M/s. Paradise Construction, Pune V. Addl. CIT, Range-4, Pune

ITA 233/PUN/2011

• Counselvise Citation: 23324514 RSA 2011
• Duration Of Justice: 2 year(s) 3 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-06-2013
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 02-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K SINGHSHRI K K OJHA
• Assessee Lawyers: NIKHIL PATHAK SHRI SUHAS BORA
• Section: 80IB

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER , AND SHRI R.K.PANDA, ACCOUNTANT MEMBER. ITA.NO.233/PN/2011 & 346/PN/2012 (ASSTT. YEAR : 2007-08 & 2008-09) PARADISE CONSTRUCTION, 21, GULMOHAR APARTMENT, 2420, EAST STREET, CAMP, PUNE 411001. .. APPELLANT PAN: AAHFP3703C VS. ADDL.CIT, RANGE-4, PUNE. .. RESPONDENT ASSESSEE BY : SHRI NIKHIL PATHAK/ SHRI SUHAS BORA DEPARTMENT BY : SHRI S.K.SINGH/SHRI K.K.OJHA DATE OF HEARING : 04.06.2013 DATE OF PRONOUNCEMENT : 26.06.2013 ORDER PER SHAILENDRA KUMAR YADAV, JM : THESE APPEALS HAVE BEEN FILED BY THE ASSESSEE ON S IMILAR ISSUE FOR BOTH THE YEARS, SO THEY ARE BEING DISPOSED OF B Y A COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN TH E BUSINESS OF PROMOTER, BUILDER AND DEVELOPER. IN A.Y. 2007-08 T HE ASSESSING OFFICER MADE DISALLOWANCE OF DEDUCTION U/S.80IB(10) OF RS.1,00,17,003/- ON THE GROUND THAT THE ASSESSEES PROJECT UNDER THE NAME GULMOHAR PARADISE HOME, KHARADI, WAS NOT C OMPLETED WITHIN THE STIPULATED PERIOD OF TIME. IT IS STATED IN THE ASSESSMENT ORDER THAT THIS PROJECT INITIALLY COMPRISED OF 80 F LATS AS PER COMMENCEMENT CERTIFICATE ISSUED BY PUNE MUNICIPAL C ORPORATION (PMC) ON 28.04.2004. SUBSEQUENTLY, 46 MORE FLATS W ERE ADDED IN TWO BUILDINGS BY THE REVISED SANCTIONED PLAN IN 200 5. THE ASSESSING OFFICER OBSERVED THAT THE ASSESSEE RECEIV ED OCCUPATION/ COMPLETION CERTIFICATE FOR 126 FLATS FROM THE PMC A S FOLLOW: 2 CERTIFICATE PART-I DT. 13.02.2006 FOR 80 FLA TS IN BUILDINGS A & B. CERTIFICATE PART-II DT. 06.05.2008 FOR 40 FL ATS IN BUILDING D. CERTIFICATE PART-III DT. 15.12.2008 FOR 40 F LATS IN BUILDING C. 3. HE OBSERVED THAT FINAL COMPLETION/OCCUPATION CER TIFICATE FOR THE PROJECT WAS NOT ISSUED BY THE PMC AND AS PER TH E BY-LAWS THE ASSESSEE WAS REQUIRED TO HANDOVER 15% OF THE AREA T O PMC FOR AMENITIES. THE ASSESSING OFFICER ASKED THE ASSESSE E WHETHER 15% OF AMENITY AREA WAS HANDED OVER TO THE PMC AND WHET HER ANY ADDITIONAL FSI WAS SANCTIONED BY THE PMC IN LIEU OF THE ABOVE AMENITY AREA. IN RESPONSE TO SAME, THE ASSESSEE EX PLAINED THAT THE PROJECT WAS FOR 126 FLATS FOR WHICH COMPLETION CERT IFICATES WERE RECEIVED BY THE ASSESSEE BEFORE THE DUE DATE I.E., 31.03.2009 IN ACCORDANCE WITH THE REVISED PLAN UPTO 25.05.2005. FURTHER, IN LIEU OF THE 15% OF THE AMENITY AREA, I.E., 1200 SQ.MTRS. IT WAS EXPLAINED THAT ADDITIONAL FSI AMOUNTING TO SALEABLE AREA OF 1 8,700 SQ.FT. WAS SANCTIONED BY PMC VIDE COMMENCEMENT CERTIFICATE DAT ED 10.06.2009, WHICH WAS SUBSEQUENT TO THE DATE OF 31. 03.2009 WHICH WAS THE TIME LIMIT FOR COMPLETION OF PROJECT HAVING 126 FLATS. IT WAS FURTHER EXPLAINED THAT THE ADDITIONAL FSI WAS UTILI SED BY CONSTRUCTION 30 ADDITIONAL FLATS BY ADDING ADDITION AL FLOORS IN BUILDING C. THE SAID ADDITIONAL FSI SANCTIONED W AS RECEIVED ON 10.06.2009 ONLY WHICH WAS AFTER THE COMPLETION OF T HE ORIGINAL HOUSING PROJECT. THE ASSESSING OFFICER INVOKED THE EXPLANATION (I) BELOW SECTION 80IB(10) ACCORDING TO WHICH IN CASE W HERE THE APPROVAL IN RESPECT OF A HOUSING PROJECT ARE OBTAIN ED MORE THAN ONCE, THE HOUSING PROJECT SHALL BE DEEMED TO HAVE B EEN APPROVED ON THE DATE WHEN THE BUILDING PLAN WAS FIRST APPROVED BY THE LOCAL AUTHORITY. THE ASSESSING OFFICER THUS CONCLUDED TH AT WHAT WAS REQUIRED TO BE COMPLETED BY THE ASSESSEE WAS THE HO USING PROJECT IN TOTALITY AND NOT THE 126 FLATS AS CLAIMED BY THE AS SESSEE. THE ASSESSEE HAS SURRENDERED 15% OF THE AREA FOR AMENIT IES TO PMC IN LIEU OF WHICH ADDITIONAL FSI WAS SANCTIONED BY THE PMC VIDE COMMENCEMENT CERTIFICATE DATED 10.06.2009. THE ASS ESSING OFFICER FURTHER OBSERVED THAT THIS COMMENCEMENT LETTER CLEA RLY INDICATED 3 THAT THE THIRD REVISED SANCTIONED PLAN OF THE EXIST ING PROJECT IN WHICH ADDITIONAL 30 FLATS WERE TO BE CONSTRUCTED BY WAY OF ADDING ADDITIONAL FLOORS IN BUILDING C. THEREFORE, IT W AS CONCLUDED THAT THE ASSESSEE HAS REVISED THE SANCTIONED PLAN FOR TH E SANCTIONED PROJECT ONCE MORE IN JUNE, 2009 OF WHICH CONSTRUCTI ON WAS STILL BEING CARRIED OUT AS ON THE DATE OF PASSING OF THE ASSESSMENT ORDER. AS SUCH THE HOUSING PROJECT WAS HELD TO BE NOT COMP LETED WITHIN THE STIPULATED TIME LIMIT PRESCRIBED U/S.80IB(10)(A ), I.E., 31.03.2009. THE ASSESSING OFFICER THUS REJECTED THE ASSESSEES CLAIM OF DEDUCTION U/S.80IB(10). THE ASSESSING OFF ICER ALSO REJECTED THE PLEA THAT AS ON 31.03.2009, SINCE THE CONSTRUCTION OF 126 FLATS WAS COMPLETED AND THE COMPLETION CERTIFIC ATE WAS RECEIVED, THE HOUSING PROJECT SHOULD BE TREATED AS COMPLETED, AS THE ASSESSEE HAD HIMSELF REVISED THE PROJECT PLAN. IT WAS HELD THAT SINCE THE CONSTRUCTION OF BUILDING C WHICH WAS AN INTEGRAL PART OF THE PROJECT WAS STILL CONTINUING, IT CANNOT BE HELD THAT THE PR OJECT WAS COMPLETE WITHIN THE STIPULATED PERIOD. 4. MATTER WAS CARRIED BEFORE THE FIRST APPELLATE AU THORITY, WHO HAS CONSIDERED VARIOUS CONTENTIONS RAISED ON BEHALF OF THE ASSESSEE, UPHELD THE ORDER OF THE ASSESSING OFFICER. SAME HA S BEEN OPPOSED BEFORE US. 5. BEFORE US, THE LD. AUTHORISED REPRESENTATIVE SUB MITTED THAT INITIAL PROJECT WAS APPROVED VIDE COMMENCEMENT CERT IFICATE DATED 28.04.2004 FOR 80 FLATS. VIDE ORDER DATED 25.05.20 04, WHEREBY 46 FLATS WERE ADDED AND COMPLETION CERTIFICATE FOR ABO VE 126 FLATS WERE RECEIVED BY THE ASSESSEE BEFORE DUE DATE I.E., 31.0 3.2009 WHICH WAS TIME LIMIT FOR COMPLETION OF PROJECT HAVING 126 FLA TS. THUS, COMPLETION WAS RECEIVED ON 13.02.2006 FOR BUILDINGS A AND B FOR 80 FLATS. SECOND COMPLETION CERTIFICATE WAS RECEIV ED ON 06.05.2008 FOR 40 FLATS IN BUILDING B AND THIRD COMPLETION C ERTIFICATE FOR REMAINING 6 FLATS IN BUILDING C WAS RECEIVED ON 1 5.12.2008. THUS IT WAS SUBMITTED THAT PROJECT OF 126 FLATS WAS COMP LETED BEFORE DUE DATE, I.E., 31.03.2009 IN ACCORDANCE WITH THE REVIS ED PLAN UPTO 4 25.05.2006. IN LIEU OF 15% OF THE AMENITIES AREA, I.E., 1200 SQ.MTRS., IT WAS EXPLAINED THAT ADDITIONAL FSI AMOU NTING TO SALEABLE AREA OF 18,700 SQ.FT. WAS SANCTIONED BY PMC VIDE CO MMENCEMENT CERTIFICATE DATED 10.06.2009 WHICH WAS SUBSEQUENT T O THE DATE OF 31.03.2009 WHICH WAS THE TIME LIMIT FOR COMPLETION OF THE PROJECT HAVING 126 FLATS. THE LD. AUTHORISED REPRESENTATIV E SUBMITTED THAT ADDITIONAL FSI WAS UTILISED BY CONSTRUCTING 30 ADDI TIONAL FLATS BY ADDING ADDITIONAL FLOOR IN BUILDING C. IT WAS EM PHASISED ON BEHALF OF THE ASSESSEE THAT FOR ADDITIONAL FSI, SANCTION W AS RECEIVED ONLY ON 10.06.2009 WHICH WAS AFTER COMPLETION OF THE ORI GINAL HOUSING PROJECT. IN THIS REGARD, LD. AUTHORISED REPRESENTA TIVE DREW OUR ATTENTION TO COPY OF LETTER BY MAHARASHTRA CHAMBER OF HOUSING INDUSTRY TO FINANCE MINISTER DATED 01.01.2001 WHERE BY CLARIFICATION UNDER PROVISIONS OF SECTION 10(23G) O F THE INCOME TAX ACT WAS SOUGHT, INTER ALIA IN PARA 2 OF THE SAID LE TTER READS AS UNDER: 1] ........ 2] THERE ARE CERTAIN AREAS IN THE PROVISIONS OF LA W UNDER THE INCOME TAX ACT WHICH NEED CLARIFICATION SO AS TO MA KE THEM WORKABLE CONSIDERING THE PRACTICAL GROUND REALITIES OF THE HOUSING SECTOR IN PARTICULAR. THIS WILL ALSO APPLY TO SECTION 80IB(10) IN ADDITION OF SECTION 10(23G). THE SAME ARE DISCUSSED BELOW A) WITH A VIEW TO ENSURE EVEN DEVELOPMENT OF THE AREAS IN METRO CITIES LIKE, MUMBAI, THE LOCAL GOVERNMENT OR THE REGULATORY AUTHORITIES HAVE INTRODUCED WHAT IS POPU LARLY KNOWN AS TRANSFER OF DEVELOPMENT RIGHTS (TDRS). THE DEVELOPER IS THEREFORE, ENTITLED TO UTILIZE SUCH TD RS EVEN ON ITS EXISTING PROJECT, OF COURSE, AFTER OBTAINING SU ITABLE PERMISSIONS / APPROVALS FROM THE APPROPRIATE AUTHOR ITIES IN THIS REGARD. IF A STRICT INTERPRETATION OF THE PROV ISIONS OF THE I. T. ACT IS TAKEN, IT REQUIRES THAT THE PROJECT HA S TO BE OF A PLOT OF LAND, THE SIZE OF WHICH IS A MINIMUM OF 1 A CRE. THIS MAY RESULT IN UNNECESSARY HARDSHIP IN AS MUCH AS IF THE DEVELOPER IS PERMITTED TO UTILIZE THE TDR ON ITS EX ISTING PROJECT WHICH FULFILS THE REQUIREMENT OF THE SIZE O F THE PLOT OF LAND OF MINIMUM 1 ACRE, IT WILL STILL NOT BE ENTITL ED TO THE BENEFIT OF TAX FREE PROFIT IN SPITE OF THE FACT THA T SUCH A DEVELOPER FULFILS THE REMAINING STIPULATIONS CONTAI NED IN THE SAID SECTION 80IB(10) OF THE ACT, IT IS THEREFORE, REQUESTED THAT EVEN THE UTILIZATION OF TDRS ON THE EXISTING H OUSING PROJECTS OR ANY ADDITIONAL CONSTRUCTION ON THE EXIS TING 5 PROJECTS SUBJECT TO FULFILLING THE OTHER STIPULATIO NS TO BE ALSO MADE ELIGIBLE FOR EXEMPTION UNDER SECTION 10(23C) A ND SECTION 80IB(10) OF THE ACT. B) WHAT IS REFERRED TO IN THE I. T. ACT IS THE HOUSING PROJECTS. THE TERM 'HOUSING PROJECT' IS NOT DEFINED ANYWHERE UNDER THE ACT. THEREFORE, THERE IS A POSSIBILITY OF DIFFE RENT VIEWS / POINTS ON THE SUBJECT LEADING TO PROTRACTED LITIGAT ION. THE BASIC ISSUE THAT ARISES IS WITH REGARD TO A DEVELOP ER DEVELOPING AND BUILDING A TOWNSHIP AND / OR A RESID ENTIAL COMPLEX, ETC. IN SUCH SCHEMES, A DEVELOPER IS REQUI RED TO PROVIDE ALL BASIC NECESSITIES WITHIN THE TOWNSHIPS SUCH AS PARK, GREEN AREA, HEALTH CARE FACILITIES, TELEPHONE BOOTH, CONVENIENT STORE, SHOPPING FACILITIES, ETC. THERE I S A POSSIBILITY THAT LEGAL CONTROVERSY MAY ARISE THAT A HOUSING PROJECT MAINLY MEANT FOR RESIDENTIAL AREAS WILL ALS O HAVE SHOPPING AREAS. THE DEPARTMENT IS LIKELY TO TAKE A STRICTER VIEW IN THE MATTER AND REJECT THE CLAIM OF THE DEVE LOPER MERELY ON THE GROUND THAT THERE EXISTS SHOPPING CEN TRES WITHIN THE RESIDENTIAL COMPLEX THOUGH IT MAY FORM A VERY INSIGNIFICANT PORTION OF THE TOTAL PROJECT AREA. HO WEVER, GOING BY THE PRESENT DAY CONCEPT OF TOWNSHIP, FACIL ITIES LIKE SCHOOL, GARDEN PLAY GROUND, ETC ARE MANDATORY. THE UNDERTAKING DEVELOPING THE HOUSING PROJECT IS LIKEL Y TO LOSE THE BENEFIT MERELY ON THE GROUND THAT ANY SUCH HOUS ING PROJECT INCLUDE THE FACILITIES ENUMERATED OR A PUBL IC CIRCULAR MAY BE ISSUED TO ENSURE THAT SUCH LEGAL COMPLICATIO NS MAY NOT ARISE IN FUTURE. ON THE ALTERNATIVE, IT IS RECO MMENDED THAT SUITABLE AMENDMENT BE MADE TO DEFINE THE TERM 'HOUSING PROJECT' TO INCLUDE VARIOUS AMENITIE S AND FACILITIES, INTERALIA, INCLUDING THAT OF A 'CONVENI ENT SHOPPING' ETC. 3] IN VIEW OF THE POSSIBLE PRACTICAL DIFFICULTIES I N REGARD TO IMPLEMENTING THE EXISTING LEGAL PROVISIONS OF SECTI ON 10(23G) AND 80IB(10) EXPLAINED ABOVE, WE REQUEST YOU THAT N ECESSARY CLARIFICATIONS / AMENDMENTS MAY BE ISSUED; (A) UTILIZATION OF TDRS ON THE EXISTING PROJECT OR ANY ADDITIONAL CONSTRUCTION ON THE EXISTING PROJECTS SUBJECT TO FU LFILLMENT OF OTHER STIPULATIONS TO BE ALSO MADE ELIGIBLE FOR EXE MPTION IN SECTION 10(23G) AND 80IB(10) OF THE INCOME TAX ACT, 1961. (B) SUITABLE CLARIFICATION BE MADE TO DEFINE THE TERM ' HOUSING PROJECT' TO INCLUDE VARIOUS AMENITIES AND FACILITIE S, INTERALIA, INCLUDING THAT OF A 'CONVENIENT SHOPPING' ETC. WITH THE ABOVE CLARIFICATIONS, THE MEMBER DEVELOPER S WILL BE ENCOURAGED TO FULFILL THE DREAM OF THE GOVERNMENT T O PROVIDE MORE AND MORE HOUSES. SINCE THE AMENDMENT TO LAW MA Y TAKE SOME TIME, A PRESS NOTE COMMITTING GOVERNMENT'S RES OLVE TO MAKE NECESSARY CHANGES WILL BRING ABOUT NECESSARY P RIVATE INVESTORS TO THE HOUSING SECTOR. 6 6. THE ABOVE CLARIFICATION HAS BEEN CLARIFIED BY CB DTS LETTER IN F.NO.205/3/2001/ITA-II DATED 04.05.2001 AS UNDER. ACCORDING TO SAID CLARIFICATION, THE ADDITIONAL HOU SING PROJECT ON EXISTING HOUSING PROJECT SITE CAN QUALIFY AS INF RASTRUCTURAL FACILITY U/S.10(23G) AND 80IB(10) PROVIDED IT IS TA KEN UP BY SEPARATE UNDERTAKING HAVING SEPARATE BOOKS OF ACCOU NTS SO AS TO ENSURE THAT CORRECT PROFIT COULD BE ASCERTAINED FOR THE PURPOSE OF SECTION 80IB(10) AND ALSO TO IDENTIFY RECEIPTS AND REPAYMENT OF LONG TERM FINANCE UNDER THE PROVISIONS OF SECTION 10(23G ), SEPARATE FINANCING ARRANGEMENT AND ALSO IF IT SEPARATELY FUL FIL ALL STATUTORY CONDITIONS LISTED IN SECTIONS 10(23G) AND 80IB(10). WITH REGARD TO QUERY ON DEFINITION OF HOUSING PROJECT, IT WAS CLAR IFIED THAT IN PROJECT WHICH HAS BEEN APPROVED FOR LOCAL AUTHORITY AS A HO USING PROJECT SHOULD BE CONSIDERED ADEQUATE FOR PURPOSE OF SECTIO N 10(23G) AND 80IB(10). IN THIS BACKGROUND, IT WAS STATED THAT UT ILISATION OF TDR ON EXISTING PROJECT IS ELIGIBLE FOR SECTION 80IB(10 ). 7. IT WAS STATED ON BEHALF OF THE ASSESSEE THAT THE ADDITIONAL CONSTRUCTION OF 30 FLATS IS A SEPARATE PROJECT HAVI NG COMMENCEMENT CERTIFICATE DATED 10.06.2009 WHICH IS SUBSEQUENT TO THE DATE OF 31.03.2009 WHICH WAS THE TIME LIMIT FOR COMPLETION OF PROJECT HAVING 126 FLATS. ALL RECEIPTS AND EXPENSES ARE SE PARATELY IDENTIFIABLE FOR INITIAL 126 FLATS AND SUBSEQUENT 3 0 FLATS. SO CLAIM OF THE ASSESSEE HAS TO BE ALLOWED WITH REGARDS TO 126 FLATS COMPLETED BY 15.12.2008, I.E., BEFORE STIPULATED DATE I.E., 3 1.03.2009. 8. ON THE OTHER HAND, LD. DEPARTMENTAL REPRESENTATI VE SUBMITTED THAT AS PER EXPLATION (I) TO SECTION 80IB (10), WHEREIN APPROVAL IN RESPECT OF HOUSING PROJECT WAS SANCTION ED MORE THAN ONCE, HOUSING PROJECT SHALL BE DEEMED TO HAVE BEEN APPROVED ON DATE WHEN BUILDING PLAN WAS FIRST APPROVED BY THE L OCAL AUTHORITY. THE ASSESSEE WAS REQUIRED TO COMPLETE HOUSING PROJE CT IN TOTALITY AND NOT 126 FLATS AS CLAIMED BY THE ASSESSEE. THE ASSESSEE HAS SURRENDERED 15% OF THE AREA FOR AMENITIES TO PMC IN LIEU OF WHICH ADDITIONAL FSI WAS SANCTIONED BY PMC VIDE COMMENCEM ENT 7 CERTIFICATE DATED 10.06.2009. THE COMMENCEMENT CER TIFICATE CLEARLY INDICATED THAT IT WAS THE REVISED SANCTION PLAN OF THE EXISTING PROJECT IN WHICH ADDITIONAL 30 FLATS WERE BEING CON STRUCTED BY WAY OF ADDITIONAL FLOOR AREA IN BUILDING C. THEREFOR E, THE ASSESSING OFFICER WAS RIGHT IN CONCLUDING THAT ASSESSEE HAS R EVISED THE SANCTION PLAN FOR ITS PROJECT ONCE MORE IN JUNE, 20 09 WHICH CONSTRUCTION WAS STILL BEING CARRIED AS ON DATE OF THE ASSESSMENT ORDER. MOREOVER, BESIDES THIS, LD. DEPARTMENTAL RE PRESENTATIVE SUBMITTED THAT PROJECTS MAY BE TAKEN UP IN DIFFEREN T DATES IN CASE IT HAS SEPARATE UNDERTAKING HAVING SEPARATE BOOKS OF A CCOUNTS SO AS TO ENSURE THAT CORRECT PROFIT COULD BE ASCERTAINED FOR THE PURPOSE OF SECTION 80IB(10). ONLY THEN THE PROJECT COULD BE CO NSIDERED ADEQUATE FOR PURPOSE OF SECTION 80IB(10). ACCORDING LY, ORDER OF THE CIT(A) BE UPHELD. 9. AFTER GOING THROUGH THE RIVAL SUBMISSIONS AND MA TERIAL ON RECORD, WE FIND THAT THE ASSESSEE IS A PARTNERSHIP FIRM ENGAGED IN THE BUSINESS OF PROMOTERS, BUILDERS AND DEVELOPERS. THE ASSESSEE HAD CONSTRUCTED A PROJECT UNDER THE NAME OF GULMOHA R PARADISE HOME, KHARADI. THIS PROJECT INITIALLY COMPRISED OF 80 FLATS AS PER COMMENCEMENT CERTIFICATE ISSUED BY THE PMC ON 28.04 .2004. SUBSEQUENTLY, 46 MORE FLATS WERE ADDED IN SECOND BU ILDING BY REVISED SANCTION PLAN IN 2005. IT IS UNDISPUTED TH AT THE ASSESSEE RECEIVED OCCUPATION/COMPLETION CERTIFICATE FOR 126 FLATS FROM PMC AS FOLLOWS: CERTIFICATE PART-I DT. 13.02.2006 FOR 80 FLA TS IN BUILDINGS A & B. CERTIFICATE PART-II DT. 06.05.2008 FOR 40 FL ATS IN BUILDING D. CERTIFICATE PART-III DT. 15.12.2008 FOR 40 F LATS IN BUILDING C. 10. ACCORDING TO THE ASSESSING OFFICER, THE FINAL COMPLETION/OCCUPATION CERTIFICATE FOR PROJECT WAS N OT ISSUED BY PMC AND AS PER BUILDING BY-LAWS ASSESSEE WAS REQUIRED T O HANDOVER 15% OF THE AREA TO PMC FOR AMENITIES. IN FACT, ASSESSE ES INITIAL PROJECT WAS FOR 126 FLATS FOR WHICH COMPLETION CERTIFICATE WAS RECEIVED BY THE ASSESSEE ON 15.12.2008, I.E., BEFORE DUE DATE O F COMPLETION I.E., 31.03.2009. IN ACCORDANCE WITH THE REVISED PLAN UP TO 25.05.2005, 8 126 FLATS COMPRISED 40 FLATS EACH IN BUILDINGS A, B AND D AND 6 FLATS WERE RAISED IN BUILDING C. THUS, THE ASSES SEE GOT COMPLETION CERTIFICATE WITH REGARDS TO 126 FLATS BEFORE STIPUL ATED TIME PRESCRIBED U/S.80IB(10) I.E., 31.03.2009. SUBSEQUE NT TO THIS, IN LIEU OF 15% OF AMENITIES AREA, I.E., 1200 SQ.MTRS., ADDITIONAL FSI AMOUNTING TO SALEABLE AREA OF 18,700 SQ.FT. WAS SAN CTIONED BY PMC VIDE COMMENCEMENT CERTIFICATE DATED 10.06.2009 WHIC H WAS SUBSEQUENT TO DATE OF 31.03.2009, WHICH WAS TIME LI MIT FOR COMPLETION OF THE PROJECT HAVING 126 FLATS. THE AD DITIONAL FSI WAS UTILISED BY CONSTRUCTING 30 ADDITIONAL FLATS IN BUI LDING C. AS PER CLARIFICATION ISSUED ON BEHALF OF CBDT DATED 04.05. 2001, THE ADDITIONAL HOUSING PROJECT ON EXISTING HOUSING PROJ ECT SITE COULD QUALIFY AS INFRASTRUCTURE FACILITY UNDER THE PROVIS IONS OF SECTION 80IB(10) PROVIDED IT IS UNDERTAKEN BY SEPARATE UNDE RTAKING HAVING SEPARATE BOOKS OF ACCOUNTS SO AS TO ENSURE THAT COR RECT PROFIT COULD BE ASCERTAINED FOR PURPOSE OF SECTION 80IB(10). DE DUCTION U/S. 80IB(10) IS GRANTED VIS-A-VIS PROJECT AND CORRECT P ROFITS ARE ASCERTAINABLE WITH REGARDS TO PROFITS FROM ADDITION AL PROJECT. BUT HERE IN CASE BEFORE US, IT IS NOT THE CASE OF ASSES SEE BECAUSE ASSESSEE HAS NOT CLAIMED DEDUCTION U/S. 80IB(10) W ITH REGARD TO ADDITIONAL FLATS RAISED IN BUILDING C AT THE STRE NGTH OF ADDITIONAL FSI IN LIEU OF SURRENDER OF 15% OF AMENITIES AREA T O PMC. TAKING THE SPIRIT OF CLARIFICATION OF CBDT LETTER DATED 04 .05.2001, IT IS CLEAR THAT ADDITIONAL CONSTRUCTION AT THE STRENGTH OF TDR QUALIFY FOR CLAIM OF DEDUCTION IN ITS OWN FACTS AND CIRCUMSTANCES. S AME REASONING APPLY FOR ADDITIONAL FSI RECEIVED IN LIEU OF SURREN DER OF 15% OF AMENITIES AREA BY THE ASSESSEE. SO THE CONSTRUCTIO N AT THE STRENGTH OF ADDITIONAL FSI SHOULD BE TAKEN SEPARATE FOR PURP OSE OF CLAIMING DEDUCTION U/S.80IB(10). HAVING SAID SO, IT IS CLEA R THAT CONSTRUCTION OF INITIAL 126 FLATS AS MENTIONED ABOV E SHOULD NOT BE LINKED WITH ADDITIONAL 30 FLATS COMPLETED SUBSEQUEN T TO 31.03.2009. HAD THE ASSESSEE BEEN ELIGIBLE FOR DED UCTION U/S.80IB(10) EVEN SUBSEQUENT TO 31.03.2009, HIS CLA IM WOULD HAVE BEEN ENTITLED FOR WITH REGARDS TO 30 FLATS AS WELL. BUT THERE IS NO CLAIM OF 30 FLATS WITH REGARD TO DEDUCTION U/S.80IB (10). BUT CLAIM 9 OR NO CLAIM OF 30 FLATS RAISED AT THE STRENGTH OF A DDITIONAL FSI WILL NOT DISTURB THE ENTITLEMENT OF 126 FLATS RAISED ON BUILDINGS A (40 FLATS), B (40 FLATS) , C (6 FLATS) AND D (40 FLATS), WHICH WERE COMPLETED IN ALL RESPECTS ON 15.12.2008, I.E., BEFO RE 31.03.2009. THE BENEFICIAL PROVISIONS OF SECTION 80IB(10) SHOUL D NOT BE DILUTED BY NARROW UNTENABLE INTERPRETATION BY THE REVENUE A UTHORITIES. ACCORDINGLY, WE HOLD THAT THE ASSESSEE IS ENTITLED FOR CLAIMING DEDUCTION U/S.80IB(10) IN RESPECT OF 126 FLATS COMP LETED BEFORE 31- 3-2009 AS DISCUSSED ABOVE. THE ASSESSING OFFICER I S DIRECTED ACCORDINGLY. SIMILAR ISSUE AROSE IN A.Y. 2008-09. FACTS BEING SIMILAR, SO FOLLOWING SAME REASONING, THE CLAIM OF DEDUCTION U/S.80IB(10) IS DIRECTED TO BE ALLOWED. 11. AS A RESULT, BOTH THE APPEALS FILED BY THE ASSE SSEE ARE ALLOWED. PRONOUNCED IN THE OPEN COURT ON THIS THE 26 TH DAY OF JUNE, 2013. SD/- SD/- ( R.K.PANDA ) ( SHAILENDRA KUMAR YAD AV ) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED THE 26 TH JUNE, 2013 ANKAM COPY OF THE ORDER IS FORWARDED TO: 1. THE ASSESSEE 2. THE ADDL.CIT, RANGE-4, PUNE. 3. THE CIT(A)-II, PUNE. 4. THE CIT-II, PUNE. 5. THE DR B BENCH, PUNE. 6. GUARD FILE. BY ORDER SR. PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, PUNE.