MORYA WASTU RACHANA P. LTD, ULHASNAGAR V. ITO 1(4), KALYAN

ITA 5405/MUM/2008

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 8104 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 23-02-2011
• Assessment Year: 2003-2004
• Appeal Filed On: 28-08-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MOHAMMED USMAN
• Assessee Lawyers: SAMEER G DALAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH B, MUMBAI BEFORE SHRI N.V.VASUDEVAN(J.M) & SHRI J.SUDHAKAR R EDDY(A.M) ITA NO.5405/M/2008(A.Y.2003-04) MORYA WASTU RACHANA P. LTD. C/O. SHRI RAJENDRA Y. PATIL,101, SHREE YASH APARTMENT, BLOCK NO.A/317/133, KURLA CAMP, ULHASNAGAR- 421 065 PAN:AABCM 3032G (APPELLANT) VS. THE I.T.O 1(4), KALYAN. (RESPONDENT) APPELLANT BY : SHRI SAMEER G.DALAL RESPONDENT BY : SHRI MOHAMMED USMAN ORDER PER N.V.VASUDEVAN, J.M, THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDE R DATED 15/5/2008 OF CIT(A)-1, MUMBAI RELATING TO ASSESSMENT YEAR 200 3-04. THE ONLY ISSUE THAT ARISES FOR CONSIDERATION IN THIS APPEAL IS AS TO WHETHER THE CIT(A) WAS JUSTIFIED IN CONFIRMING THE ACTION OF THE AO IN DIS ALLOWING THE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER SECTION 80IB(10) OF TH E INCOME TAX ACT, 1961 (THE ACT) OF RS.11,03,736/-. 2. THE ASSESSEE IS A COMPANY. IT IS ENGAGED IN THE BUSINESS OF CONSTRUCTION OF BUILDINGS. THE ASSESSEE CLAIMED D EDUCTION U/S. 80 IB(10) OF THE ACT IN RESPECT OF DEVELOPMENT OF A HOUSING PROJECT. IN A.Y. 2001-02 ALSO IN RESPECT OF THE VERY SAME HOUSING PROJECT T HE ASSESSEE HAD CLAIMED DEDUCTION UNDER SECTION 80IB(10) OF THE ACT. IN A. Y 2001-02 THE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER SECTION 80 IB(10) OF T HE ACT WAS DENIED FOR THE REASON THAT THE ASSESSEE DID NOT COMMENCE THE DEVE LOPMENT AND CONSTRUCTION OF THE PROJECT ON OR AFTER 1/10/1998. ANOTHER REASON GIVEN WAS ITA NO.5405/M/2008(A.Y.2003-04) 2 THAT THERE WERE COMMERCIAL AREA IN THE BUILDING PRO JECT AND, THEREFORE, IT CANNOT BE SAID THAT THE PROJECT CONSTRUCTED BY THE ASSESSEE WAS A HOUSING PROJECT ENTITLED TO DEDUCTION UNDER SECTION 80 IB(1 0) OF THE ACT. THE AO FOLLOWING HIS DECISION IN A.Y 2001-02 DID NOT ALLOW THE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT I N THE PRESENT ASSESSMENT YEAR ALSO. THE CIT(A) CONFIRMED THE ORDER OF THE AO. 3. AGGRIEVED BY THE ORDER OF THE CIT(A) THE ASSESSE E HAS PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 4. AT THE TIME OF HEARING IT WAS BROUGHT TO OUR NOT ICE THAT IN A.Y 2001-02 THE CLAIM OF THE ASSESSEE FOR DEDUCTION UNDER SECTI ON 80IB(10) OF THE ACT WAS ALLOWED BY THE CIT(A) AND THE HONBLE ITAT C BENC H IN ITA NO.8457/M/04 BY ORDER DATED 25/8/2009 WAS PLEASED TO CONFIRM THE ORDER OF THE CIT(A). THE TRIBUNAL IN A.Y 2001-02 HELD THAT THE PROJECT O F THE ASSESSEE COMMENCED AFTER 1/10/1998. THE TRIBUNAL ALSO HELD THAT THE COMMERCIAL AREA IN THE BUILDING PROJECT WAS ONLY 6.32%. THE T RIBUNAL FURTHER REFERRED TO THE DECISION OF THE SPECIAL BENCH OF THE ITAT PUNE IN THE CASE OF BRAMHA ASSOCIATES, 119 ITD 255(PUNE)(SB) WHEREIN IT HAD HE LD THAT ANY USE OF LESS THAN 10% OF TOTAL PROJECT AREA FOR COMMERCIAL PURP OSE WOULD NOT DISENTITLE AN ASSESSEE FROM CLAIMING DEDUCTION UNDER SECTION 8 0 IB(10) OF THE ACT ON THE GROUND THAT IT IS A HOUSING PROJECT. IN VIEW O F THE ABOVE DECISION AND IN VIEW OF THE FACT THAT THE FACTS IN THE PRESENT ASSE SSMENT YEAR ARE IDENTICAL AND THE PROFITS IN QUESTION RELATES TO THE VERY SAM E PROJECT, RESPECTFULLY ITA NO.5405/M/2008(A.Y.2003-04) 3 FOLLOWING THE DECISION OF THE TRIBUNAL WE DIRECT TH E AO TO ALLOW THE CLAIM FOR DEDUCTION UNDER SECTION 80 IB(10) OF THE ACT AS CLA IMED BY THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 28 TH DAY OF FEBRUARY 2011. SD/- SD/- (J.SUDHAKAR REDDY) (N.V.VASUDEVAN) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED. 28 TH FEB.2011 COPY TO: 1. THE APPELLANT 2. THE RESPONDENT 3 . THE CIT CITY CONCERNED 4. THE CIT(A)- CONCERNED 5. THE D.RB BENCH. (TRUE COPY) BY ORDER ASST. REGISTRAR, I TAT, MUMBAI BENCHES MUMBAI. VM. ITA NO.5405/M/2008(A.Y.2003-04) 4 DETAILS DATE INITIALS DESIGNATION 1 DRAFT DICTATED ON 24/2/11 SR.PS/PS 2 DRAFT PLACED BEFORE AUTHOR 25/2/11 SR.PS/PS 3 DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4 DRAFT DISCUSSED/APPROVED BY SECOND MEMBER JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON SR.PS/PS 7. FILE SENT TO THE BENCH CLERK SR.PS/PS 8 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK 9 DATE OF DISPATCH OF ORDER