M/s Vertex Homes Private Limited, Hyderabad V. DCIT., Circle-3(3), Hyderabad, Hyderabad

ITA 2/HYD/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 98450 (ITAT-HYDERABAD)
• Duration Of Justice: 7 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-08-2015
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 29-07-2015
• Assessment Year: 2011-2012
• Appeal Filed On: 01-01-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: V RAGHAVENDRA RAO
• Keywords: Competent authority
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA NOS. 01 AND 02/HYD/2015 ASSESSMENT YEARS: 2010-11 & 2011-12 VERTEX HOMES PVT. LTD., HYDERABAD. PAN AABCV 2364G VS. DY. COMMISSIONER OF INCOME- TAX, CIRCLE 3(3), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI V. RAGHAVENDRA RAO REVENUE BY : SHRI PRABHAT KUMAR GUPTA DATE OF HEARING 29-07-2015 DATE OF PRONOUNCEMENT 26-08-2015 O R D E R PER SAKTIJIT DEY, J.M.: THESE APPEALS BY ASSESSEE ARE DIRECTED AGAINST SEP ARATE ORDERS, BOTH, DATED 07/11/2014 OF LD. COMMISSIONE R OF INCOME-TAX (A) IV, HYDERABAD FOR AYS 2010-11 AND 2011-12. 2. THE SOLITARY ISSUE ARISING FOR CONSIDERATION IN BOTH THE APPEALS IS RELATED TO DENIAL OF ASSESSEES CLAIM OF DEDUCTI ON U/S 80IB(10) OF THE ACT. 3. AS FACTS ARE COMMON IN BOTH THE APPEALS, FOR THE SAKE OF CONVENIENCE WE WILL REFER TO THE FACTS AS INVOLVED IN AY 2010-11 BEING ITA NO. 01/HYD/2015. 4. BRIEFLY THE FACTS ARE, ASSESSEE A COMPANY IS ENG AGED IN THE BUSINESS OF CONSTRUCTION OF RESIDENTIAL APARTMENTS/ HOUSING PROJECTS. 2 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. FOR THE AY UNDER CONSIDERATION, ASSESSEE FILED ITS RETURN OF INCOME ON 28/09/2010, DECLARING TOTAL INCOME OF RS. 42,99,135 AFTER CLAIMING DEDUCTION U/S 80IB(10) FOR AN AMOUNT OF RS. 38,74,4 35 IN RESPECT OF ITS HOUSING PROJECT NAMED VERTEX SADGURU KRUPA SITU ATED AT SURVEY NOS. PART 76/B AND 77/B, HYDERNAGAR VILLAGE, NIZAMP ET ROAD, HYDERABAD. DURING THE ASSESSMENT PROCEEDING, AO WHI LE EXAMINING ASSESSEES CLAIM OF DEDUCTION U/S 80IB(10), FOUND F ROM THE INFORMATION AVAILABLE ON RECORD THAT THOUGH ASSESSE E CLAIMED TO HAVE ACQUIRED LAND IN SURVEY NO. PART 76/B AND 77/B, HYD ERNAGAR VILLAGE, NIZAMPET ROAD, HYDERABAD, FROM SOME PERSONS, BUT, L ANDS WERE NEVER ACQUIRED BY ASSESSEE COMPANY, BUT, THEY WERE TAKEN FOR EXECUTION OF WORKS CONTRACT ON LEASE BASIS THROUGH AN AGREEMENT OF SALE-CUM-GPA ONLY. THUS, IT WAS INFERRED BY AO THAT AS PER THE AMENDED PROVISIONS OF SECTION 80IB(10), DEDUCTION C ANNOT BE ALLOWED WHEREIN ASSESSEE EXECUTES HOUSING PROJECT AS A WORK S CONTRACT AWARDED BY ANY PERSON INCLUDING THE STATE OR CENTRA L GOVT. HE ALSO NOTED THAT THOUGH ASSESSEE HAD ALSO EXECUTED SOME O THER HOUSING PROJECTS, BUT, EXCEPT HOUSING PROJECT NAMED VERTEX SADUGUR KRUPA, ASSESSEE HAS NOT CLAIMED 80IB(10) DEDUCTION IN RESP ECT OF OTHER HOUSING PROJECTS. HE OBSERVED THAT ASSESSEE HAS SHO WN RELATIVELY HIGH PROFIT PERCENTAGE OF 8.81 IN RESPECT OF SADGUR U KRUPA COMPARED TO OTHER PROJECTS. ON THE BASIS OF THE AFORESAID RE ASONING, AO DISALLOWED ASSESSEES CLAIM OF DEDUCTION U/S 80IB(1 0). BEING AGGRIEVED OF DISALLOWANCE OF CLAIM OF DEDUCTION U/S 80IB(10), ASSESSEE CHALLENGED THE SAME IN APPEAL PREFERRED BE FORE LD. CIT(A). 5. ASSESSEE CONTESTING THE GROUND ON WHICH AO DISAL LOWED ASSESSEES CLAIM OF DEDUCTION U/S 80IB(10) ADVANCED DETAILED ARGUMENT. LD. CIT(A) AFTER CONSIDERING THE SUBMISSI ONS OF ASSESSEE, FOUND MERIT IN THE SAME WHILE OBSERVING THAT REASON INGS ON WHICH AO DENIED ASSESSEES CLAIM OF DEDUCTION U/S 80IB(10) A RE NOT VALID. HOWEVER, SHE FOUND THAT HOUSING PROJECT SADGURU KR UPA WAS APPROVED BY MUNICIPAL COMMISSIONER, KUKATPALLY ON 3 0/03/07, THEREFORE, ASSESSEE WAS REQUIRED TO COMPLETE THE PR OJECT BY 3 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. 31/03/2011 I.E. WITHIN A PERIOD OF FOUR YEARS FOR C LAIMING DEDUCTION U/S 80IB(10). AS OBSERVED BY LD. CIT(A), IN COURSE OF A PPEAL PROCEEDING WHEN ASSESSEE WAS ASKED TO FURNISH THE COMPLETION CERTIFICATE FOR THE SADGURU KRUPA PROJECT, ASSESSEE FILED A PARTIAL COMPLETION CERTIFICATE DATED 31/12/2011 ISSUED BY GHMC WHEREIN IT WAS MENTIONED THAT OUT OF SIX BLOCKS IN THE PROJECT I. E. BLOCK A TO F, ASSESSEE HAS COMPLETED THREE BLOCKS I.E. A, B & F W ITH ALL AMENITIES WHICH ARE FIT FOR OCCUPATION. FROM COMPLETION CERTI FICATE ISSUED BY GHMC, LD. CIT(A) FOUND THAT THOUGH THE APPROVAL FOR THE PROJECT WAS FOR CONSTRUCTION OF SIX RESIDENTIAL BLOCKS, WHICH F ORMED PART OF ONE SINGLE HOUSING PROJECT, ASSESSEE HAS COMPLETED ONLY THREE OF THE BLOCKS. REFERRING TO THE PROVISION CONTAINED U/S 80 IB(10), LD. CIT(A) OPINED THAT THE PROVISION REFERS TO APPROVAL OF A H OUSING PROJECT AND IT DOES NOT ENVISAGE FOR PART OF THE HOUSING PROJECT E ITHER IN TERMS OF PLOTS OR BLOCKS THEREOF. SHE FURTHER OPINED THAT SE CTION 80IB(10)(A) REFERS TO CONSTRUCTION OF THE HOUSING PROJECT AND R EQUIRES THAT ASSESSEE COMPLETES SUCH CONSTRUCTION WITHIN THE SPE CIFIED PERIOD, HENCE, NO BENEFIT CAN BE ALLOWED ON PARTIAL COMPLET ION OF THE PROJECT. IN THIS CONTEXT, SHE REFERRED TO THE CBDT INSTRUCTI ON NO. 4/09 DATED 30/06/09. SHE ALSO PLACED RELIANCE UPON A DECISION OF THE ITAT, HYDERABAD BENCH IN CASE OF SAINATH ESTATES PVT. LTD ., IN ITA NO. 299-300/HYD/12, DATED 08/02/13 WHEREIN IT WAS HELD THAT FURNISHING OF COMPLETION CERTIFICATE IN TERMS OF SECTION 80IB(10) IS MANDATORY. THUS, LD. CIT(A) CONCLUDED THAT AS ASSESSEE HAS NOT COMPLETED THE ENTIRE HOUSING PROJECT AND THE COMPLETION CERTIFICA TE IS ONLY FOR THREE BLOCKS, ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION U/S 80IB(10)/ SHE OBSERVED THAT EVEN PARTIAL COMPLETION CERTIFICATES WAS ISSUED ON 30/12/2011 WHEREAS AS PER THE PROVISIONS OF SECTION 80IB(10), THE PROJECT SHOULD HAVE BEEN COMPLETED BY 31/03/2011. T HUS, ON THE AFORESAID CONSIDERATION, SHE DISALLOWED ASSESSEES CLAIM OF DEDUCTION U/S 80IB(10). 6. LD. AR SUBMITTED BEFORE US, NONE OF THE REASONS ON WHICH AO DISALLOWED ASSESSEES CLAIM OF DEDUCTION U/S 80IB(1 0) WERE FOUND TO 4 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. BE VALID BY LD. CIT(A). HOWEVER, LD. CIT(A) FOUND OUT A NEW REASON IN DISALLOWING ASSESSEES CLAIM OF DEDUCTION U/S 80IB( 10) BY HOLDING THAT AS ASSESSEE HAS FAILED TO FURNISH COMPLETION CERTIF ICATE FOR THE ENTIRE PROJECT AND ONLY SUBMITTED A PARTIAL COMPLETION CER TIFICATE IT IS NOT ELIGIBLE FOR DEDUCTION U/S 80IB(10). LD. AR SUBMITT ED, APPROVAL GRANTED BY COMPETENT AUTHORITY IS FOR RESIDENTIAL A PARTMENTS AND NOT ANY PARTICULAR PROJECT. LD. AR SUBMITTED, ASSESSEE HAS OBTAINED PERMISSION TO BUILD SIX DIFFERENT BLOCKS AND THE C LAIM OF DEDUCTION U/S 80IB(10) IS RESTRICTED TO THREE BLOCKS WHICH WERE F ULLY COMPLETE AND ASSESSEE HAS ALSO SUBMITTED COMPLETION CERTIFICATE FROM THE MUNICIPAL AUTHORITIES. THEREFORE, ASSESSEE HAVING COMPLIED T O THE CONDITIONS U/S 80IB(10) OF THE ACT, IT IS ELIGIBLE TO CLAIM DE DUCTION. LD. AR FURTHER SUBMITTED, FOR A HOUSING PROJECT APPROVED AFTER FIR ST APRIL, 2005, IT HAS TO BE COMPLETED WITHIN FIVE YEARS FROM THE END OF T HE FY IN WHICH HOUSING PROJECT IS APPROVED. HE SUBMITTED, LD. CIT( A) HAS THEREFORE COMPLETELY ERRED WHILE OBSERVING THAT ASSESSEE SHOU LD HAVE COMPLETED THE PROJECT BY 31/03/2011. LD. AR SUBMITT ED, ASSESSEE HAVING COMPLETED THREE BLOCKS WITH ALL AMENITIES WH ICH COVERS AN AREA OF MORE THAN ONE ACRE AND AS THE BUILT UP AREA OF EACH RESIDENTIAL UNIT IS NOT EXCEEDING 1500 SQ.FT., IT I S ELIGIBLE FOR CLAIMING DEDUCTION U/S 80IB(10). HE SUBMITTED, ONLY BECAUSE SOME OTHER BLOCKS IN THE HOUSING PROJECT HAVE NOT BEEN COMPLET ED, IT WILL NOT DISENTITLE ASSESSEE FROM AVAILING DEDUCTION U/S 80I B(10) FOR THE RESIDENTIAL BUILDINGS WHICH WERE COMPLETED WITHIN T HE STIPULATED PERIOD. IN SUPPORT OF SUCH CONTENTION, LD. AR RELIE D UPON THE FOLLOWING DECISIONS: 1. RAHUL CONSTRUCTION CO VS. ITO, [2012] 21 TAXMAN .COM 435 2. CIT VS. B.M. & BROTHERS, [2014] 42 TAXMAN.COM 2 4 (GUJ) 3. CIT VS. VANDANA PROPERTIES, 35 ITR 36 (BOM.) 7. LD. DR, ON THE OTHER HAND, SUBMITTED, HOUSING PROJECT OF ASSESSEE APPROVED BY THE LOCAL AUTHORITY CONSISTS O F SIX BLOCKS, WHEREAS, ASSESSEE HAS SUBMITTED COMPLETION CERTIFIC ATE IN RESPECT OF 5 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. THREE BLOCKS. THEREFORE, SINCE CONSTRUCTION OF THE ENTIRE HOUSING PROJECT I.E. SIX BLOCKS HAVE NOT BEEN COMPLETED, AS SESSEE IS NOT ELIGIBLE TO AVAIL DEDUCTION U/S 80IB(10). LD. DR RE FERRING TO THE PROVISION CONTAINED U/S 80IB(10) SUBMITTED, ASSESSE E HAS TO COMPLETE ENTIRE HOUSING PROJECT WITHIN THE STIPULATED TIME O F FIVE YEARS. AS ASSESSEE HAS NOT COMPLETED THE ENTIRE HOUSING PROJE CT AND HAS COMPLETED ONLY PART OF IT, ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION U/S 80IB(10). 8. WE HAVE CONSIDERED THE SUBMISSIONS OF THE PARTIE S AND PERUSED THE ORDERS OF REVENUE AUTHORITIES AS WELL AS OTHER MATERIAL ON RECORD. THERE IS NO DISPUTE TO THE FACT THAT HOUSING PROJEC T OF ASSESSEE CONSISTING OF SIX BLOCKS ( BLOCK A TO F) WAS APPROV ED BY LOCAL AUTHORITY ON 30/03/2007. THEREFORE, AS PER SECTION 80IB(10)(A)(III), THE PROJECT HAS TO BE COMPLETED WITHIN FIVE YEARS FROM THE END OF FY IN WHICH HOUSING PROJECT WAS APPROVED FOR CLAIMING DED UCTION U/S 80IB(10). IN THE PRESENT CASE, THERE IS NO DISPUTE TO THE FACT THAT WITHIN THE STIPULATED PERIOD OF FIVE YEARS, ASSESSE E HAS COMPLETED ONLY THREE BLOCKS I.E. BLOCK A, B & F WHEREAS THE OTHER THREE BLOCKS C, D & E HAVE NOT BEEN COMPLETED. ASSESSEE ALSO ADM ITS THIS FACTUAL POSITION. IT IS ALSO A FACT ON RECORD THAT IN RESPE CT OF BLOCK A, B & F, ASSESSEE HAS SUBMITTED A COMPLETION CERTIFICATE FRO M THE MUNICIPAL AUTHORITIES CERTIFYING THAT THESE THREE BLOCKS ARE COMPLETE IN ALL RESPECTS WITH ALL AMENITIES. IN VIEW OF THE AFORESA ID FACTUAL POSITION, THE ISSUE WHICH ARISES FOR CONSIDERATION IS WHETHER ASSESSEE CAN CLAIM DEDUCTION U/S 80IB(10) IN RESPECT OF THREE BL OCKS, WHICH ARE FULLY COMPLETE. AS COULD BE SEEN, LD. CIT(A) HAS DI SALLOWED ASSESSEES CLAIM OF DEDUCTION SOLELY ON THE BASIS T HAT ENTIRE HOUSING PROJECT HAS NOT BEEN COMPLETED WITHIN THE STIPULATE D PERIOD. ON A REFERENCE TO PROVISION AS CONTAINED U/S 80IB(10), I T IS EVIDENT THAT ASSESSEE SHALL BE ELIGIBLE FOR 100% DEDUCTION OF TH E PROFITS DERIVED IN RESPECT OF A HOUSING PROJECT SUBJECT TO FULFILLMENT OF THE CONDITIONS MENTIONED THEREIN. IN THE PRESENT CASE, THERE IS NO DISPUTE THAT BLOCK A, B & F COMPRISES OF AREA OF MORE THAN 1 ACRE. TH ERE IS ALSO NO 6 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. DISPUTE TO THE FACT THAT NONE OF THE RESIDENTIAL U NIT IN THE AFORESAID THREE BLOCKS IS HAVING A BUILT UP AREA IN EXCESS O F 1500 SQ.FT. IT IS ALSO A FACT ON RECORD THAT IN RESPECT OF THE AFORES AID THREE BLOCKS, ASSESSEE HAS SUBMITTED COMPLETION CERTIFICATE FROM THE MUNICIPAL AUTHORITIES. THUS, AS FAR AS BLOCKS A, B & F ARE CO NCERNED, ASSESSEE FULLY SATISFIES THE CONDITIONS FOR CLAIMING DEDUCTI ON U/S 80IB(10). THAT BEING THE CASE, WE DO NOT SEE ANY REASON WHY ASSESS EE SHOULD BE DEPRIVED OF SUCH BENEFIT CONFERRED BY STATUTE. THOU GH, IT MAY BE A FACT THAT ASSESSEE HAS NOT COMPLETED ALL THE SIX BL OCKS, BUT, IN OUR VIEW THAT WILL NOT DEPRIVE ASSESSEE FROM AVAILING D EDUCTION U/S 80IB(10) IN RESPECT OF EACH OF THE COMPLETED BLOCK ON STAND ALONE BASIS. THE HONBLE BOMBAY HIGH COURT IN CASE OF CIT VS. VANDANA PROPERTIES (SUPRA) WHILE REFERRING TO THE TERM HO USING PROJECT HAS OBSERVED THAT IT HAS NOT BEEN DEFINED EITHER U/S 2 OF THE ACT OR U/S 80IB(10), HENCE, IT HAS TO BE UNDERSTOOD AS PER COM MON PARLANCE. THE HONBLE COURT OBSERVED THAT HOUSING PROJECT I N COMMON PARLANCE WOULD MEAN CONSTRUCTING A BUILDING OR GRO UP OF BUILDINGS CONSISTING OF SEVERAL RESIDENTIAL UNITS. THEREFORE, DEDUCTION U/S 80IB(10) WILL BE ALLOWABLE EVEN IN RESPECT OF ONE B UILDING WITH SEVERAL RESIDENTIAL UNITS, IF IT OTHERWISE FULFILLS CONDITI ONS OF SECTION 80IB(10). THE ITAT, PUNE BENCH IN CASE OF RAHUL CONSTRUCTION CO. VS. ITO (SUPRA), WHILE DECIDING THE DISPUTE OF IDENTICAL NA TURE, HELD AS UNDER: IN THE CASE OF SAROJ SALES ORGANISATION (SUPRA), BEFORE MUMBAI BENCH, ALMOST SIMILAR FACTS AS BEFORE US WERE THER E-. 'THE COMMENCEMENT CERTIFICATE IN RESPECT OF SIX WINGS I N BLOCK 'N' WAS SEPARATELY RECEIVED BY THE ASSESSEE AND ALL TH E FLATS IN BLOCK WERE LESS THAN 1000 SQ.FT. IT WAS HELD BY TH E TRIBUNAL THAT IT IS NOT ' UPON TO THE REVENUE TO INCLUDE BLOCK ' BC' AS PART OF BLOCK 'N' JUST TO DENY RELIEF TO THE ASSESSEE U/S. 80 IB(10). THE TRIBUNAL OBSERVED THAT BLOCK 'BC' WAS MEANT FOR HI GHER STRATA OF THE SOCIETY HAD BEEN KEPT SEPARATELY BY ASSESSE E IN ALL THE RESPECT, ASSESSEE HAD NOT CLAIMED RELIEF U/S. 80IB IN RESPECT OF BLOCK 'BC'. IN THE CASE OF MUDHIT MADANLAL GUPTA ( SUPRA) BEFORE THE MUMBAI BENCH, IT HAS BEEN HELD THAT THE HOUSING PROJECT DOES NOT NECESSARILY HAVE TO BE VARIOUS GR OUP OF BUILDINGS CONSTRUCTED ON THAT PARTICULAR LAND, BUT IT CAN ALSO BE A PARTICULAR BUILDING OR ANY BUILDING WHICH IS PAR T OF LARGE PROJECT. IT HAS BEEN FURTHER HELD THAT WHATEVER PO RTION OF THE 7 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. HOUSING PROJECT IS OTHERWISE FOUND TO BE ELIGIBLE HAS TO BE CONSIDERED AS A HOUSING PROJECT FOR THE PURPOSE OF DEDUCTION U/S, 80 IB (10) OF THE ACT. SIMILAR VIEW HAS BEEN EXPRESSED BY MUMBAI BENCH OF THE TRIBUNAL IN THE CASE OF VANDAN A PROPERTIES(SUPRA). 8.1 THUS, THE PRINCIPLE WHICH EMERGES FROM THE AFOR ESAID JUDICIAL PRECEDENTS IS, EVEN A SINGLE BUILDING CONSISTING OF A NUMBER OF RESIDENTIAL UNITS CAN BE CONSIDERED TO BE A HOUSIN G PROJECT BY ITSELF, HENCE, WILL BE ELIGIBLE FOR DEDUCTION U/S 80IB(10), IF IT OTHERWISE FULFILLS THE CONDITIONS OF SECTION 80IB(10). APPLYING THE A FORESAID PRINCIPLES TO THE FACTS OF THE PRESENT CASE, IT IS VERY MUCH E VIDENT THAT BLOCKS A, B & F IN RESPECT OF WHICH ASSESSEE HAS CLAIMED DEDU CTION U/S 80IB(10) ARE FULFILLING ALL THE CONDITIONS OF THE S AID PROVISION. IT IS ALSO A FACT THAT MUNICIPAL AUTHORITIES HAVE ALSO ISSUED COMPLETION CERTIFICATE CERTIFYING THAT THE BUILDINGS ARE COMPL ETE IN ALL RESPECTS. IN THE AFORESAID VIEW OF THE MATTER, ASSESSEE, SINCE HAS FULFILLED ALL CONDITIONS OF SECTION 80IB(10) IN RESPECT OF BLOCKS A, B & F, IT IS ELIGIBLE FOR DEDUCTION U/S 80IB(10). PROVISIONS OF SECTION 80IB(10) BEING BENEFICIAL IN NATURE, TOO TECHNICAL A APPROAC H, WOULD DEFEAT THE PURPOSE FOR WHICH PROVISION HAS BEEN BROUGHT INTO T HE STATUTE. MOREOVER, AS FAR AS LD. CIT(A)S OBSERVATION THAT T HE HOUSING PROJECT SHOULD HAVE BEEN COMPLETED BY 31/03/2011, WE DO NOT FIND THE SAME TO BE ACCEPTABLE. AS ASSESSEES HOUSING PROJECT HA S BEEN APPROVED AFTER 1 ST APRIL, 2005, THE STIPULATED PERIOD WITHIN WHICH AS SESSEE HAS TO COMPLETE THE PROJECT IS FIVE YEARS. ASSESSEE HAV ING COMPLETED BLOCKS A, B & F WITHIN FIVE YEARS FROM THE DATE OF APPROVAL, IN OUR VIEW, IT IS ELIGIBLE TO CLAIM DEDUCTION U/S 80IB(10 ) IN RESPECT OF BLOCKS A, B & F. 8.2 THOUGH, IN PRINCIPLE, WE AGREE THAT ASSESSEE IS ELIGIBLE TO CLAIM DEDUCTION U/S 80IB(10) IN RESPECT OF BLOCKS A, B & F, HOWEVER, THE QUANTUM OF DEDUCTION HAS TO BE VERIFIED. AS COULD B E SEEN, ASSESSEE HAS BEEN RECOGNIZING REVENUE FROM SADGURU KRUPA PRO JECT BY FOLLOWING PERCENTAGE COMPLETION METHOD AND PROJECT OF THE ASSESSEE HAS STARTED IN FY 2007-08. AS IT APPEARS, ASSESSEE IN THE YEARS UNDER 8 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. CONSIDERATION I.E. AYS 2010-11 AND 2011-12 HAS RECO GNIZED REVENUE ON PERCENTAGE COMPLETION METHOD AND HAS ALSO CLAIME D DEDUCTION U/S 80IB(10) ON THAT BASIS. THEREFORE, IT IS VERY MUCH NECESSARY AND ESSENTIAL TO VERIFY WHETHER DEDUCTION CLAIMED IN TH ESE TWO AYS IS FOR THE ENTIRE PROJECT (ALL SIX BLOCKS) OR ONLY BLOCKS A, B & F. NEITHER THE AO HAS EXAMINED THIS ASPECT NOR THE ASSESSEE HAS BR OUGHT ANY MATERIAL ON RECORD TO INDICATE THAT DEDUCTION CLAIM ED U/S 80IB(10) FOR THESE TWO YEARS IS ONLY IN RESPECT OF BLOCKS A, B & F. WHEN THE ASSESSEE STARTED THE PROJECT IN FY 2007-08, HE COUL D NOT HAVE VISUALIZED THAT WITHIN THE STIPULATED PERIOD OF FIV E YEARS IT CAN COMPLETE ONLY THREE BLOCKS. AS THE ASSESSEE IS FOLL OWING PERCENTAGE PROJECT COMPLETION METHOD, IT IS QUITE POSSIBLE THA T ASSESSEE MIGHT HAVE RECOGNIZED REVENUE AND CLAIMED DEDUCTION U/S 8 0IB(10) ALSO IN RESPECT OF BLOCKS OTHER THAN BLOCKS A, B & F. IN CA SE, ASSESSEE HAS CLAIMED DEDUCTION U/S 80IB(10) IN RESPECT OF ANY BL OCK OTHER THAN BLOCKS A, B & F, SUCH DEDUCTION HAS TO BE RESTRICTE D ONLY TO THE EXTENT OF PROFIT ATTRIBUTABLE TO BLOCKS A, B & F.. WHILE C OMPUTING ASSESSEES CLAIM OF DEDUCTION U/S 80IB(10), AO HAS TO EXAMINE THIS ASPECT. WITH THE AFORESAID OBSERVATIONS, WE SET ASIDE THE IMPUGN ED ORDERS OF LD. CIT(A) AND REMIT THE MATTER BACK TO AO FOR DECIDING AFRESH KEEPING IN VIEW OUR DIRECTION HEREINABOVE AFTER DUE OPPORTUNIT Y OF BEING HEARD TO ASSESSEE. 9. IN THE RESULT, BOTH THE APPEALS OF ASSESSEE ARE ALLOWED FOR STATISTICAL PURPOSES. PRONOUNCED IN THE OPEN ON 26 TH AUGUST, 2015. SD/- SD/- (P.M. JAGTAP) (SAKTIJIT DEY) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 26 TH AUGUST, 2015 KV 9 ITA NOS. 1 & 2 /HYD/2015 M/S VERTEX HOMES PVT. LTD. COPY TO:- 1) M/S VERTEX HOMES PVT. LTD., C/O I.R. RAO & CO., CAS., C-69, MADHURA NAGAR, 8-3-222/C-29, HYDERABAD 500 038 2) DCIT, CIRCLE 3(3), IT TOWERS, SHANTI NAGAR, M ASAB TANK, HYDERABAD 3 CIT(A)-IV, HYDERABAD 4) CIT-III, HYDERABAD 5) THE DEPARTMENTAL REPRESENTATIVE, I.T.A.T., HYDE RABAD.