ACIT, New Delhi V. M/s Girija Colonisers, New Delhi

ITA 2420/DEL/2011

• Counselvise Citation: 242020114 RSA 2011
• Duration Of Justice: 6 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 17-11-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 11-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SALIL MISHRA
• Keywords: Business income; Retrospective amendment; Additional evidence; Competent authority
• Section: 143(3); 80IB; 133(6); 147; 37; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH `C: NEW DELHI BEFORE SHRI G.D. AGARWAL, VICE PRESIDENT AND SHRI C.L. SETHI, JUDICIAL MEMBER I.T. A. NOS.2417 TO 2422/DEL/2011 ASSESSMENT YEARS : 2002-03 TO 2007-08 ASSTT. COMMISSIONER OF INCOME-TAX, M/S. GIRIJA COL ONISERS, CIRCLE 27(1), NEW DELHI. VS. C-47, NARAINA VIH AR, PHASE-I, NEW DELHI. PAN: AABFG8918K (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI SALIL MISHRA, SR. DR. RESPONDENT BY : NONE. O R D E R PER BENCH ALL THESE SIX APPEALS, FILED BY THE REVENUE, ARE DI RECTED AGAINST A COMMON ORDER DATED 28.02.2011 PASSED BY THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) FOR THE ASSESSMENT YEARS 2002- 03 TO 2007-08. 2. THE COMMON AND IDENTICAL GROUND RAISED BY THE RE VENUE IN ALL THESE SIX APPEALS IS AS UNDER:- (I) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E LD. CIT(A) ERRED IN ALLOWING THE DEDUCTION U/S 80IB(10) OF THE INCOME-TAX ACT, 1961 BY DEEMING THAT THE COMPLETION CERTIFICAT E WAS ISSUED BY 31.03.2008. 2 (II), ON THE FACTS AND CIRCUMSTANCES OF THE CASE, T HE LD. CIT(A) ERRED IN COMING TO THE ABOVE CONCLUSION EVEN WHERE THERE IS NO SCOPE IN LAW TO DEEM A DATE OF COMPLETION. 3. WE HAVE HEARD THE LEARNED DEPARTMENTAL REPRESENT ATIVE. NONE FOR THE ASSESSEE WAS PRESENT. NOTICE ISSUED TO THE ASS ESSEE HAS BEEN SERVED THROUGH THE DEPARTMENT AS IS EVIDENT FROM THE SERVI CE REPORT SUBMITTED BY THE ACIT, CIRCLE 27(1), NEW DELHI. WE, THEREFORE, PROCEED TO DISPOSE OF THESE APPEALS AFTER HEARING THE LEARNED DR. 4. THE FACTS RELATING TO THE ISSUE RAISED IN THESE APPEALS HAVE BEEN BRIEFLY STATED BY THE LEARNED CIT(A) IN HIS ORDER AS UNDER: - 2.1 THE APPELLANT, A PARTNERSHIP FIRM, IS A BUILDER AND DEVELOPER. DURING THESE SIX AYS, THE ASSESSEE BUILT RESIDENTIAL UNITS UNDER THE PROJECTS NAMED AS SURNDERA ENCLAVE, SURENDRA VIHAR PHASE-I AND SURNEDRA GARDEN IN BHOPAL, MADHYA PRADESH. PROJECT SURENDRA ENCLAVE WAS SITUATED AT VILLAGE BAWADIA KALAN, BHOPAL. THE PROJECT WAS DEVELOPED ON A LAND AREA OF 1.40 ACRES AFTER GETTING APPROVAL FOR THE PROJECT FROM BHOPAL MUNICIPAL CORPORATION (BMC) VIDES PERMISSION NUMBER 299 DATED 04.09.1999. THIS PROJECT WAS CLAIMED TO HAVE BEEN STARTED IN THE FINANCIAL YEAR (FY) 1999-2000 AND COMPLETED IN THE FY 2002-03 3 AS ALL UNITS OF THE PROJECT WERE SHOWN TO HAVE BEEN SOLD IN THE A.Y. 2002-03 & 2003- 04. PROJECT SURENDRA VIHAR PHASE-I WAS SITUATED AT VILLAGE BAGH MUGALIA, BHOPAL. THE PROJECT WAS DEVELOPED ON A LAND AREA OF 3.50 ACRES AFTER GETTING APPROVAL FOR THE PROJECT FROM BMC VIDES PERMISSION NUMBER 580 DATED 02.11.1999. THIS PROJECT WAS CLAIMED TO HAVE BEEN STARTED IN THE FY 1999- 2000 AND COMPLETED IN THE FY 2003-04 THOUGH UNITS OF THIS PROJECT WERE SHOWN TO HAVE BEEN SOLD MAINLY IN THE AY 2002-03, 2003-04, 2004-05 AND FEW IN 2007-08. THE ASSESSEE STARTED THESE ABOVE MENTIONED TWO PROJECTS DURING THE AY 2000-01 BUT FILED ITS FIRST RETURN FOR THESE PROJECTS FOR THE AY 2002-03 CLAIMING THE DEDUCTION U/S 80IB(10) FOR THE FIRST TIME, WHICH WAS ALLOWED BY THE ORDER PASSED U/S 143(3) OF THE ACT. LATER ON, FOR AY 2003-04 AND 2004- 05, THE DEDUCTION U/S 80IB(10) WAS ALSO ALLOWED BY THE ORDERS PASSED UNDER SECTION 143(3) OF THE ACT. 2.1.1 THE PROJECT SURENDRA GARDEN WAS SITUATED AT VILLAGE AHMEDPUR KALAN, HOSHANGABAD ROAD, BHOPAL. THIS PROJECT WAS DEVELOPED ON A LAND AREA OF 6.00 ACRES 4 AFTER GETTING APPROVAL FOR THE PROJECT FROM BMC VIDE PERMISSION NUMBER 3737 DATED 27.03.2001. THIS PROJECT WAS CLAIMED TO HAVE BEEN STARTED IN THE FY 2000-01 AND COMPLETED IN THE FY 2005-06 AS ALL UNITS OF THIS PROJECT WERE SOLD IN THE AY 2002-03, 2003-04, 2004-05 TO 2007-08. THE ASSESSEE STARTED THIS PROJECT DURING THE AY 2000-01 BUT SHOWED INCOME DERIVED FROM THIS PROJECT FOR THE FIRST TIME IN AY 2004-05 AND CLAIMED DEDUCTION U/S 80IB(10), WHICH WAS ALLOWED BY THE ORDER PASSED U/S 143(3) OF THE ACT. THE DEDUCTION U/S 80IB(10) ON THIS PROJECT FOR AY 2005-06 WAS ALSO ALLOWED U/S 143(1) OF THE ACT. THE TOTAL AREA OF THESE THREE PROJECTS, INDEPENDENTLY, ARE MORE THAN THE MINIMUM AREA REQUIREMENT U/S 80IB(10) OF THE ACT. 2.1.2 DURING THE COURSE OF SCRUTINY ASSESSMENT PROCEEDINGS FOR AY 2006-07, THE AO NOTED THAT THE LOCAL AUTHORITY HAS NOT ISSUED THE COMPLETION CERTIFICATE FOR THE ABOVE MENTIONED THREE HOUSING PROJECTS OF THE ASSESSEE ON OR BEFORE 31.03.2008, WHICH IS ONE OF THE STATUTORY REQUIREMENTS FOR ALLOWANCE OF THE DEDUCTION U/S 80IB(10) OF THE ACT. THEREFORE, THE AO CONCLUDED THAT 5 THE REQUIREMENT OF COMPLETION OF CONSTRUCTION BEFORE 31.03.2008 AS PER PROVISIONS OF SEC. 80IB(10)(A)(I) HAD NOT BEEN MET BY THE ASSESSEE NOT ONLY IN THE AY 2006-07 AND INITIATED PROCEEDINGS U/S 147/148 OF THE ACT FOR AY 2002-03 TO 2005- 06. LATER ON THE CASE OF ASSESSEE FOR AY 2007-08 WAS ALSO COMPLETED UNDER SCRUTINY DISALLOWING THE DEDUCTION U/S 80IB(10) OF THE ACT. THE AO CONCLUDED THE RE- ASSESSMENT PROCEEDINGS FOR AY 2002-03 TO 2005-06, VIDE THE IMPUGNED ORDERS THEREBY DENYING THE DEDUCTION U/S 80IB OF THE ACT THOUGH THE SAME WAS ALLOWED IN THE ORIGINAL ASSESSMENT U/S 143(3)/143(1) OF THE ACT. 5. THE ISSUE INVOLVED IS WITH REGARD TO THE QUESTIO N AS TO WHETHER THE AO WAS JUSTIFIED IN DISALLOWING THE CLAIM OF DEDUCTION UNDER SEC. 80IB(10) OF THE ACT FOR THE REASON THAT THE COMPLETION CERTIFIC ATE FROM THE LOCAL AUTHORITY HAS NOT BEEN OBTAINED WITHIN THE TIME PRESCRIBED UN DER SEC.80-IB(10) OF THE ACT. 6. THE LD. DR HAS SUBMITTED THAT SINCE THE COMPLETI ON CERTIFICATE HAS BEEN ISSUED BY THE MUNICIPAL AUTHORITY ON 18.06.201 0, 23.06.2010 AND 24.06.2010 IN RESPECT OF THREE HOUSING PROJECTS RES PECTIVELY, THE DATE OF 6 COMPLETION OF CONSTRUCTION OF THE HOUSING PROJECT S HALL BE TAKEN TO BE THE DATE ON WHICH THE COMPLETION CERTIFICATE IS ISSUED BY THE MUNICIPAL AUTHORITY. HE, THEREFORE, SUBMITTED THAT COMPLETIO N OF CONSTRUCTION CANNOT BE TAKEN BEFORE 31.03.2008, BY WHICH DATE THE ASSES SEE WAS REQUIRED TO OBTAIN COMPLETION CERTIFICATE FROM THE AUTHORITY TO CLAIM DEDUCTION U/S 80IB(10) OF THE ACT. THE LEARNED DR BEFORE US HAS MERELY RELIED UPON THE AOS ORDER AND SUBMITTED THAT SINCE THE COMPLETION CERTIFICATE ISSUED BY THE LOCAL AUTHORITY WAS BEYOND THE PRESCRIBED PERIOD, T HE ASSESSEE WAS NOT ENTITLED TO DEDUCTION UNDER SEC.80-IB(10) OF THE AC T. 7. THE LEARNED CIT(A) HAS DECIDED THIS ISSUE BY CON SIDERING VARIOUS FACTS OF THE CASE AND AFTER ANALYZING PROVISIONS OF LAW CONTAINED IN THAT BEHALF AND HAS, THUS, HELD THAT IN THE FACTS AND CI RCUMSTANCES OF THE CASE, THE ASSESSEE IS ENTITLED TO A DEDUCTION UNDER SEC. 80-I B(10) INASMUCH AS THE NECESSARY CONDITION FOR OBTAINING COMPLETION CERTIF ICATE HAS BEEN COMPLIED WITH BY THE ASSESSEE BY THE SPECIFIED DATE, I.E., 3 1.03.2008. THE RELEVANT PORTION OF THE LEARNED CIT(A)S ORDER IS AS UNDER:- 5.4 I HAVE ANALYZED THE LEGISLATIVE HISTORY OF TH E SEC. 80IB(10) OF THE ACT AND COME TO THE CONCLUSION THAT THE LEGISLATIVE INTENTION BEHIND THIS SUB SECTION IS TO PROMOTE THE HOUSING PROJECTS WITHIN THE DEVELOPMENTAL PLAN APPROVED BY THE LOCAL 7 BODY. THEREFORE, THE FACTS OF THIS CASE HAVE TO BE ANALYZED IN THAT PERSPECTIVE. THIS IS EVIDENT FROM THE MEMORANDUM EXPLAINING PROVISIONS IN FINANCE (NO.2) BILL, 2004, WHICH READS AS UNDER: IT IS PROPOSED TO SUBSTITUTE THE EXISTING SUB-SECTION SO AS TO RATIONALIZE THE PROVISIONS AND PROVIDE ADDITIONAL INCENTIVES. WITH A VIEW TO ALLOW MORE HOUSING PROJECT TO AVAIL OF THE TAX HOLIDAY UNDER THIS PROVISION, IT IS PROPOSED TO EXTEND THE TIME LIMIT FOR OBTAINING APPROVAL FROM THE LOCAL AUTHORITY TO 31 ST MARCH, 2007. HOWEVER, IT IS ALSO PROPOSED TO PROVIDE A TIME LIMIT FOR THE COMPLETION OF THE HOUSING PROJECTS WITHIN FOUR YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE PROJECT IS APPROVED BY THE LOCAL AUTHORITY. IT IS PROPOSED TO TAKE THE DATE OF APPROVAL AS THE DATE ON WHICH THE BUILDING PLAN IS FIRST APPROVED BY THE LOCAL AUTHORITY AND THE DATE OF COMPLETION OF THE HOUSING PROJECT AS THE DATE ON WHICH COMPLETION CERTIFICATE IS ISSUED BY SUCH AUTHORITY. 8 IT IS FURTHER PROPOSED TO PROVIDE THAT BUILT UP AREA OF THE SHOPS AND OTHER COMMERCIAL ESTABLISHMENTS INCLUDED IN THE HOUSING PROJECT SHALL NOT EXCEED FIVE PER CENT OF THE AGGREGATE BUILT UP AREA OF THE HOUSING PROJECT OR 2000 SQ. FT. WHICHEVER IS LESS. WITH A VIEW TO ENCOURAGE THE REDEVELOPMENT OF SLUM DWELLINGS, IT IS PROPOSED TO RELAX THE CONDITION OF MINIMUM PLOT SIZE OF ONE ACRE IN THE CASE OF A HOUSING PROJECT, CARRIED OUT IN ACCORDANCE WITH A SCHEME FRAMED BY THE CENTRAL GOVERNMENT OR A STATE GOVERNMENT FOR A RE-CONSTRUCTION OR REDEVELOPMENT OF EXISTING BUILDINGS AND NOTIFIED BY THE BOARD IN THIS BEHALF. IT IS ALSO PROPOSED TO DEFINE THE EXPRESSION BUILT UP AREA TO MEAN THE INNER MEASUREMENTS OF RESIDENTIAL UNIT AT THE FLOOR LEVEL INCLUDING THE PROJECTIONS AND BALCONIES, AS INCREASE BY THE THICKNESS OF THE WALLS BUT NOT INCLUDING THE COMMON AREA SHARED WITH OTHER RESIDENTIAL UNITS. 9 5.5 THE AMENDMENT BRINGING THE TIME LIMIT FOR COMPLETION, HERE IN THE CASE OF THE APPELLANT AS 31.03.2008 CANNOT BE SAID TO HAVE BEEN BROUGHT WITH RETROSPECTIVE EFFECT AS IT PROVIDES MINIMUM 4 YEARS TIME TO COMPLETE THE PROJECTS SANCTIONED PRIOR TO THE AMENDMENT. HENCE ALL THE CASE LAWS RELIED UPON BY THE AR ARE OF NO HELP AS THESE ARE DISTINGUISHABLE ON FACTS. HERE, THE UNDISPUTED FACTS ARE THAT THE APPELLANT FULFILLS ALL THE TERMS AND CONDITIONS REQUIRED FOR THE DEDUCTION U/S 80IB(10) FOR ALL THREE PROJECTS NAMED AS SURENDRA ENCLAVE, SURENDRA VIHAR PHASE-I AND SURENDRA GARDEN EXCEPT THE FACT THAT THE MUNICIPAL CORPORATION HAS NOT ISSUED THE COMPLETION CERTIFICATES FOR THESE HOUSING PROJECTS ON OR BEFORE 31.03.2008 THOUGH THE APPLICATIONS FOR ISSUANCE OF CERTIFICATES HAVE BEEN RECEIVED BY BMC ON 26.11.2007. THE APPELLANT HAS FILED VARIOUS EVIDENCES TO PROVE ITS CLAIM THAT ITS PROJECT WERE COMPLETED BEFORE 31.03.2008. BUT NONE OF THESE PARAMETERS CAN OVER RIDE THE STATUTORY REQUIREMENT, I.E. THE COMPLETION CERTIFICATE ISSUED BY THE CORPORATION THOUGH IT CAN SUPPLEMENT IT. ALL THESE EVIDENCES, BEING 10 SECONDARY EVIDENCES, SIMPLY PROVE THAT THE RESIDENTIAL UNITS OF SURENDRA ENCLAVE, SURENDRA VIHAR PHASE-I AND SURENDRA GARDEN HAVE BEEN CONSTRUCTED AND SOLD MUCH PRIOR TO 31.03.2008 BUT ALL THESE CANNOT CERTIFY THAT WHETHER THESE HOUSING PROJECTS AS SUCH HAVE BEEN COMPLETED AS PER TERMS AND CONDITIONS SANCTIONED BY THE CORPORATION. WHETHER VARIOUS PARAMETERS/GUIDELINES SPECIFIED BY THE CORPORATION ARE FULFILLED OR NOT CANNOT BE VERIFIED AND CERTIFIED BY ANY OTHER AUTHORITY, OTHER THAN THE CORPORATION WHICH HAS SANCTIONED THESE PROJECTS. AS PER THE SUBMISSION OF THE AR MENTIONED ABOVE AND FACTS MENTIONED IN THE IMPUGNED ORDERS FOR AY 2002-03 TO 2007-08, IT IS AN UNDISPUTED FACT THAT THE APPELLANT HAS APPLIED FOR COMPLETION CERTIFICATE ON 26.11.2007 BUT THE CORPORATION HAS NOT ISSUED THE CERTIFICATE ON OR BEFORE 31.03.2008. HOWEVER, THE CORPORATION HAS ISSUED THE CERTIFICATES ON 18.06.2010, 23.06.2010 AND 24.06.2010 IN RESPECT OF PERMISSION NOS. 3737/27.03.2001, 299/04.09.1999 AND 580/02.11.1999 RESPECTIVELY. 11 5.6 THE COMPLETION CERTIFICATES OF THE ABOVE THREE PROJECTS WERE SENT TO THE AO WITH CERTAIN DIRECTIONS TO CONDUCT ENQUIRIES. THE AOS REPORT DATED 08.02.2011, WHICH IS SELF EXPLANATORY, IS REPRODUCED AS UNDER: 2. REGARDING QUERY CONTAINED IN PARA (I) OF YOUR LETTER, ENQUIRY HAS BEEN MADE FROM THE CITY PLANNER,BHOPAL MUNICIPAL CORPORATION. IN THIS REGARD, A COPY OF THE REPLY DATED 10.01.2011 RECEIVED FROM THE CITY PLANNER ON 17.01.2011 IS ENCLOSED HEREWITH, WHICH IS SELF-EXPLANATORY. IT IS REPORTED THAT- (A)THE ASSESSEE SUBMITTED APPLICATION FOR COMPLETION CERTIFICATE W.R.T. ITS HOUSING PROJECTS ON 26.11.2007. (B)AT THE TIME OF APPLICATION, M/S GIRIJA COLONIZERS HAD COMPLIED WITH ALL THE FORMALITIES. (C) THE MUNICIPAL CORPORATION HAS TO CARRY OUT INSPECTION OF ALL THE CONSTRUCTED UNITS BEFORE ISSUING COMPLETION CERTIFICATE. THE APPLICANT M/S GIRIJA COLONIZERS HAD GIVEN POSSESSION OF MOST OF THE 12 UNITS BEFORE SUBMITTING THE APPLICATION FOR COMPLETION CERTIFICATE. AS A RESULT, IT TOOK TIME FOR INSPECTION. 3. REGARDING QUERY CONTAINED IN PARA (II) OF YOUR LETTER, THE ASSESSEE HAS SUBMITTED REPLY ON 11.01.2011. COPY OF THE SAME IS ENCLOSED WHICH IS SELF-EXPLANATORY. IT HAS BEEN SUBMITTED THAT THE SISTER CONCERN M/S SURENDERA DEVELOPERS WAS INCORPORATED ON 01.04.2003. HENCE, INFORMATION WITH REGARD TO AYS 2002-03 AND 2003-04 IS NOT APPLICABLE. IN R/O AYS 2005-06 & 2007-08, THE TRANSACTIONS OF THE ASSESSEE WITH ITS SISTER CONCERN M/S SURENDRA DEVELOPERS COMPRISES OF PAYMENTS WHICH ARE NOT IN THE NATURE OF EXPENDITURE. HENCE, THE PROVISIONS OF TDS ARE NOT APPLICABLE. COPIES OF THE ACCOUNT EXTRACTS OF M/S SURENDRA DEVELOPERS IN THE BOOKS OF THE ASSESSEE FOR THE RELEVANT ASST. YEARS HAVE BEEN SUBMITTED WHICH 13 ARE ALSO ENCLOSED HEREWITH. FROM THE SAME, IT IS SEEN THAT THERE ARE NO CREDITS TO THE ACCOUNT OF M/S SURENDRA DEVELOPERS ON ACCOUNT OF ANY BILLS RAISED WHICH WOULD INDICATE EXPENDITURE ON THE PART OF THE ASSESSEE. AT THE END OF THE YEAR, THE PAYMENTS MADE BY THE ASSESSEE TO, OR ON BEHALF OF M/S SURENDRA DEVELOPERS ARE SHOWN AS DEBIT BALANCE OF M/S SURENDRA DEVELOPERS TOWARDS THE ASSESSEE. 4. REGARDING QUERY CONTAINED IN PARA (III) OF YOUR LETTER, VIZ. WHETHER ALL THE RESIDENTIAL UNITS ARE LESSER THAN 1500 SQ. FEE AND WHETHER THE ASSESSEE FULFILLED ALL THE TERMS AND CONDITIONS OF SEC. 80IB(10), IT IS SEEN FROM THE RECORDS THAT DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS, THE THEN AO HAS INQUIRED INTO THESE ASPECTS. IT WAS CONCLUDED BY THE AO THAT THE RESIDENTIAL UNITS ARE LESSER THAN 1500 SQ. FEE. PROCEEDINGS U/S 147 WERE INITIATED FOR THE REASON THAT IT WAS FOUND DURING THE ASSESSMENT 14 PROCEEDINGS FOR AY 2006-07 THAT THE ASSESSEE HAD NOT BEEN ISSUED THE REQUISITE COMPLETION CERTIFICATE AND HENCE, THE DEDUCTION CLAIMED U/S 80IB(10) IS NOT ALLOWABLE BECAUSE THE REQUIREMENT OF SEC. 80IB(10) WAS NOT SATISFIED. UNDER THE CIRCUMSTANCES, DECISION MAY KINDLY BE TAKEN ON MERITS. 5.7 IT IS SPECIFIED IN SECTION 301 OF MADHYA PRADES H NAGAR PALIKA ADHINIYAM THAT EVERY PERSON WHO CONSTRUCTS ANY BUILDING SHALL WITH IN ONE MONTH OF COMPLETION OF CONSTRUCTION DELIVER TO THE COMMISSIONER A NOTICE IN WRITING OF SUCH COMPLETION AND SHALL PROVIDE ALL THE FACILITIES TO THE COMMISSIONER FOR THE INSPECTION OF THE WORK COMPLETED. WITHIN SEVEN DAYS OF THE RECEIPT OF SUCH NOTICE, THE COMMISSIONER SHALL DEPUTE AN OFFICER TO COMMENCE THE INSPECTION OF THE SAID CONSTRUCTION. WITHIN SEVEN DAYS FROM THE DATE OF THE COMMENCEMENT OF SUCH INSPECTION THE COMMISSIONER SHALL 1. GIVE PERMISSION FOR THE OCCUPATION OF THE BUILDING ERECTED OR FOR THE USE OF THE PART OF THE BUILDING; OR 2. REFUSE SUCH PERMISSION IN CASE SUCH ERECTION, CONSTRUCTION IN CONTRAVENTION 15 OF ANY PROVISIONS OF THIS ACT OR ANY RULE OR ANY BY LAW MADE THERE UNDER OR ANY OTHER ENACTMENT FOR THE TIME BEING IN FORCE. FURTHER, NO PERSON SHALL OCCUPY OR PERMIT TO BE OCCUPIED ANY SUCH BUILDING OR USE OF PERMIT TO BE USED 1. UNTIL THE PERMISSION REFERRED TO IN CLAUSE (A) OF SUB-SECTION (3) HAS BEEN GRANTED IN THE MANNER PRESCRIBED BY BYE LAWS; 2. UNLESS THE COMMISSIONER HAS FAILED TO FIFTEEN DAYS AFTER THE RECEIPT OF NOTICE OF COMPLETION TO INTIMATE HIS REFUSAL TO GRANT THE SAID PERMISSION. 5.8 HERE THE APPELLANT HAS COMPLETED THE CONSTRUCTI ON MUCH PRIOR TO 31.03.2008 AS EVIDENT FROM MATERIAL AVAILABLE ON THE RECORDS AND THE AOS REMAND REPORT DATED 08.02.2011. THE BMC, VIDE ITS LETTER DATED 10.01.2011 ADDRESSED TO THE AO HAS ADMITTED THAT THE APPELLANT, WHILE FILING APPLICATIONS ON 26.11.2007, HAD FULFILLED ALL REQUIREMENTS/FORMALITIES OF THE COMPLETION CERTIFICATES AS NOTIFIED BY THE CORPORATION. THUS, IT CAN BE INFERRED THAT THESE HOUSING PROJECTS AS SUCH HAVE BEEN COMPLETED AS PER TERMS AND CONDITIONS SANCTIONED BY THE CORPORATION AS VARIOUS PARAMETERS/GUIDELINES SPECIFIED BY THE 16 CORPORATION ARE FULFILLED AND VERIFIED AND CERTIFIE D BY BMC WHO HAS SANCTIONED THESE PROJECTS. IT IS ALSO AN UNDISPUTED FACT THAT STATES OF ALL RESIDENT IAL UNITS OF SURENDRA ENCLAVE, SURENDRA VIHAR PHASE-I AND SURENDRA GARDEN HAVE BEEN MATERIALIZED ON OR BEFORE 31.03.2008 AS NO POSSESSION OF ANY RESIDENTIAL UNIT BELONGING TO THESE PROJECTS WAS GIVEN BY THE APPELLANT AFTER 31.03.2008. THE OTHER EVIDENCES SUBMITTED BY THE APPELLANT ALSO ESTABLISH THIS FACT. THESE ARE AS UNDER: 1. AS PER POSSESSION CERTIFICATES GIVEN BY THE BUYERS/CUSTOMERS, IT IS EVIDENT THAT ALL RESIDENTIAL UNITS IN THESE PROJECTS WERE COMPLETED AND SOLD MUCH BEFORE THAN 31.03.2008. 2. THE ARCHITECTS CERTIFICATES STATING THAT THE ABOVE MENTIONED HOUSING PROJECTS OF THE ASSESSEE WERE COMPLETED IN ALL RESPECT ON OR BEFORE 31.03.2008. 3. THE PROPERTY TAXES OF ALL UNITS ARE BEING PAID BY THE RESPECTIVE BUYERS/RESIDENTS FROM THE DATE OF REGISTRATION OF THE SALE DEEDS, WHICH ARE ALSO BEFORE 31.03.2008. 17 4. THE PERMANENT ELECTRICITY CONNECTIONS HAD BEEN GIVEN BY MPEB IN THE NAME OF RESPECTIVE BUYERS BEFORE 31.03.2008. 5.9 THE AO HAS NOT DISPUTED THE FACT THAT THE APPEL LANT HAS NOT FULFILLED THE REQUIREMENTS OF SEC. 80IB AND NOT APPLIED FOR COMPLETION CERTIFICATES ON 26.11.2007. HERE, THE APPELLANT COULD NOT BE HELD RESPONSIBLE FOR NON ISSUANCE OF THE COMPLETION CERTIFICATES BY THE LOCAL AUTHORITY ESPECIALLY WHEN IT FULFILLED ALL REQUIREMENTS/FORMALITIES OF THE COMPLETION CERTIFICATES AS NOTIFIED BY THE CORPORATION, WHILE FILING APPLICATIONS ON 26.11.2007. NON ISSUANCE OF COMPLETION CERTIFICATES, EVEN AFTER FULFILLING ALL REQUIREMENT S BY THE APPELLANT AS DISCUSSED ABOVE AND ADMITTED BY THE BMC, IS INDIRECTLY DICTATING THE AO FOR DISALLOWABILITY OF DEDUCTION U/S 80IB(10) OF THE ACT. THIS CANNOT BE THE INTENTION OF THE LEGISLATU RE. THE INTENTION MAY BE THAT THE BUILDERS AND DEVELOPERS SHOULD FULFILL ALL GUIDELINES OF CORPORATION BEFORE SELLING THE RESIDENTIAL UNITS. HERE, THE APPELLANT IS NOT THE ISSUING AUTHORITY OF COMPLETION CERTIFICATE. HENCE, THE APPELLANT IS NO T RESPONSIBLE FOR NOT GETTING COMPLETION CERTIFICATES ISSUED BY THE BMC. THE ASSESSEE COULD NOT BE PUNISHED FOR SUCH ACT WHICH IS BEYOND ITS CONTROL. IMPOSSIBLE CANNOT BE REQUIRED TO BE PERFORMED BY 18 A PERSON ESPECIALLY WHEN SUCH THING IS BEYOND HIS CONTROL. THE DOCUMENTS MENTIONED ABOVE ESTABLISH THAT THE APPELLANT HAD COMPLETED THE CONSTRUCTION OF THE ABOVE MENTIONED THREE PROJECTS BEFORE 31.03.2008 AND THE APPELLANT HAD ALSO APPLIED FOR THE COMPLETION CERTIFICATES ON 26.11.2007 FOR THESE THREE PROJECTS, BUT IT COULD NOT GET IT WITHIN THE STATUTORY TIME PRESCRIBED IN REQUIREMENTS/GUIDELINES/FORMALITIES OF THE COMPLETION CERTIFICATES AS ISSUED/NOTIFIED BY THE CORPORATION. THE WORD ISSUED HAS BEEN USED IN THE I.T. ACT FOR THE COMPLETION CERTIFICATE AND NOT THE WORD OBTAINED BY THE ASSESSEE. AS THE LEGISLATURE HAD ALREADY ANTICIPATED SUCH HARDSHIPS OF THE ASSESSEE AND THAT IS WHY THE WORD ISSUED BY THE CORPORATION HAS BEEN USED. IN THIS CASE THERE IS NO REFUSAL FOR ISSUANCE OF THE COMPLETION CERTIFICATE BY THE COMMISSIONER OF MUNICIPAL CORPORATION TILL 31.03.2008 AND BMC, VIDE ITS LETTER DATED 10.01.2011 ADDRESSED TO THE AO HAS ALSO ADMITTED THAT THE APPELLANT, WHILE FILING APPLICATIONS ON 26.11.2007, HAD FULFILLED AL L REQUIREMENTS/GUIDELINES/FORMALITIES OF THE COMPLETION CERTIFICATES AS ISSUED/NOTIFIED BY THE CORPORATION, THEREFORE, IT IS HERE BY HELD THAT THESE THREE HOUSING PROJECTS OF THE APPELLANT ARE DEEMED TO HAVE BEEN COMPLETED AND COMPLETION 19 CERTIFICATES ARE DEEMED TO HAVE BEEN ISSUED BY 31.03.2008, KEEPING IN VIEW (I) THE SUBMISSION OF THE AR, (II) ABSENCE OF ANY CONTRARY MATERIAL BROUGHT ON THE RECORDS BY THE AO AND (III) PROVISIONS OF SEC. 301(4) OF THE MADHYA PRADESH NAGAR PALIKA NIGAM ADHINIYAM. THIS INFERENCE ALSO GETS BUTTRESSED BY THE FACT THAT, THE CORPORATION HAD ISSUED THE COMPLETION CERTIFICATES OF THESE THREE PROJECTS ON 18.06.2010, 23.06.2010 AND 24.06.2010 IN RESPECT OF PERMISSION NO. 3737/27.03.2001, 299/04.09.1999 AND 580/02.11.1999 RESPECTIVELY. 5.10 HERE, THERE IS NO DISPUTE REGARDING THE APPELL ANT COMPLYING WITH THE ELIGIBILITY CONDITIONS REQUIRED FOR CLAIMING DEDUCTION U/S 80IB(10 AND THE ONLY CONTENTION OF THE AO FOR REJECTING THE CLAIM OF APPELLANT FOR ALL THESE SIX AYS IS THAT THERE IS NO COMPLETION CERTIFICATES IN RESPECT OF ABOVE MENTIONED THREE HOUSING PROJECTS ISSUED BY THE CORPORATION. TAKING INTO ACCOUNT THE FACT THAT THE AO HAS NOT DISPUTED THE ELIGIBILITY OF THE APPELLAN T FOR CLAIMING THE DEDUCTION AND FURTHER IN VIEW OF THE FACT THAT THERE IS DEEMING COMPLETION CERTIFICATES ISSUED BY THE CORPORATION AS DISCUSSED ABOVE, IT IS HERE BY HELD THAT THE APPELLANT IS ENTITLED TO DEDUCTION U/S 80IB(10) FOR AYS 2002-03 TO 2007-08. HERE, THE NOTEWORTHY FACT IS THAT THE 20 APPELLANT HAS ALSO ALLOWED POSSESSION OF THE RESIDENTIAL UNIT TO BUYERS MUCH BEFORE ITS APPLICATION FOR COMPLETION CERTIFICATE ON 26.11.2007, WHICH IS ALSO CONTRARY TO THE PROVISIONS OF SEC. 301 OF THE MADHYA PRADESH NAGAR PALIKA NIGAM ADHINIYAM. HOWEVER, NO ACTION HAS BEEN CLAIMED TO HAVE BEEN TAKEN BY BMC FOR THIS VIOLATION. HOWEVER, NO DISALLOWANCE ON THIS SCORE CAN BE MADE U/S 37 OF THE ACT AS THE EXPENSES ARE NOT AN OFFENCE OR PUNISHABLE AT THE TIME OF ITS INCURRENCE. THE SUBSEQUENT ACT THEREFORE, CANNOT DETERMINE ITS ALLOWABILITY AND DISALLOWABILITY UNDER THE ACT. ALTERNATIVELY ALSO, ANY DISALLOWANCE RESULTING ENHANCEMENT IN THE BUSINESS INCOME FROM THE AFORESAID HOUSING PROJECTS OF THE APPELLANT, IN RESULT, WILL ENHANCE THE QUANTUM OF DEDUCTION U/S 80IB(10) OF THE ACT AND THUS NET EFFECT THEREOF GETS NEUTRALIZED. THE GROUNDS NUMBER 5 & 6 FOR AY 2002-03, GROUNDS OF APPEAL NUMBERED 3 & 4 FOR AYS 2003-04 TO 2005- 06 AND GROUNDS OF APPEAL NUMBERED 1 TO 3 FOR AY 2006-07 & 2007-08 ARE THEREFORE, ALLOWED. THE AO IS THEREFORE, DIRECTED TO ALLOW THE CLAIM OF DEDUCTION U/S 80IB(10) OF THE ACT IN ALL SIX AYS UNDER REFERENCE, I.E. AYS 2002-03 TO 2007-08. ACCORDINGLY, THE APPELLANT GETS CONSEQUENTIAL RELIEF IN ALL THESE SIX AYS. 21 8. IN SUPPORT OF THE VIEW TAKEN BY THE LEARNED CIT( A), A REFERENCE MAY BE MADE TO A DECISION OF COORDINATE BENCH OF ITAT P UNE BENCH B IN THE CASE HINDUSTAN SAMUHA AWAS LTD. VS. ITO IN ITA NOS. 945 TO 950/PN/2010, DATED 30.08.2011, WHERE SOME EARLIER DECISIONS OF T HE TRIBUNAL ON IDENTICAL ISSUE HAVE BEEN FOLLOWED. THE RELEVANT PORTION OF THE TRIBUNALS ORDER IN THE ABOVE REFERRED CASE IS AS UNDER:- 7. WE HAVE CONSIDERED THE ABOVE VIEW POINTS OF TH E PARTIES IN DISPUTED. WE FIND THAT IT IS A FACT THA T THE ASSESSEE THROUGH ITS ARCHITECT HAD FILED APPLICATION WITH THE AMC FOR ISSUANCE OF OCCUPANCY CERTIFICATE ON 25.03.2008. REQUISITE FEE WAS ALSO PAID BY THE ASSESSEE IN THIS REGARD. AMC DID NOT RAISE ANY OBJECTION TO THE SAID COMPLETION CERTIFICATE OF THE ARCHITECT. THE OCCUPANCY CERTIFICATE DT. 10.10.2008 HAS BEEN ISSUED BY THE AMC ONLY ON THE BASIS OF THE SAID APPLICATION DT. 25.03.2008. IT IS ALSO AN UNDISPUTED FACT THAT ISSUANCE OF OCCUPANCY CERTIFICATE IS THE PREROGATIVE OF THE LOCAL AUTHORITY I.E. AMC AND IN THIS REGARD, THE ASSESSEE HAS NO CONTROL AND IT IS BEYOND THE POWER OF THE ASSESSEE TO MAKE THE AMC ISSUE THE SAID COMPLETION/OCCUPANCY CERTIFICATE BEFORE 31.03.2008. WHAT WAS UNDER THE POWER AND CONTROL OF THE ASSESSEE WAS ONLY TO MOVE THE AMC FOR COMPLETION CERTIFICATE FULFILLING ALL THE 22 REQUIREMENTS WITH THE AMC FOR ISSUANCE OF OCCUPANCY CERTIFICATE, WHICH THE ASSESSEE HAS DONE IN THE PRESENT CASE. THUS, THE DELAY IN ISSUING TH E OCCUPANCY CERTIFICATE CANNOT BE ATTRIBUTED ON THE PART OF THE ASSESSEE TO DENY THE CLAIMED DEDUCTION U/S 80IB(10) OF THE ACT ON THE BASIS THAT THE PROJE CT WAS NOT COMPLETED BY 31.03.2008, ESPECIALLY WHEN THERE IS NO OBJECTION RAISED BY THE AMC REGARDING DEVIATION IN THE CONSTRUCTION OF THE PROJECT APPROVED BY THE AMC. 8. WE HAVE GONE THROUGH THE ORDERS CITED BY THE ASSESSEES REPRESENTATIVE AND FIND RELEVANT PARAGRAPHS ARE REQUIRED TO BE EXTRACTED FOR COMPLETION OF THE ORDER. THEY ARE AS FOLLOWS: A. EXTRACT FROM THE DECISION OF THE TRIBUNAL IN THE CASE OF M/S SATISH BORA & ASSOCIATES VIDE ITA NOS. 713 & 714/PN/2010 19. ..... 1. IN THE CASE OF PMC, THE COMPLETION CERTIFICATE IN PRESCRIBED FORM ISSUED BY THE LICENSED ARCHITECT ETC. WHO HAS SUPERVISED THE CONSTRUCTION IS FURNISHED WITH FOUR SETS OF COMPLETION PLAN UNDER RULE 7.6 OF THE DC 23 RULES OF THE PMC. THEREAFTER PMC IS REQUIRED TO RETURN ONE OF THE SETS DULY CERTIFIED AS COMPLETION PLAN TO THE OWNER ALONGWITH THE ISSUE OF FULL OCCUPANCY CERTIFICATE AFTER INSPECTION OF THE WORK UNDER RULE 7.7 OF THE DC RULES. SINCE EXPLANATION (II) TO SECTION 80IB(10)(A) OF THE I.T. ACT REQUIRES COMPLETION CERTIFICATE ISSUED BY THE LOCAL AUTHORITY TO BE TAKEN AS THE DATE OF COMPLETION OF THE CONSTRUCTION, A GENERAL UNDERSTANDING IN OUR VIEW IS THAT A COMPLETION CERTIFICATE WHICH IS ISSUED BY THE LOCAL AUTHORITY AFTER CONDUCTING INSPECTIONS OF CONSTRUCTION BY IT. IN CASE OF PMC, IT IS ONLY OCCUPANCY CERTIFICATE WHICH IS ISSUED ALONG WITH CERTIFIED COMPLETION PLAN AFTER INSPECTION OF THE CONSTRUCTION BY IT, WE HAVE TREATED THE DATE OF ISSUANCE OF SUCH 24 OCCUPANCY CERTIFICATE ALONG WITH CERTIFIED COMPLETION PLAN AS THE DATE OF COMPLETION CERTIFICATE OF THE CONSTRUCTION FOR THE REQUIREMENT OF EXPLANATION (II) TO SECTION 80IB(10)(A) OF THE I.T. ACT. 2. SINCE IN FACT PMC DO NOT ISSUE OCCUPANCY CERTIFICATE GENERALLY IN TIME AND WITH THIS UNDERSTANDING THE LEGISLATURE HAVE ALSO INTRODUCED A DEEMING PROVISION OF 21 DAYS TO PUT CONSTRAINT UPON PMC, WE AFTER DETAILED DELIBERATION IN PRECEDING PARAGRAPHS HAVE COME TO A CONCLUSION THAT IN CASE OF SMALL OBJECTIONS OF PMC RAISED AFTER EXPIRY OF DEEMING PERIOD OF 21 DAYS UNDER RULE 7.7 OF DC RULES UNDER PMC, THE DATE WHEN THE APPLICANT ACQUIRED DEEMING SANCTION WILL BE TREATED AS THE DATE OF COMPLETION (OCCUPANCY) 25 CERTIFICATE TO MEET OUT THE REQUIREMENT OF EXPLANATION (II) TO SECTION 80IB(10)(A) OF THE ACT. WE HAVE ALREADY DISCUSSED HEREINABOVE WHAT WOULD BE THE SMALL OBJECTIONS. IN BRIEF THOSE OBJECTIONS WHICH DO NOT AFFECT THE MAIN PROJECT AND ARE GENERALLY TEMPORARY CONSTRUCTIONS. 20. WE THUS WHILE SETTING ASIDE ORDERS OF THE AUTHORITIES BELOW DIRECT THE AO TO ALLOW THE CLAIMED DEDUCTION U/S 80IB(10) OF THE I.T. ACT, 1961 IN THE ASSESSMENT YEARS UNDER CONSIDERATION TREATING THE REQUIRED DATE OF COMPLETION OF CONSTRUCTION OF THE HOUSING PROJECT AS THE DATE WHEN ABOVE DISCUSSED DEEMING PROVISION PERIOD OF 21 DAYS EXPIRED I.E. 20.11.20. B. EXTRACT THE DECISION OF THE TRIBUNAL IN THE CASE OF SANGHVI & DOSHI ENTERPRISE VIDE ITA NO. 259 TO 263/MDS/2010 26 24. NEXT OBJECTION OF THE AO IS THAT THE PROJECT HAD TO BE COMPLETED ON OR BEFORE 31.03.2008 AND SINCE THE ASSESSEE DID NOT FURNISH THE COMPLETION CERTIFICATE, THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION. THE OBJECTION IS TO THE EFFECT THAT THE COMPLETION CERTIFICATE FROM CMDA IS DATED 13.06.2008, I.E. THREE MONTHS AFTER THE DUE DATE FOR COMPLETING THE PROJECT. IN THIS CONNECTION, IT HAS TO BE NOTED THAT THE COMPLETION CERTIFICATE IS TO BE ISSUED BY THE LOCAL AUTHORITY. THE QUESTION IS, WHETHER CMDA CAN BE CONSIDERED TO BE A LOCAL AUTHORITY OR NOT. THIS ISSUE HAD COME UP BEFORE THE CHENNAI BENCH OF THE TRIBUNAL IN THE CASE OF JAIN HOUSING & CONSTRUCTIONS LTD. IN ITA NO. 1369/MDS/2009 DATED 05.02.2010. IN THAT CASE, ASSESSEE WAS DENIED DEDUCTION IN THE ABSENCE OF COMPLETION CERTIFICATE BY THE CDMA BUT COMPLETION CERTIFICATE ISSUED BY 27 THE CORPORATION OF CHENNAI WAS PLACED ON RECORD. THE TRIBUNAL IN PARAGRAPH 3.5 OF ITS ORDER STATED THAT THE PROJECT LAY OUT PLAN MAY BE REQUIRED TO BE APPROVED BY THE CMDA BUT AS FAR AS THE CONSTRUCTION OF THE BUILDING IS CONCERED, THE LOCAL AUTHORITY, I.E. THE CORPORATION OF CHENNAI IS THE APPROPRIATE AUTHORITY TO REGULATE THE CONSTRUCTION AS PER THE BUILDING BYE-LAWS AND SANCTION PLANS. WHEN IT IS NOT DISPUTED THAT THE CORPORATION IS THE LOCAL AUTHORITY, CERTIFICATE ISSUED BY IT CANNOT BE DISREGARDED. THE ASSESSEE HAS PLACED ON RECORD THE COMPLETION CERTIFICATE ISSUED BY THE CORPORATION BY WAY OF ADDITIONAL EVIDENCE. SINCE THE ALLOWABILITY OF THE ENTIRE DEDUCTION DEPENDS ON ALL THE CONDITIONS BEING FULFILLED DEDUCTION DEPENDS ON ALL THE CONDITIONS BEING FULFILLED, WE ADMIT HIS ADDITIONAL EVIDENCE. 28 THE CERTIFICATE CLEARLY MENTIONS THAT THE BUILDING WAS INSPECTED ON 23.11.2007 AND THAT IT IS FOUND TO BE SATISFIED THE BUILDING PERMIT CONDITIONS. WE MAY ALSO MENTIONS THAT THE ROLE OF CMDA IS QUITE DISTINCT FROM THAT OF THE CORPORATION. CMDA LOOKS AT THE PLANS FROM THE PERSPECTIVE OF THE DEVELOPMENT AND URBANIZATION OF THE CITY AS A WHOLE. ON THE OTHER HAND, THE ROLE OF THE CORPORATION WHILE ISSUING COMPLETION CERTIFICATE IS TO SEE THAT THE UNIT IS HABITABLE IN ALL RESPECTS LIKE CIVIC AMENITIES AND SO ON. EVEN FOR THE SAKE OF ARGUMENT IF THE CMDA CERTIFICATE IS TO BE CONSIDERED, THEN IN THAT CASE, THE ASSESSEE DID APPLY FOR THE COMPLETION CERTIFICATE IS TO SEE THAT THE UNIT IS HABITABLE IN ALL RESPECTS LIKE CIVIC AMENITIES AND SO ON. EVEN FOR THE SAKE OF ARGUMENT IF THE CMDA CERTIFICATE IS TO BE CONSIDERED, THEN IN THAT CASE, THE ASSESSEE DID APPLY FOR 29 THE COMPLETION CERTIFICATE TO CMDA CERTIFICATE ON 13.03.2006. IT IS A DIFFERENT MATTER THAT CMDA RAISED CERTAIN OBJECTIONS AND THE MATTER WENT UPTO THE HONBLE HIGH COURT ALSO. HOWEVER, THE FACT REMAINS THAT THE PROJECT WAS COMPLETED MUCH BEFORE THE DUE DATE, MAY BE WITH CERTAIN DEFECTS. ALSO, IT HAS TO BE NOTED THAT THE CMDA CERTIFICATE IS DATED 13.06.2006, I.E. ONLY TWO MONTHS AND THIRTEEN DAYS BEYOND THE DUE DATE. IT IS INCONCEIVABLE THAT THE TYPE OF DEFECTS WHICH WERE POINTED OUT BY THE CMDA COULD HAVE BEEN RECTIFIED IN SUCH A SHORE PERIOD. BE THAT AS IT MAY, THE HONBLE HIGH COURT ALSO RATIFIED THE DEVIATIONS AND DIRECTED THE CMDA TO CONSIDER THE EXPLANATION OF THE ASSESSEE. ALL THESE FACTS GO TO POINT THAT THE PROJECT WAS INDEED COMPLETED BEFORE THE 31.03.2008. THUS, THIS GROUND ALSO HAS NO FORCE TO DENY 30 THE ASSESSEE THE IMPUGNED DEDUCTION. C. EXTRACT FROM THE DECISION OF THE TRIBUNAL IN THE CASE OF M/S D.K. CONSTRUCTION VIDE ITA 243/IND/2010 7. WE HAVE CONSIDERED THE RIVAL CONTENTIONS, CAREFULLY GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW AND RELEVANT MATERIAL PLACED ON RECORD TOWARDS WHICH OUR ATTENTION WAS INVITED DURING THE COURSE OF HEARING BY THE LD. AR AND THE LD. SR. DR PROVISIONS OF SECTION 80IB ALLOWS CLAIM FOR DEDUCTION IN RESPECT OF HOUSING PROJECT, WHICH HAS BEEN APPROVED PRIOR TO 01.04.2004 AND ALSO COMPLETED BEFORE 31.03.2008. DURING THE COURSE OF ASSESSMENT WITH REGARD TO ASSESSEES CLAIM OF DEDUCTION U/S 80IB IN RESPECT OF ITS D.K. HONEY HOMES PROJECT, THE AO HAS ASKED THE ASSESSEE TO FURNISH THE CERTIFICATE OF COMPLETION OF THIS PROJECT M/S D.K. HONEY HOMES. THE AO 31 ALSO DIRECTLY CALLED INFORMATION FROM THE LOCAL AUTHORITIES BY ISSUING SUMMONS U/S 133(6) AND A LETTER WAS ISSUED BY THE COMPETENT AUTHORITY DATED 11 TH NOVEMBER, 2008, CONFIRMING THAT NO COMPLETION CERTIFICATE HAS BEEN ISSUED BY THIS OFFICE. ACCORDINGLY, THE ASSESSEES CLAIM FOR DEDUCTION U/S 80-IB WAS DECLINED. SECTION 80IB CLEARLY DEFINES THE DATE OF COMPLETION AS DATE OF COMPLETION OF CONSTRUCTION OF THE HOUSING PROJECT SHALL BE TAKEN TO BE THE DATE ON WHICH THE COMPLETION CERTIFICATE IN RESPECT OF SUCH HOUSING PROJECT IS ISSUED BY THE LOCAL AUTHORITIES, IT MEANS LOCAL AUTHORITIES IS COMPETENT TO CERTIFY THE DATE OF COMPLETION OF HOUSING PROJECT. THE DATE OF ISSUE OF SUCH LETTER BY THE LOCAL AUTHORITIES IS NOT SO CRUCIAL BUT IT SHOULD HAVE CLEARLY MENTIONED THE DATE OF COMPLETION OF PROJECT. WHEN THE PROJECT IS COMPLETED ON 32 31.03.2008 AND THE ASSESSEE HAS INFORMED REGARDING SUCH COMPLETION, THE LOCAL AUTHORITIES MAY TAKE ITS OWN TIME FOR ISSUE OF CERTIFICATE, WHICH MAY BE EVEN AFTER 6-7 MONTHS, BUT THE LETTER SO ISSUED BY THE LOCAL AUTHORITIES SHOULD CLEARLY MENTION THE DATE OF COMPLETION OF SUCH PROJECT. MERELY BECAUSE SUCH CERTIFICATE IS ISSUED AFTER GAP OF 8-9 MONTHS OR EVEN ONE YEAR, WILL NOT ADVERSELY AFFECT THE ASSESSEE IF IT HAS MENTIONED CLEARLY THE DATE OF COMPLETION OF PROJECT PRIOR TO 31.03.2008. ONCE THE LETTER FOR COMPLETION OF PROJECT IS GIVEN BY THE ASSESSEE TO THE LOCAL AUTHORITY, IT IS THE DUTY OF THE LOCAL AUTHORITY TO VERIFY PHYSICALLY THE PROJECTS STATED TO BE COMPLETED FROM ITS OWN PARAMETERS. THIS PROCESS MAY TAKE TIME AND, THEREFORE, THE DATE OF ISSUE OF LETTER IS NOT SO CRUCIAL TO DETERMINE THE ASSESSEES ELIGIBILITY FOR CLAIM OF DEDUCTION 33 AS PER EXPLANATION (II) OF SECTION 80IB(10)(A) OF THE INCOME-TAX ACT, 1961. WHAT IS CRUCIAL IS DATE MENTIONED IN THE LETTER SO ISSUED CERTIFYING COMPLETION OF THE PROJECT. THUS, THE DATE OF ISSUE OF LETTER IS NOT IMPORTANT, BUT THE DATE MENTIONED IN THE LETTER CERTIFYING COMPLETION OF PROJECT IS IMPORTANT. WE, THEREFORE, DO NOT FIND MAY MERIT IN THE OBSERVATION OF THE LOWER AUTHORITIES TO THE EFFECT THAT THE DATE OF COMPLETION SHALL BE TAKEN THE DATE ON WHICH CERTIFICATE IS PHYSICALLY ISSUED BY THE LOCAL AUTHORITIES. 9. FROM THE ABOVE, ONE THIS IS CLEAR THAT THE DATE THAT APPEAR ON THE ARCHITECTS COMPLETION CERTIFICATE FILED BEFORE THE LOCAL AUTHORITY IS A RELEVANT ONE. IN THE INSTANT CASE, THE SAID DATE IS 25.03.2008 AN D THE ASSESSEE FILED REQUISITE FORM BEFORE THE LOCAL AUTHORITIES INTIMATING THE COMPLETION OF THE PROJECT. THE SAID CERTIFICATE/INTIMATION WAS ACCEPTED BY THE LOCAL AUTHORITY WITHOUT ANY AMENDMENTS OR OBJECTIONS. LOCAL AUTHORITY HAS NOT RAISED ANY QUERIES ON THE QUALITY CONSTRUCTION 34 OF THE BUILDING OR THE COMPLETION OF THE SAME AS PER THE PLANS APPROVED BY SUCH AUTHORITY. IN SUCH CIRCUMSTANCES, IN OUR OPINION, THE DELAY IN OBTAINING THE COMPLETION CERTIFICATE ON 10.10.2008 IS CERTAINLY NOT ATTRIBUTABLE TO THE ASSESSEE AND OBTAINING THE SAID CERTIFICATE BEFORE 31.03.2008 IS BEYOND THE CONTROL OF THE ASSESSEE. ASSESSEES JO B INCLUDES THE COMPLETION OF THE BUILDING IN ACCORDANCE WITH THE APPROVED PLANS AND INTIMATION OF THE SAME TO THE LOCAL AUTHORITY BY WAY OF FILING THE REQUISITE FORMS TOGETHER WITH THE COMPLETION CERTIFICATE GIVEN BY THE ARCHITECT, THE SPECIALIST IN THE MATTER AND THE ASSESSEE HAS DONE HIS JOB SCRUPULOUSLY IN THIS CASE. HOWEVER, THE LOCAL AUTHORITY HAS NEITHER OBJECTED TO THE SAID APPLICATION OF THE ASSESSEE AND THE ARCHITECT BY RAISING ANY OBJECTIONS NOR ACCEPTED BY ISSUE OF SAID COMPLETION CERTIFICATE TILL 10.10.2008. THEREFORE, THE DELAY IN GRANT OF THE SAID CERTIFICA TE IS CERTAINLY NOT ATTRIBUTABLE TO THE ASSESSEE. THEREFORE, IN OUR OPINION, THE ASSESSEE IS NOT DEFAULTER ON THIS ACCOUNT AND THUS, THE AO HAS ERRED IN DENYING THE DEDUCTION U/S 80IA(10) OF THE ACT. ACCORDINGLY, THE ORDER OF THE CIT(A) HAS TO BE REVERSED. THUS, THE GROUNDS RAISED IN THE APPEAL ARE ALLOWED. 35 9. IN THE PRESENT CASE, THE ASSESSEE VIDE APPLICATI ON DATED 26.11.2007 HAS REQUESTED THE MUNICIPAL CORPORATION FOR ISSUANCE OF COMPLETION CERTIFICATE IN RESPECT OF HOUSING PROJECTS NAMED AS SURENDRA E NCLAVE SURENDRA VIHAR PHASE-I AND SURENDRA GARDEN COMPLETED BY THE ASS ESSEE. THE MUNICIPAL CORPORATION HAD ISSUED THE COMPLETION CERTIFICATE O N 18.06.2010, 23.06.2010 AND 24.06.2010 IN RESPECT OF PERMISSION NO. 3737/27 .03.2001, 299/04.09.1999 AND 580/02.11.1999 RESPECTIVELY. TH E AO IN HIS REMAND REPORT DATED 08.02.2011 HAS STATED THAT AN ENQUIRY WAS MADE FROM THE CITY PLANNER, BHOPAL MUNICIPAL CORPORATION, WHO HAS REPO RTED THAT THE ASSESSEE SUBMITTED APPLICATION FOR COMPLETION CERTIFICATE IN RESPECT OF ITS HOUSING PROJECTS ON 26.11.2007, THE ASSESSEE M/S GIRIJA COL ONISERS HAD COMPLIED WITH ALL THE FORMALITIES AND THE MUNICIPAL CORPORAT ION HAS TO CARRY OUT INSPECTION OF ALL THE CONSTRUCTED UNITS BEFORE ISSU ING COMPLETION CERTIFICATE, AND M/S GIRIJA COLONISERS HAD GIVEN POSSESSION OF M OST OF THE UNITS BEFORE SUBMITTING THE APPLICATION FOR COMPLETION CERTIFICA TE, AS A RESULT OF WHICH IT TOOK TIME FOR INSPECTION. IN THE LIGHT OF THE FACT S NARRATED IN AOS REMAND REPORT AND FACTS AVAILABLE ON RECORD, THE LD. CIT(A ) HAS TAKEN A VIEW THAT THE ASSESSEE HAS COMPLETED THE CONSTRUCTION MUCH PRIOR TO 31.03.2008 AND HAD FULFILLED ALL REQUIREMENTS/FORMALITIES OF THE COMPL ETION CERTIFICATE AS NOTIFIED BY THE CORPORATION AT THE TIME OF FILLING APPLICATI ON FOR ISSUANCE OF 36 COMPLETION CERTIFICATE ON 26.11.2007. THE LD. CIT( A) HAS ALSO RECORDED A FINDING THAT SALES OF ALL RESIDENTIAL UNITS IN RESP ECT OF THREE PROJECTS WERE MATERIALIZED ON OR BEFORE 31.03.2008. THE MUNICIPA L AUTHORITY HAS NOT POINTED OUT ANY DEFECT AND IRREGULARITY IN THE ASSE SSEES APPLICATION DATED 26.11.2007 SUBMITTED FOR ISSUANCE OF COMPLETION CER TIFICATE OF ALL THE SAID PROJECTS. THEREFORE, IN THE LIGHT OF FACTS FOUND B Y THE LD. CIT(A) AND REASONS GIVEN BY HIM, AND RESPECTFULLY FOLLOWING THE AFORES AID DECISION OF ITAT, PUNE BENCH B, PUNE IN THE CASE OF HINDUSTAN SAMUH A AWAS LTD. (SUPRA), WE DO NOT FIND ANY REASON TO TAKE A VIEW OTHER THAN THE VIEW TAKEN BY THE LEARNED CIT(A) IN THE PRESENT CASE. WE, THEREFORE, UPHOLD THE ORDER OF THE LEARNED CIT(A) AND DISMISS ALL THESE APPEALS FILED BY THE REVENUE. 10. IN THE RESULT, ALL THESE APPEALS FILED BY THE R EVENUE ARE DISMISSED. 11. THIS DECISION IS PRONOUNCED IN THE OPEN COURT O N 9 TH DECEMBER, 2011. SD/- SD/- (G.D. AGARWAL) (C.L. SETHI) VICE PRESIDENT JUDICIAL MEMBER DATED: 9 TH DECEMBER, 2011 37 COPY OF THE ORDER FORWARDED TO: 1. APPELLANT. 2. RESPONDENT. 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR, ITAT.