRESCRIBED LIMIT OF 1000SQUARE FEET AS COMPUTED BY THE AMENDED PROVISIONS OF SEC. 80IB(14) , DISREGARDING THE FACT THAT- (I) THE AMENDED PROVISIONS OF SEC. 80IB(14) ARE TO BE APPLIED PROSPECTIVELY FOR PROJECTS APPROVED AFTER 01/04/200 5 AND NOT RETROSPECTIVELY, WHEREAS IN THE INSTANCE CASE THE HOUSING PROJECT HAS COMMENCED ON 28/05/2003. 10 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 (II) AS PER THE PRE-AMENDED PROVISIONS, THE MAXIMUM BUILT-UP AREA OF NONE OF THE RESIDENTIAL UNITS EXCEED THE PR ESCRIBED LIMIT OF 1000SQUARE FEET AS COMPUTED AND CERTIFIED BY THE ARCHITECT. 2. THE LD. CIT(A) FURTHER ERRED IN THIS CONNECTION BY NOT HONORING AND FOLLOWING THE ORDER OF THE HON ITAT, MUMBAI D BE NCH DATED 05/09/2012 IN THE APPELLANTS OWN CASE FOR A.Y. 200 6-07 WHEREIN THIS PARTICULAR ISSUE IS DECIDED IN FAVOR OF THE AP PELLANT. 3. ALTERNATIVELY, THE PROJECT BEING SITUATED AT BH AYANDAR(W), IT IS BEYOND 25 KILO METERS FROM THE MUNICIPAL LIMITS OF MUMBAI AND THUS AS PER PROVISIONS OF SEC.80IB(10)(C), THE MAXI MUM BUILT-UP AREA PER RESIDENTIAL UNIT CAN EXCEED 1000 SQUARE FEET UP TO A MAXIMUM OF 1500 SQUARE FEET. EVEN IF COMPUTED AS PER THE AMEND ED SEC. 80IB(14), THE MAXIMUM BUILT-UP AREA OF NONE OF THE RESIDENTIAL UNITS OF THE PROJECT EXCEED THIS LIMIT OF 1500 SQUARE FEE T. 2. SINCE THE FACTS OF THE PRESENT CASE ARE SIMILAR TO THE FACTS OF THE ASSESSEES OWN CASE, ITA NO 866/M/2013 FOR THE A.Y. 2008-09, D ISCUSSED HEREIN ABOVE, WE DO NOT CONSIDER IT NECESSARY TO REPRODUCE THE SA ME HERE TO AVOID REPETITION. SIMILARLY, THE GROUNDS OF APPEALS IN THIS CASE ARE IDENTICAL TO THE GROUNDS OF APPEAL IN THE CASE ITA NO 866/M/2013(SUPRA). IN VIE W OF THE FACT THAT WE HAVE ALREADY ALLOWED THE APPEAL FILED BY THE ASSESSEE FO R THE ASSESSMENT YEAR 2008- 09, ON THE IDENTICAL GROUNDS OF APPEAL, WE SET ASID E THE IMPUGNED ORDER PASSED BY THE LEARNED CIT(A) AND ALLOW THE APPEAL FILED BY THE ASSESSEE. ITA 1773/M/2013 FOR A.Y. 2009-10 THE REVENUE HAS FILED THE CROSS APPEALS AG AINST THE ORDER DT. 30/11/2012 PASSED BY THE LD. CIT(APPEALS)-II, THANE FOR THE AS ST. YEAR 2009-10. THE REVENUE HAS FILED THE SAID APPEAL ON THE FOLLOWING EFFECTIVE GROUNDS:- 11 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 1) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) ERRED IN DELETING AN AMOUNT OF RS. 1,28, 84,895/- BEING DISALLOWANCE MADE ON ACCOUNT OF WRONG CLAIM OF DEDU CTION U/S 80IB(10) OF THE IT ACT, 1961. 2) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING DEDUCTION U/S 80IB (10) EVEN THOUGH THE COMMERCIAL AREA OF 7947 SQ.FT. IN THE H OUSING PROJECT EXCEEDS 5% OR 2000 SQ.FT. OF THE BUILT UP AREA WHIC HEVER IS LESS. 3) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN DIRECTING THE A.O. TO ALLOW DEDUCTION U/S 80IB(10) ON PROPORTIONATE BASIS IN CASE WHERE THE A REA OF COMMERCIAL UNIT EXCEEDS 2000 SQ.FT. THIS IS A VIOLA TION OF THE CRITERIA SPECIFIED UNDER THE PROVISIONS OF THE ACT. 4) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN ALLOWING DEDUCTION U/S 80IB (10) EVEN WHEN THE PROJECT WAS NOT COMPLETED BEFORE 31/03/200 8 AS PER THE PROVISIONS OF THE SECTION. 5) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DIRECTING THE A.O. TO ALLO W DEDUCTION U/S 80IB(10) ON PROPORTIONATE BASIS IN CASE WHERE THE A REA OF EACH RESIDENTIAL UNIT EXCEEDS 1000 SQ.FT. WHICH IS A VIO LATION OF THE PROVISION OF THE ACT. 2. SINCE THE FACTS OF THE PRESENT CASE ARE SIMILAR TO THE FACTS OF THE ASSESSEES OWN CASE ITA NO 866/M/2013 FOR THE A.Y. 2008-09, DI SCUSSED HEREIN ABOVE, WE DO NOT CONSIDER IT NECESSARY TO REPRODUCE THE SAME HERE IN ORDER TO AVOID REPETITION. SIMILARLY, THE GROUNDS OF APPEALS RAISE D BY THE REVENUE IN THIS CASE ARE IDENTICAL TO THE GROUNDS OF APPEAL RAISED IN AS SESSEES CASE ITA NO 12 ITA NO.866 & 874/ MUM/2013 & ITA NO.1108 & 1773/MUM/2013 ASSESSM ENT YEAR: 2008-09 & 2009-10 866/M/2013(SUPRA). IN VIEW OF THE FACT THAT WE HAVE ALREADY DISMISSED THE APPEAL FILED BY THE ASSESSEE FOR THE ASSESSMENT YEA R 2008-09, ON THE IDENTICAL ISSUES, WE DISMISS ALL THE FIVE GROUNDS OF APPEAL R AISED BY THE REVENUE. 3. IN THE RESULT, BOTH THE APPEALS FILED BY THE ASS ESSEE ARE ALLOWED AND BOTH THE CROSS APPEALS FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 31 ST MARCH, 2016 SD/- SD/ - ( B.R.BASKARAN ) ( RAM LAL NEGI ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; DATED: 31/03/2016 / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A)- 4. / CIT 5. !' , $ !'% , / DR, ITAT, MUMBAI 6. &' ( / GUARD FILE. / BY ORDER, ) //TRUE COPY// / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI PRAMILA