The DCIT, Central Circle-1, Surat V. M/s. Padmavati Developers, SILVASSA

ITA 3001/AHD/2011

• Counselvise Citation: 300120514 RSA 2011
• Duration Of Justice: 3 year(s) 7 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 15-07-2015
• Assessment Year: 2008-2009
• Appeal Filed On: 02-12-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA SINGH
• Assessee Lawyers: URVASHI SHODHAN A R

Judgement Text

.3 , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH, AHMEDABAD BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI S. S. GODARA, JUDICIAL MEMBER ./ ././ ./ ITA NO. 3001/AHD/2011 / ASSESSMENT YEAR: 2008-09 DCIT, CENTRAL CIRCLE-1, SURAT VS. M/S. PADMAVATI DEVELOPERS S.NO. 19/2/2/, SUNDERVAN SOCIETY, SILVASSA PAN : ABDFS 3759 A / // / (APPELLANT) / // / (RESPONDENT) REVENUE BY : SHRI NARENDRA SINGH, SR. DR ASSESSEE(S) BY : SMT. URVASHI SHODHAN, AR !' # $%&/ // / DATE OF HEARING : 15/07/2015 '( # $%& / // / DATE OF PRONOUNCEMENT: 24/07/2015 )* )* )* )*/ // / O R D E R PER G.D. AGRAWAL, VICE PRESIDENT: THIS IS AN APPEAL FILED BY THE REVENUE AND IS DIREC TED AGAINST THE ORDER OF THE LD. COMMISSIONER OF INCOME-TAX (APPEAL S)-II, AHMEDABAD DATED 18.08.2011, PERTAINING TO ASSESSMENT YEAR 200 8-09. 2. THE ONLY GROUND RAISED IN THIS APPEAL BY THE REV ENUE READS AS UNDER:- THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DEL ETING THE DISALLOWANCE OF RS.48,70,030/- MADE BY THE A.O. ON ACCOUNT OF DE DUCTION U/S 80IB(10) EVEN THOUGH THE ASSESSEE FAILED TO FULFILL THE COND ITIONS LAID DOWN IN SECTION 80IB(10) OF THE ACT. 3. THE FACTS OF THE CASE ARE THAT THE ASSESSEE IS E NGAGED IN THE BUSINESS OF DEVELOPMENT AND CONSTRUCTION OF RESIDENTIAL FLAT S. IN THE YEAR UNDER ITA NO. 3001/AHD/2011 DCIT VS. PADMAVATI DEVELOPERS FOR AY 2008-09 2 CONSIDERATION, THE ASSESSEE CLAIMED DEDUCTION U/S 8 0IB(10) AT RS.48,70,028/- WHICH WAS DENIED BY THE ASSESSING OF FICER WITH THE FOLLOWING FINDINGS:- AFTER VERIFICATION OF THE DETAILS FILED BY THE ASS ESSEE AND AFTER PHYSICAL VERIFICATION OF THESE PROJECTS BY THE UNDERSIGNED, IT IS UNEARTHED THAT THE ASSESSEE HAD NOT FULFILLED THE FOLLOWING CONDITIONS LAID BY THE INCOME TAX ACT FOR CLAIMING THE DEDUCTION U/S 80IB(10). THE PROJECT IS NOT COMPLETED IN STIPULATED TIME AS PER REQUIREMENT OF SECTION 80IB(10). AS PER CONDITION LAID DOWN BY TH IS SECTION THE PROJECT HAVE TO BE COMPLETED WITHIN FOUR YEAR FROM THE FY IN WHICH THE FIRST APPROVAL OF COMMENCEMENT CERTIFICATE WAS ISSUED. IN THIS CASE THE COMMENCEMENT CERTIFICATE WAS ISSUED BY LOC AL AUTHORITY ON 20.10.2005, THEREFORE THE ASSESSEE HAD TO COMPLETE THE WHOLE PROJECT ON OR BEFORE 31.03.2010. THE PROJECT CONSIST TOWER A TO M. 13 TOWERS FOR WHICH THE ASSESSEE FAILED TO COMPLETE THE TOWER A, G, J & K AND ACCORDINGLY FAILED TO FURNISH THE COMPLETION CERTIF ICATE. SINCE THE ABOVE CONDITION WAS NOT FULFILLED THEREFO RE THE ASSESSEE WAS ASKED TO SHOW CAUSE VIDE ORDER SHEET DATED 09.12.2010 THA T WHY THE EXEMPTION U/S 80IB(10) SHOULD NOT BE WITHDRAWN AND WHY THE SAME S HOULD NOT BE ADDED TO TOTAL INCOME. 4. ON APPEAL, THE CIT(A) ALLOWED THE RELIEF WITH TH E FOLLOWING FINDINGS:- 2.3 I HAVE CONSIDERED THE FACTS AND THE SUBMISSION S OF THE APPELLANT. I AGREE WITH THE ARGUMENTS AND THE SUBMISSIONS MADE B Y THE LEARNED COUNSEL FOR THE FOLLOWING REASONS:- A.) ON PERUSAL OF CERTIFICATES OF APPROVAL AND CERTIFIC ATES OF COMPLETION ISSUED BY LOCAL AUTHORITY FROM TIME TO TIME IT IS F OUND THAT ALL TOWERS WERE COMPLETED BEFORE THE STIPULATED DATE. THE APP ELLANT SO FAR AS THE TOWER A IS CONCERNED, IT WAS NOT CONSTRUCTED AND INSTEAD THE SPACE FOR TOWER A WAS UTILIZED FOR THE PURPOSE OF CONST RUCTION OF A TEMPLE WITH APPROVAL OF LOCAL AUTHORITY AND THE TOWER M WAS RENAMED AS TOWER A. THE TOWER M (RENAMED AS TOWER A) WA S COMPLETED ON 17.09.2009 I.E. BEFORE 31.03.2010. THE COMPLETION CERTIFICATES IN RESPECT OF OTHER TOWERS G & J WERE OBTAINED ON 17.1 0.2008 & ITA NO. 3001/AHD/2011 DCIT VS. PADMAVATI DEVELOPERS FOR AY 2008-09 3 30.09.2009 RESPECTIVELY. THESE ALL DATES FALL BEFOR E 31.03.2010. THE TOWER K WAS SOLD AS FSI AND SO THERE IS NO QUESTI ON OF COMPLETION CERTIFICATE IN TOWER K. TOWER K WAS NEVER CONST RUCTED. IN FACT, THE TOWER M (RENAMED AS TOWER A), G & J WERE COMPLE TED BEFORE 31.03.2010 AND EVEN THE SALES IN RESPECT OF UNITS O F THESE TOWERS WERE SHOWN IN AY 2009-10 & AY 2010-11 IN THE RETURN OF I NCOME WHICH WERE AVAILABLE AT THE TIME OF ASSESSMENT PROCEEDING S. SO, EVEN IF THE CONSTRUCTION OF TOWER IS CONSIDERED TO BE A SINGLE PROJECT, IT WAS COMPLETED BEFORE 31.03.2010 IN KEEPING WITH THE CON DITION THAT EXISTED IN SUB CLAUSE (II) OF CLAUSE (A) OF SECTION 80IB(10). 5. THE REVENUE, AGGRIEVED WITH THE ORDER OF THE CIT (A), IS IN APPEAL BEFORE US. 6. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL PLACED BEFORE US. AFTER CONSIDERING THE FACTS OF THE CASE AND THE ARGUMENTS OF BOTH THE SIDES, WE DO NOT FIND ANY JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE CIT(A). THE ASSESSING OFFICER DENIED THE EX EMPTION TO THE ASSESSEE ON THE GROUND THAT THE PROJECT OF THE ASSESSEE WAS CONSISTED OF 13 TOWERS AND OUT OF THOSE 13 TOWERS, THE ASSESSEE DID NOT CO MPLETE 4 TOWERS, I.E., TOWER A, G, J AND K BEFORE THE STIPULATED PERIOD AS PER SECTION 80IB(10). THE CIT(A) HAS RECORDED THE FINDING THAT TOWER K WAS NEVER CONSTRUCTED, BECAUSE THE ASSESSEE SOLD THE FSI RELA TING TO TOWER K. HE ALSO RECORDED THE FINDING THAT TOWER G & J WERE COMPLETED MUCH BEFORE THE STIPULATED DATE AND HE ALSO MENTIONED THE DATE OF COMPLETION CERTIFICATE WHICH WERE 17.10.2008 AND 30.09.2009 RE SPECTIVELY FOR TOWER G & J. HE ALSO POINTED OUT THAT THE TOWER M WAS RENAMED AS TOWER A AND WHICH WAS ALSO COMPLETED ON 17.09.2009. THESE FACTUAL FINDINGS RECORDED BY THE CIT(A) HAVE NOT BEEN CONTROVERTED B EFORE US. THUS, WHEN ALL THE TOWERS WERE ALREADY COMPLETED BEFORE THE ST IPULATED DATE, I.E., 31.03.2010; IN OUR OPINION, THE CIT(A) WAS FULLY JU STIFIED IN DIRECTING THE ASSESSING OFFICER TO ALLOW DEDUCTION U/S 80IB(10). WE, THEREFORE, FIND NO ITA NO. 3001/AHD/2011 DCIT VS. PADMAVATI DEVELOPERS FOR AY 2008-09 4 JUSTIFICATION TO INTERFERE WITH THE ORDER OF THE CI T(A) WHICH IS SUSTAINED AND THE REVENUES APPEAL IS DISMISSED. 7. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE COURT ON 24 TH JULY, 2015 AT AHMEDABAD. SD/- SD/- (S. S. GODARA) JUDICIAL MEMBER (G.D. AGRAWAL) VICE-PRESIDENT AHMEDABAD; DATED 24/07/2015 BIJU T., PS )* # $+ ,)+$ )* # $+ ,)+$ )* # $+ ,)+$ )* # $+ ,)+$/ COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. $ !- / CONCERNED CIT 4. !- ( ) / THE CIT(A) 5. +01 $ , , / DR, ITAT, AHMEDABAD 6. 13 4' / GUARD FILE . )*! )*! )*! )*! / BY ORDER, TRUE COPY 5 55 5/ // / 6 6 6 6 ( DY./ASSTT.REGISTRAR) , , , , / ITAT, AHMEDABAD