ITO, Ward -36(2), Kolkata, Kolkata V. M/s. Shree Krishna Developers, Kolkata

ITA 348/KOL/2012

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 1553 (ITAT-KOLKATA)
• Duration Of Justice: 5 year(s) 6 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 20-03-2017
• Assessment Year: 2004-2005
• Appeal Filed On: 06-03-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: CROSS OBJECTOR SHRI D S DAMLE
• Keywords: Business expenditure; Retrospective amendment; Tax effect
• Section: 143(3); 80IB; 147

Judgement Text

1 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 , A , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH: KOL KATA () BEFORE .., /AND , ) [BEFORE SHRI A. T. VARKEY, JM & SHRI WASEEM AHMED, AM] I.T.A. NO. 348/KOL/2012 ASSESSMENT YEAR: 2004-05 INCOME-TAX OFFICER, WD-36(2), KOLKATA VS. M/S. SHRE E KIRSHNA DEVELOPERS (PAN: AAAAS9791F) APPELLANT RESPONDENT & C.O. NO.108/KOL/2012 IN I.T.A. NO. 348/KOL/2012 ASSESSMENT YEAR: 2004-05 M/S. SHREE KIRSHNA DEVELOPERS VS. INCOME-TAX OFFICER, WD-36(2), KOLKATA CROSS OBJECTOR RESPONDENT & I.T.A. NO. 349/KOL/2012 ASSESSMENT YEAR: 2005-06 INCOME-TAX OFFICER, WD-36(2), KOLKATA VS. M/S. SHRE E KIRSHNA DEVELOPERS (PAN: AAAAS9791F) APPELLANT RESPONDENT & C.O. NO.109/KOL/2012 IN I.T.A. NO. 349/KOL/2012 ASSESSMENT YEAR: 2005-06 M/S. SHREE KIRSHNA DEVELOPERS VS. INCOME-TAX OFFICER, WD-36(2), KOLKATA CROSS OBJECTOR RESPONDENT DATE OF HEARING 04.07.2017 DATE OF PRONOUNCEMENT 08.09.2017 FOR THE REVENUE SHRI SALLONG YADEN, ADDL. CIT FOR THE ASSESSEE/CROSS OBJECTOR SHRI D. S. DAMLE, FCA 2 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 ORDER PER SHRI A.T.VARKEY, JM THE APPEALS PREFERRED BY THE REVENUE AND THE CROSS OBJECTIONS PREFERRED BY THE ASSESSEE ARE AGAINST THE SEPARATE ORDERS OF LD. CIT (A)-XX, KOLKATA DATED 26.12.2011 FOR AYS 2004-05 AND 2005-06. SINCE ISSUES ARE COMMON A ND FACTS ARE IDENTICAL, WE DISPOSE OF ALL THESE APPEALS AND THE CROSS OBJECTIONS BY THIS CONSOLIDATED ORDER FOR THE SAKE OF BREVITY AND CONVENIENCE. 2. AT THE OUTSET ITSELF, THE LD. COUNSEL FOR THE AS SESSEE DREW OUR ATTENTION TO THE FACT THAT THE APPEAL OF THE REVENUE FOR AY 2004-05 NEEDS TO B E DISMISSED FOR LOW TAX EFFECT I.E. THE DISPUTED ADDITION IS LESS THAN RS. 10 LACS. AT THE OUTSET, WE FIND THAT THE APPEAL OF THE REVENUE FALLS IN THE KEN OF THE CBDT CIRCULAR NO. 2 1/2015 DATED 10.12.2015, WHEREIN THE CBDT HAS DIRECTED THE DEPARTMENT TO WITHDRAW/NOT PR ESS THE APPEAL IF THE TAX EFFECT IS LESS THAN RS. 10 LACS BEFORE THE ITAT. ON PERUSAL OF TH E CIRCULAR NO. 21 / 2015 DATED 10.12.2015 AND THE MATERIALS AVAILABLE ON RECORD, W E FIND THAT THE REVENUES CASE DOES NOT FALL UNDER ANY OF THE EXCEPTION CLAUSE AS PROVIDED IN THE CIRCULAR, AS THIS IS COVERED. WE ALSO FIND THAT THE CIRCULAR MAKES IT VERY CLEAR THAT THE REVISED MONETARY LIMITS SHALL APPLY RETROSPECTIVELY TO PENDING APPEALS ALSO. WE FIND TH AT THE CIRCULAR IS BINDING ON THE TAX AUTHORITIES. THIS POSITION HAS BEEN CONFIRMED BY TH E HONBLE APEX COURT IN THE CASE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATION L TD REPORTED IN 267 ITR 272 (SC). HENCE, WE HOLD THAT THE APPEAL OF THE REVENUE DESER VES TO BE DISMISSED IN TERMS OF LOW TAX EFFECT VIDE CIRCULAR NO.21 / 2015 DATED 10.12.2015. ACCORDINGLY, THIS BEING A LOW TAX EFFECT CASE, WE DISMISS THIS APPEAL OF REVENUE IN LIMINE, AS UNADMITTED, WITHOUT GOING INTO THE MERITS OF THE CASE. IN CASE THE REVENUE LATER FIND S THAT THE TAX EFFECT IS MORE THAN RS. 10 LAKHS THEN IT IS AT LIBERTY TO MOVE APPROPRIATE APP LICATION TO RECALL THIS ORDER. WITH THIS CAVEAT, WE ARE INCLINED TO DISMISS THIS APPEAL ON T HE GROUND THAT IT IS BELOW THE TAX EFFECT OF LESS THAN RS.10 LAKH. THEREFORE, THIS APPEAL OF REV ENUE IS DISMISSED. 3. SINCE WE HAVE DISMISSED THE APPEAL OF THE REVENU E FOR AY 2004-05 AND SINCE THE CROSS OBJECTION FILED BY THE ASSESSEE FOR AY 2004-0 5 IS ONLY SUPPORTING THE LD. CIT(A)S ORDER IT HAS BECOME INFRUCTUOUS AND HENCE, THE SAME IS ALSO DISMISSED AS INFRUCTUOUS. 4. NOW, COMING TO REVENUES APPEAL FOR AY 2005-06, WE NOTE THAT THE FIRST GROUND OF APPEAL IS AGAINST THE ACTION OF THE LD. CIT(A) IN I GNORING THE FINDING OF FACT GIVEN BY THE 3 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 AO THAT SOME OF THE RESIDENTIAL UNIT IN THE HOUSING PROJECT ARE HAVING BUILT UP AREA OF MORE THAN 1500 SQ. FT., THUS NOT QUALIFYING FOR DEDUCTIO N U/S. 80IB OF THE ACT. 5. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE IS AN ASSOCIATION OF PERSONS ENGAGED IN DEVELOPING AND BUILDING HOUSING PROJECTS AT KOLKATA . RETURN OF INCOME WAS FILED BY THE ASSESSEE ON 24.10.2005 SHOWING A TOTAL INCOME AT N IL AFTER CLAIMING DEDUCTION U/S. 80IB OF THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED T O AS THE ACT). THE RETURN OF INCOME WAS PROCESSED U/S. 143(1) OF THE ACT ON 26.12.2006 AT NIL. LATER THE CASE WAS REOPENED U/S. 147 OF THE ACT ON THE FOLLOWING REASON: 1. THE CONDITION, MENTIONED IN 80IB(2)(I) OF THE I. TAX ACT, 1961 THAT THE INDUSTRIAL UNDERTAKING IS NOT FORMED BY SPLITTING UP, RECONSTR UCTION OF A BUSINESS ALREADY IN EXISTENCE WAS NOT FULFILLED BY THE ASSESSEE AOP AND THEREFORE CLAIM OF DEDUCTION U/S. 80IB OF THE I. TAX ACT, 1961 FOR RS.64,83,051.57 WAS WRONGLY ALLOWED I N THE ORDER U/S. 143(3) OF THE INCOME TAX ACT, 1961 DATED 15.12.2006, WHICH RESULTED IN UNDER ASSESSMENT OF INCOME BY THAT AMOUNT. II) INTEREST ON CAPITAL OF THE MEMBERS OF AN AOP FI RM IS NOT ALLOWED AS BUSINESS EXPENDITURE AND THE SUM OF RS.20,04,400/-, DEBITED IN THE P&L A CCOUNT UNDER THE ACCOUNTING HEAD OF INTEREST ON CAPITAL OF THE MEMBERS OF THE AOP, WA S WRONGLY ALLOWED AS BUSINESS EXPENDITURE, WHICH RESULTED IN UNDER ASSESSMENT OF INCOME BY THA T AMOUNT. 6. THE ASSESSEES OBJECTION TO THE NOTICE FOR REOPE NING WAS NOT ACCEPTABLE TO THE AO, THEREFORE, HE PROCEEDED TO ASSESS THE ASSESSEE. AS PER THE AO, THERE WAS AN INFRINGEMENT IN THE CONDITION MENTIONED IN SEC. 80IB(2)(I) OF THE A CT THAT THE INDUSTRIAL UNDERTAKING IS NOT FORMED BY SPLITTING UP THE CONSTRUCTION OF BUSINESS ALREADY IN EXISTENCE WAS NOT FULFILLED BY THE ASSESSEE AOP AND, THEREFORE, THE CLAIM OF DEDUC TION U/S. 80IB OF THE ACT FOR RS.64,83,051.57 WAS WRONGLY ALLOWED WHICH WAS CHALL ENGED BY THE ASSESSEE BEFORE THE LD. CIT(A) WHO WAS PLEASED TO HOLD THAT THE CONDITION M ENTIONED IN SEC. 80IB(2)(I) OF THE ACT IS FOR AN INDUSTRIAL UNDERTAKING AND NOT FOR THE AS SESSEE WHO IS ENGAGED IN DEVELOPING AND BUILDING HOUSING PROJECTS WHICH COMES UNDER SECTION 80IB(10) OF THE ACT. AGAINST THE SAID DECISION OF THE LD. CIT(A) THE REVENUE DID NOT PREF ER ANY APPEAL BEFORE US. FURTHER, THE AO HAD FOUND FAULT WITH THE ASSESSEE FOR BREACH OF THE CONDITION MADE IN SEC. 80IB OF THE ACT THAT THE MAXIMUM BUILT UP AREA SHOULD BE 1500 SQ. F T. AND THAT THE ASSESSEE HAS FAULTED ON THIS CONDITION. THE AO DISCUSSED THE SAID FACTS IN PAGE NOS. 7 -9 OF HIS ORDER AND CONCLUDED AS UNDER: THE SUBMISSION MADE BY THE ASSESSEE AOP IN THIS C ONNECTION WAS PERUSED IN LIGHT OF THE FACTS OF THE CASE AND FOUND THAT THE ASSESSEE AOP H AS MANAGED TO SHOW THE BUA OF THE AFORESAID FLATS IN THE WAY IT REQUIRES TO GET DEDUC TION UNDER SECTION 80IB BUT FROM PERUSAL OF THE BUILDING PLAN OF BLOCK-C IT MAY BE SEEN THAT 15 00 MM WIDE OPEN TERRACE CONSTITUTES THE 4 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 PART OF THE AFORESAID FLATS BUT THE AREA OF THESE O PEN TERRACE OF THOSE FLATS WERE NOT CONSIDERED WHILE CALCULATING BUA OF THE SAID FLATS. IN FACT THE OPEN TERRACE WHICH CONSTITUTES THE PART OF THE SAID FLATS CANNOT BE EXCLUDED FROM THE BUA AS B ECAUSE THE FLAT OWNERS ATTACHED TO THAT WIDE OPEN TERRACE ONLY CAN HAVE ACCESS TO THE RESPE CTIVE OPEN TERRACE AND OBVIOUSLY THEY HAVE RIGHT TO USE THEM. AS SUCH THE ASSESSEE HAS COMMIT TED INFRINGEMENT OF PROVISIONS OF SECTION 80IB(10)(C) OF THE I. T. ACT, AND LIABLE TO BE TREA TED AS INELIGIBLE FOR DEDUCTION U/S. 80IB(10). THE SUBMISSION MADE BY THE ASSESSEE AOP IN THIS CON NECTION WITH THE FLATS SOLD TO SRI VIVEK GOLECHA WAS PERUSED IN LIGHT OF THE FACTS OF THE CA SE AND FOUND THAT THE ASSESSEE AOP HAS JUST MANAGED TO SHOW ONE UNIT OF RESIDENTIAL UNIT INTO T WO DIFFERENT UNITS TO AVOID INFRINGEMENT OF PROVISIONS OF SECTION 80IB(10) OF THE I. T. ACT, 1 961 AND THUS THE ASSESSEE HAS COMMITTED INFRINGEMENT OF PROVISIONS OF SECTION 80IB(10)(C) O F THE I. T. ACT, AND LIABLE TO BE TREATED AS INELIGIBLE FOR DEDUCTION U/S. 80IB(10). AGGRIEVED, ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A), WHO DISCUSSED THIS ISSUE AT PAGES 13 TO 20 OF THE IMPUGNED ORDER AND WAS PLEASE D TO ALLOW THE APPEAL OF THE ASSESSEE. AGGRIEVED, THE REVENUE IS BEFORE US. 7. ACCORDING TO AO, THE BUILT UP AREA IN CASE OF SOME OF THE FLATS (FOUR FLATS) WAS IN EXCESS OF 1500 SQ. FT.. AS PER CLAUSE (C) OF SECTI ON 80IB(10) OF THE ACT, THE MAXIMUM BUILT UP AREA FOR ANY RESIDENTIAL UNIT CANNOT GO BEYOND 1 500 SQ. FT. ACCORDING TO THE AO, BUILT UP AREA IN RESPECT TO THREE FLATS ARE IN EXCESS OF 1500 SQ. FT. AND ONE FLAT OF 1752 SQ. FT. WHICH HAS BEEN BROKEN INTO TWO UNITS BY THE ASSESSEE TO A VOID INFRINGEMENT OF THE PROVISION OF SEC. 80IB(10)(C) OF THE ACT. THE AO HAS DETERMINED THE BUILT UP AREA OF THREE FLATS BY APPLYING AN AVERAGE PERCENTAGE OF TOTAL BUILT UP AREA ON THE BASIS OF TOTAL SUPER BUILT UP AREA OF THE THREE FLATS TO THAT OF THE WHOLE PROJECT AND CALCUL ATED THE BUILT UP AREA OF THE SAID THREE FLATS AT 1540.8 SQ. FT. EACH. THE AO WAS OF THE OPINION THAT FLAT NO. BF, 7E AND 8E SITUATED VERTICALLY HAVING BEEN SOLD TO ONE BUYER IN THE RE LEVANT AY WAS ONE FLAT OF BUILT UP AREA OF 1752 SQ. FT. WHICH HAS BEEN BROKEN INTO TWO UNITS T O AVOID BEING HIT BY SEC. 80IB(10)(C) OF THE ACT. THE AO ALSO FOUND IN BLOCK C OF THE BUILDI NG PLAN THAT 1500 MM WIDE OPEN TERRACE WAS NOT INCLUDED IN THE BUILT UP AREA OF THE RESIDE NTIAL UNIT HAVING SUCH OPEN TERRACE. BEFORE THE LD. CIT(A), THE ASSESSEE DREW THE ATTENTION OF THE LD. CIT(A) THAT THE METHOD ADOPTED BY THE AO FOR CALCULATING THE BUILT UP AREA IS FAUL TY AND THAT THERE IS NO UNIFORMITY IN THE SUPER BUILT UP CHARGED TO THE BUYER. IT HAS ALSO B EEN BROUGHT TO THE KNOWLEDGE OF THE LD. CIT(A) THAT THE EVIDENCE FURNISHED BY THE ASSESSEE LIKE BUILDING PLAN, ARCHITECT CERTIFICATE AND THE AGREEMENT WITH THE BUYER HAS BEEN BRUSHED A SIDE BY THE AO AND THE AO HAS WRONGLY INCLUDED THE AREA OF OPEN TERRACE IN RESPEC T OF CONCERNED FLATS TO COME TO THE CONCLUSION THAT BUILT UP AREA IS MORE THAN 1500 SQ. FT. AFTER TAKING NOTE OF THE CONTENTION OF 5 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 THE LD. AR WHICH IS REPRODUCED BY THE LD. CIT(A) FR OM PAGES 13 TO 19, THE LD. CIT(A) CONCLUDED THAT THE AO HAS NOT GIVEN ANY CREDENCE TO THE EVIDENCE FURNISHED BY THE ASSESSEE LIKE BUILDING PLAN, ARCHITECT CERTIFICATE, AGREEMEN T WITH THE BUYER IN ORDER TO PROVE THE CLAIM THAT THE BUILT UP AREA WAS LESS THAN 1500 SQ. FT. THE LD. CIT(A) RIGHTLY HELD THAT THE AO ERRED IN DISCARDING THE BUILDING PLAN SUBMITTED BY THE ASSESSEE WHICH SPECIFIES THE MEASUREMENT OF EACH UNIT IS ON RECORD, AND THE CALC ULATION OF BUILT UP AREA WHICH WAS ADOPTED BY THE AO BY METHOD OF REVERSE CALCULATION WAS TOTALLY UNWARRANTED IN THE FACTS OF THE CASE. WHEN THE EXACT FIGURES CAN BE DERIVED FR OM THE RECORD SUBMITTED BY THE ASSESSEE, THE AO RESORTING TO ESTIMATION WAS AN EXERCISE NOT CALLED FOR WITHOUT FINDING ANY FAULT IN THE BUILDING PLAN AND CERTIFICATE OF THE ARCHITECT WHIC H WERE SUBMITTED BEFORE THE AO. THE CONCLUSION OF THE AO THAT THE ISSUE OF 1500 MM WIDE OPEN TERRACE CANNOT BE SUSTAINED BECAUSE THE COORDINATE BENCH OF THIS TRIBUNAL OF AH MEDABAD BENCH IN THE CASE OF AMALTAS ASSOCIATES VS. ITO (2011) 11 TAXMAN.COM 420 (AHD.) HAS HELD THAT WHILE CALCULATING THE BUILT UP AREA OF A RESIDENTIAL UNIT, THE AREA OF OP EN TERRACE SHALL NOT BE INCLUDED. WE NOTE THAT THE AO ERRED IN STATING THAT FLAT NO. BF, 7E A ND 8E ARE SITUATED VERTICALLY WHEREAS THERE ARE TWO RESIDENTIAL UNITS SIDE BY SIDE ON THE SAME FLOOR AND THE BUYER WAS SHRI VIVEK GOLCHA. THE LD. CIT(A) HAS GONE THROUGH THE AGREEM ENT WITH THE BUYER AND HAS MADE A FINDING THAT THE TWO RESIDENTIAL UNITS AS PER THE S ANCTIONED BUILDING PLAN AND THE ARCHITECT CERTIFICATE WHICH CERTIFIES THE BUILT UP AREA OF TH E SAID UNIT AS 858 AND 894 SQ. FT. WHICH IS MUCH BELOW THE SPECIFIED LIMIT OF 1500 SQ. FT. THE LD. CIT(A) RIGHTLY RELIED ON THE COORDINATE BENCH DECISION OF BOMBAY IN THE CASE OF EMGEEN HOLDINGS (P) LTD. VS. DCIT (2011) 12 TAXMANN.COM 468 (MUM) WHEREIN IT HAS BEEN HELD THAT EVEN IF FLATS WERE CONSTRUCTED OR PLANNED IN SUCH A WAY THAT TWO FLATS WOULD BE MERGED INTO ONE LARGER UNIT, AS LONG EACH FLAT WAS AN INDEPENDENT RESIDENTIAL UNIT, DEDUCTION U/S. 80IB(10) OF THE ACT COULD NOT BE DECLINED. THE LD. CIT(A) RIGHTLY TOOK NOTE O F THE FACT THAT CLAUSE (F) OF SEC. 80IB(10) OF THE ACT WHICH RESTRICTS MORE THAN ONE UNIT TO TH E SAME PERSON OR HIS RELATIVE IS APPLICABLE W.E.F. 01.04.2010 AND HAS NO RETROSPECTIVE EFFECT. WE FULLY CONCUR WITH THE REASONS ADDUCED BY THE LD. CIT(A) TO REVERSE THE FINDING OF THE AO WHICH IS FACTUALLY AND AS PER THE LAW IS CORRECT AND WE DO NOT FIND ANY INFIRMITY IN THE ORD ER OF THE LD. CIT(A), THEREFORE, WE DISMISS THE GROUND OF APPEAL OF THE REVENUE. 6 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 8. GROUND NO. 2 OF THE REVENUE IS AGAINST THE ACTIO N OF THE LD. CIT(A) IN IGNORING THE FINDING OF FACT OF THE AO THAT BUILT UP AREA OF SHO P AND OTHER COMMERCIAL AREAS ARE EXCEEDING 2000 SQ. FT. THE AO NOTED THAT THE SUPER BUILT UP AREA OF COMMERCIAL AREA SOLD IN THE RELEVANT ASSESSMENT YEAR WAS 2071 SQ. FT. AS PE R THE DETAILS SUBMITTED WITH THE RETURNS. THE AO CONFRONTED THE ASSESSEE THAT AS PER THE BUIL T UP AREA AS CLAIMED BY THE ASSESSEE AND THE COMMERCIAL AREA WAS ONLY 1886 SQ. FT. WHICH COM ES TO 65% OF THE SUPER BUILT UP AREA WHICH ACCORDING TO THE AO WAS NOT INCONFORMITY WITH THE POLICY OF THE ASSESSEE AND HE GAVE CERTAIN FIGURES FROM PAGE 12 TO 13 AND CONCLUDED AS UNDER: THE SUBMISSION MADE BY THE ASSESSEE AOP IN THIS C ONNECTION WAS PERUSED IN LIGHT OF THE FACTS OF THE CASE AND FOUND THAT THE ASSESSEE AOP H AS MANAGED HERE ALSO TO SHOW THE BUA OF THE AFORESAID FLATS IN THE WAY IT REQUIRES TO GET D EDUCTION UNDER SECTION 80IB. FROM PERUSAL OF THE BUILDING PLAN OF BLOCK-A (GROUND FLOOR) IT MAY BE SEEN THAT FOUR ROOMS MEASURING EACH 2875MM X 1000 MM, 1750 MM X 5700, 7950 MM X 4075 MM AND 1750 MM X 5700 MM HAVE BEEN SHOWN AS SERVANT ROOMS, AREA MEASURING 3960MM X 3800 MM AS REST ROOM IN THE BUILDING PLAN ONLY TO MAINTAIN STIPULATED RATIO OF SHOP AREA/COMMERCIAL AREA TO AVAIL DEDUCTION UNDER SECTION 80IB. BUT IT APPEARS VERY IMPRACTICAL FOR A COMMERCIAL MAN TO LEAVE ABOVE STATED AREA AS SERVANT ROOMS AND REST ROOM. AS SUCH THE ASSESSEE HAS COMMITTED INFRINGEMENT OF PROVISIONS OF SECTION 80IB(10)(D) O F THE I. T. ACT, AND LIABLE TO BE TREATED AS INELIGIBLE FOR DEDUCTION U/S. 80IB(10). AGGRIEVED, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A), WHO WAS PLEASED TO HOLD THAT THE BUILT UP AREA OF THE COMMERCIAL AREA WAS L ESS THAN 2000 SQ. FT. AND WELL WITHIN THE CONDITIONS LAID DOWN IN SECTION 80IB OF THE ACT. 9. WE HAVE HEARD RIVAL SUBMISSIONS AND GONE THROUGH FACTS AND CIRCUMSTANCES OF THE CASE. WE NOTE THAT THE AO HAS CALCULATED THE BUILT UP AREA OF SHOP AT 2170 SQ. FT. BY ADOPTING THE METHOD OF REVERSE CALCULATION. ACCORD ING TO THE AO, THE SUPER BUILT UP AREA OF COMMERCIAL SPACE EXCEEDED THE PRESCRIBED LIMIT OF 2 000 SQ. FT. AND, THEREFORE, ACCORDING TO THE AO, THE CONDITION LAID DOWN IN SECTION 80IB(10) OF THE ACT WAS BREACHED AND, THEREFORE, THE ASSESSEE WAS INELIGIBLE TO CLAIM DEDUCTION U/S. 80IB OF THE ACT. WE NOTE THAT THE AO HAS BRUSHED ASIDE THE BUILDING PLAN, ARCHITECT CERT IFICATES AND BUYERS AGREEMENT WHICH WERE PLACED ON RECORD AS EVIDENCE TO SUBSTANTIATE THAT T HE ASSESSEES BUILT UP AREA OF COMMERCIAL SPACE WAS LESS THAN 2000 SQ. FT. HOWEVER, THE AO E RRED IN ADOPTING THE METHOD OF REVERSE CALCULATION TO CALCULATE THE SUPER BUILT UP AREA TO DISALLOW THE DEDUCTION CLAIMED U/S. 80IB OF THE ACT. MOREOVER, WE NOTE THAT THE BUILT UP AR EA OF TOTAL PROJECT OF ASSESSEE IS 145500 SQ. FT AND THE BUILT UP AREA OF COMMERCIAL AREA OF 2071 SQ. FT. EVEN IF AS CALCULATED BY THE AO IS ONLY 1.42% OF THE AGGREGATE OF THE BUILT UP AREA OF THE TOTAL PROJECT. THUS, THE TOTAL BUILT 7 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 UP AREA USED FOR DWELLING UNITS COMES TO 98.58%. A S PER THE SPECIAL BENCH ORDER IN BRAHMA ASSOCIATES VS. JCIT (2009) 119 ITD 255 (PUNE , SB), THE SPECIAL BENCH ANSWERED THE QUESTION AS TO WHETHER IN ANY OTHER CASE WHERE 90% OR MORE OF TOTAL BUILT UP AREA IS USED FOR DWELLING UNITS, IN ACCORDANCE WITH SCHEME OF SE CTION 80IB(10) OF THE ACT, BENEFIT OF DEDUCTION U/S. 80IB(10) OF THE ACT WOULD NOT BE DEC LINED WAS ANSWERED IN THE AFFIRMATIVE IN FAVOR OF ASSESSEE. SO, WE NOTE THAT EVEN IF THE AO S CALCULATION IS CORRECT, STILL THE BUILD UP AREA OF THE DWELLING UNITS COMES TO AS HIGH AS 98.5 8% WHICH IS FAR ABOVE THE 90% WHICH IS THE YARDSTICK PRESCRIBED BY THE SPECIAL BENCH IN BR AHMA ASSOCIATES, (SUPRA). THESE FACTS AND THE JUDICIAL PRECEDENTS LAID DOWN BY THE SPECIA L BENCH IN THE CASE OF BRAHMA ASSOCIATES, SUPRA HAS BEEN TAKEN NOTE OF BY THE LD. CIT(A) TO OVERTURN THE FINDING OF THE AO WHICH WE CONFIRM. SINCE WE DO NOT FIND ANY INFI RMITY IN THE ORDER OF THE LD. CIT(A), THEREFORE, WE DECLINE TO INTERFERE IN THE ORDER PAS SED BY THE LD. CIT(A). THEREFORE, THIS GROUND OF APPEAL OF REVENUE IS DISMISSED. 10. GROUND NO. 3 IS GENERAL IN NATURE, HENCE, NOT A DJUDICATED. 11. GROUND NO. 4 IS NOT EMANATING FROM THE ORDERS O F THE LOWER AUTHORITIES, THEREFORE, IT HAS NOT BEEN ADJUDICATED. 12. CROSS OBJECTION OF THE ASSESSEE FOR AY 2005-06 IS IN RESPECT TO REOPENING OF THE ASSESSMENT WHICH WE ARE NOT INCLINED TO ADJUDICATE BECAUSE ON MERITS WE HAVE DECIDED THE ISSUES AND IT WOULD BE ONLY ACADEMIC IN NATURE. HE NCE, IT IS DISMISSED. 13. IN THE RESULT, BOTH THE APPEALS OF THE REVENUE AND THE CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. 14. ORDER IS PRONOUNCED IN THE OPEN COURT ON 08.0 9.2017 SD/- SD/- (WASEEM AHMED) (ABY. T. VARKEY) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 8 TH SEPTEMBER, 2017 JD.(SR.P.S.) 8 ITA NOS.348-349/KOL/2012 & CO NOS.108-109/KOL/201 2 SHREE KIRSHNA DEVELOPERS., AYS 2004-05 & 2005-06 COPY OF THE ORDER FORWARDED TO: 1 . APPELLANT ITO, WARD-36(2), KOLKATA. 2 RESPONDENT M/S. SHREE KRISHNA DEVELOPERS, 133, CA NNING STREET, 3 RD FLOOR, ROOM NO. 9, KOLKATA-700 001. 3 . THE CIT(A), KOLKATA 4. 5. CIT , KOLKATA DR, KOLKATA BENCHES, KOLKATA / TRUE COPY, BY ORDER, SR. PVT. SECRETARY