Shri Devaram M. Dharmavat, Pune V. ITO, Pune

ITA 909/PUN/2010

• Counselvise Citation: [2015] 134 COUNSELVISE.COM (IT) 1197 (ITAT-PUNE)
• Duration Of Justice: 5 year(s) 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-08-2015
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: A
• Next Hearing Date: 20-10-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 16-06-2010
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: B; RAJESH DAMOR HEERAJ JAIN
• Assessee Lawyers: S N DOSHI
• Keywords: Additional evidence; Tangible material; Difference of opinion; Competent authority; Change of opinion; Reassessment proceedings
• Section: 263

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A, PUNE . . , , ' # BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NOS.908 TO 910/PN/2010 '% % / ASSESSMENT YEARS : 2007-08, 2006-07 & 2005-06 SHRI DEVARAM M. DHARMAVAT, 1015, SHUKRAWAR PETH, PUNE 411 002 PAN NO.AFXPD2788N . / APPELLANT V/S ITO, WARD-5(4), PUNE . / RESPONDENT . / ITA NOS.1873 TO 1875/PN/2013 '% % / ASSESSMENT YEARS : 2005-06, 2006-07 & 2007-08 SHRI DEVARAM M. DHARMAVAT, 1015, SHUKRAWAR PETH, PUNE 411 002 PAN NO.AFXPD2788N . / APPELLANT V/S ITO, WARD-5(4), PUNE . / RESPONDENT . / ITA NOS.1941 TO 1943/PN/2013 '% % / ASSESSMENT YEARS : 2005-06, 2006-07 & 2007-08 ITO, WARD-5(4), PUNE . / RESPONDENT V/S SHRI DEVARAM M. DHARMAVAT, 1015, SHUKRAWAR PETH, PUNE 411 002 PAN NO.AFXPD2788N . / APPELLANT 2 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 / APPELLANT BY : SHRI S.N. DOSHI / DEPARTMENT BY : SHRI RAJESH DAMOR HEERAJ JAIN & B / ORDER PER R.K. PANDA, AM : ITA NOS. 908 TO 910/PN/2010 FILED BY THE ASSESSEE RELATIN G TO ASSESSMENT YEARS 2007-08, 2006-07 & 2005-06 RESPECTIV ELY ARE RECALLED MATTERS FOR THE LIMITED PURPOSE OF DECIDING CERTAIN ISSUES WHICH REMAINED TO BE ADJUDICATED BY THE TRIBUNAL. ITA N OS. 1873 TO 1875/PN/2013 FILED BY THE ASSESSEE AND ITA NOS. 1941 TO 1943/PN/2013 FILED BY THE REVENUE ARE CROSS APPEALS AND ARE DIREC TED AGAINST THE COMMON ORDER DATED 22-08-2013 OF THE CIT(A )-III, PUNE RELATING TO ASSESSMENT YEARS 2005-06 TO 2007-08 RESPE CTIVELY. FOR THE SAKE OF CONVENIENCE, ALL THESE APPEALS WERE HEARD TOGETHE R AND ARE BEING DISPOSED OF BY THIS COMMON ORDER. ITA NOS. 908 TO 910/PN/2010 (A.YRS. 2007-08, 2006-07 & 2005- 06) : 2. FACTS OF THE CASE, IN BRIEF, ARE THAT THE TRIBUNAL VIDE ORDER DATED 31-03-2011 HAS DECIDED THE APPEAL RELATING TO A.YRS. 2007 -08, 2005- 06 & 2006-07. THE ASSESSEE FILED A MISCELLANEOUS APPLICATION BEFORE THE TRIBUNAL AND THE TRIBUNAL VIDE ORDER DATED 11-06-201 3 IN M.A.NO.80/PN/2011 RECALLED THE ORDER FOR THE LIMITED PURPOSE OF DECIDING THE VALIDITY OF REOPENING U/S.147 FOR A.YRS. 2005-06 AND 2006-07 AND THE ALTERNATE CONTENTION OF THE ASSESSEE R EGARDING / DATE OF HEARING :25.08.2015 / DATE OF PRONOUNCEMENT: 28.08.2015 3 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 PROPORTIONATE DEDUCTION U/S.80IB(10) FOR A.YRS. 2005-06 TO 2007-08 RESPECTIVELY. 3. SO FAR AS THE ISSUE RELATING TO REOPENING OF ASSESSMEN TS FOR A.YRS. 2005-06 AND 2006-07 ARE CONCERNED, THE LD. COUNS EL FOR THE ASSESSEE SUBMITTED THAT THE AO IN THE ORDER PASSED U/ S.143(3) ON 22-12-2006 FOR A.YRS. 2004-05 HAS GRANTED DEDUCTION U/S .80IB(10) IN RESPECT OF THE HOUSING PROJECT CALLED SUNDAR SAHAVAS. HOWEVER, THE AO REOPENED THE ASSESSMENTS FOR A.YRS. 2005-06 AND 200 6-07 WHICH IS NOT CORRECT AND LEGAL DUE TO THE FOLLOWING REASONS : (A) NO REASONS ARE RECORDED FOR ISSUING THE NOTICE U/S.148 F OR BOTH THESE ASSESSMENT YEARS. (B) THE REOPENING IS BASED ON CHANGE OF OPINION AS SIMILAR CLAIM MADE U/S.80IB(10) HAS BEEN ALLOWED IN A.Y. 2004-05 IN THE ASSESSMENT ORDER MADE U/S.143(3). (C) NO NEW TANGIBLE MATERIAL HAS COME IN POSSESSION OF THE AO TO REOPEN THESE COMPLETED ASSESSMENTS ALTHOUGH MADE U/S.143(1). (D) EVEN THE NOTICE DATED 12-11-2007 OF THE PUNE MUNICI PAL CORPORATION CANNOT BE CONSIDERED AS NEW MATERIAL FOR THE OBVIOUS R EASON THAT IN THE SAID NOTICE THE PUNE MUNICIPAL CORPORATION HAS CO NFIRMED THAT THE CONSTRUCTION HAS BEEN COMPLETED AND THE FLATS ARE UNDE R OCCUPATION. 4. HE SUBMITTED THAT ALTHOUGH THE AO IN THE ASSESSMENT ORDER PASSED U/S.143(3) FOR A.Y. 2004-05 HAS ALLOWED THE CLAIM OF DE DUCTION U/S.80IB(10) NO PROCEEDINGS U/S.147 OR 263 HAS BEEN INITIAT ED. RELYING ON VARIOUS DECISION THE LD. COUNSEL FOR THE ASSESS EE SUBMITTED THAT THE REOPENING IS BAD IN LAW AND THEREFORE CANNOT BE UPHELD. HE ALSO RELIED ON THE FOLLOWING DECISIONS : 1. TELCO DADAJEE DHACKJEE LIMITED VS. DCIT ITA NO.46 13/MUM/2005 ORDER DATED 12-05-2010 2. HV TRANSMISSIONS LTD. VS. ITO ITA NO.2230/MUM/2010 ORD ER DATED 07-10-2011. 4 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 5. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER HAN D SUBMITTED THAT AFTER COMPLETION OF THE ASSESSMENT FOR A.Y. 2004-05 CERTAIN FACTS CAME TO THE NOTICE OF THE AO WHICH LED HIM T O INITIATE REASSESSMENT PROCEEDINGS U/S.147/148. HE SUBMITTED THA T DURING THE COURSE OF ASSESSMENT PROCEEDINGS FOR A.Y.2007-08 THE AO MADE ENQUIRIES WITH THE LOCAL AUTHORITY, I.E. PUNE MUNICIPAL CORPORAT ION VIDE HER LETTER DATED 19-06-2008. IN RESPONSE TO THE SAID ENQUIRY, THE DEPUTY CITY ENGINEER PUNE MUNICIPAL CORPORATION VIDE HIS LET TER DATED 21-06-2008 SUBMITTED VARIOUS DETAILS ALONG WITH COPIES OF 2 DOCUMENTS, VIZ., PART COMPLETION CERTIFICATE DATED 16-12-20 06 AND A NOTICE ISSUED BY THE PUNE MUNICIPAL CORPORATION DATED 12- 11-2007 ACCORDING TO WHICH THE PUNE MUNICIPAL CORPORATION HAS ISSU ED ONLY PART COMPLETION CERTIFICATE IN ASSESSEES AFORESAID PROJEC T. FURTHER, THE CERTIFICATE HAS BEEN ISSUED IN RESPECT OF ASSESSEES 06 O UT OF 07 BUILDINGS, I.E. BUILDING NOS. D1 TO D6, COMPLETION CERTIFICATE FOR D 7 BUILDING HAS NOT BEEN GIVEN BY THE PUNE MUNICIPAL CORPORAT ION. FURTHER, THE PUNE MUNICIPAL CORPORATION VIDE LETTER NO.BCO /3579 DATED 12-11-2007 ISSUED A NOTICE TO THE ASSESSEE DIRE CTING HIM TO STOP CONSTRUCTION OF THE PROJECT DUE TO CERTAIN AMBIGUITY IN ULC. THEREFOR E, THE AO HAD SUFFICIENT TANGIBLE MATERIALS FOR ISSUE OF NOTICE U/ S.148 BY REOPENING THE ASSESSMENT U/S.147. FURTHER, THE ASSESSM ENTS FOR A.YRS. 2005-06 AND 2006-07 WERE COMPLETED U/S.143(1). THERE WA S NO APPLICATION OF MIND. THEREFORE, IT CANNOT BE SAID THAT THE SAME IS DUE TO CHANGE OF OPINION. 6. SO FAR AS THE ARGUMENT OF THE LD. COUNSEL FOR THE ASSE SSEE THAT THE REVENUE HAS NOT TAKEN ANY REMEDIAL MEASURES EITHER BY REOPENING THE ASSESSMENT U/S.147 OR ACTION U/S.263 OF THE I.T. AC T, THE LD. 5 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ASSESSE E HAS TO BE BLAMED FOR THIS. HE SUBMITTED THAT THE ASSESSEE HAS DELIB ERATELY FILED THE RETURN OF INCOME BEFORE THE NON-JURISDICTIONAL ASSESSIN G OFFICER WITH A WRONG PAN NUMBER. THEREFORE, THE RETURN WAS NOT READILY TRACEABLE BY THE JURISDICTIONAL ASSESSING OFFICER. HE ACCORD INGLY SUBMITTED THAT THE REASSESSMENT PROCEEDINGS INITIATED BY THE AO BEING IN ACCORDANCE WITH LAW, THE SAME SHOULD BE UPHELD. 7. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDER OF THE AO AND CIT(A) AND THE PAPER B OOK FILED ON BEHALF OF THE ASSESSEE. FROM THE SUBMISSION OF THE LD. COU NSEL FOR THE ASSESSEE AS WELL AS ON PERUSAL OF THE MATERIAL ON RECORD, WE FIND THE ASSESSMENTS FOR A.YRS. 2005-06 AND 2006-07 WERE ADMITTE DLY COMPLETED U/S.143(1). FURTHER, NON-ISSUANCE OF COMPLETION C ERTIFICATE FOR BUILDING NO.D7 OF THE PROJECT AND THE LETTER ISSUED BY PUNE MUNICIPAL CORPORATION DATED 12-11-2007 DIRECTING THE ASSESSEE TO STOP CONSTRUCTION WORK CAME TO THE NOTICE OF THE AO ONLY DU RING THE COMPLETION OF ASSESSMENT PROCEEDINGS FOR A.Y. 2007-08. THE SE DETAILS WERE NOT BEFORE THE AO WHILE COMPLETING THE ASSESSMENT FO R A.Y. 2004- 05. THEREFORE, TANGIBLE MATERIAL HAS COME IN THE HANDS OF T HE ASSESSING OFFICER DURING A.Y. 2007-08 FOR WHICH REMEDIAL MEAS URES WERE TAKEN BY THE ASSESSING OFFICER FOR A.YRS. 2005-06 AND 2006-07 BY REOPENING OF THE ASSESSMENTS. 8. AS REGARDS THE ARGUMENT OF THE LD. COUNSEL FOR THE AS SESSEE THAT NO REASONS ARE RECORDED FOR ISSUE OF NOTICE U/S.148 FOR B OTH THESE ASSESSMENT YEARS, WE FIND FROM THE PERUSAL OF THE ORDER S HEET ENTRIES THAT THE REASONS RECORDED BY THE AO ARE SUFFICIENT FOR R EOPENING OF THE ASSESSMENT. THE ARGUMENT OF THE LD. COUNSEL FOR THE ASS ESSEE THAT 6 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 THE REOPENING IS BASED ON CHANGE OF OPINION IS WITHOUT ANY MERIT SINCE THE ASSESSMENTS FOR A.YRS. 2005-06 & 2006-07 WERE COMP LETED U/S.143(1) AND THEREFORE THERE WAS NO APPLICATION OF MIND BY THE AO. THEREFORE, IT CANNOT BE SAID THAT THE REOPENING OF THE AS SESSMENTS IS BASED ON CHANGE OF OPINION ESPECIALLY WHEN NEW TANGIBLE MA TERIAL HAS COME IN THE POSSESSION OF THE ASSESSING OFFICER. IN THIS VI EW OF THE MATTER, WE ARE OF THE CONSIDERED OPINION THAT THE REOPEN ING OF THE ASSESSMENTS BY THE AO IS VALID. THE GROUNDS RAISED BY T HE ASSESSEE ON THIS ISSUE FOR A.YRS. 2005-06 & 2006-07 ARE ACCORDINGLY DISMISSED . 9. SO FAR AS THE SECOND ISSUE IS CONCERNED, I.E. NON CONSID ERATION OF THE ALTERNATE GROUND RELATING TO PRO-RATA DEDUCTION FOR A.YRS. 2005-06 TO 2007-08, WE HAVE HELD IN THE SUCCEEDING PARAGRAPHS T HAT THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S.80IB(10) IN RESPECT OF T HE ENTIRE HOUSING PROJECT. THEREFORE, THE ABOVE ISSUE RAISED BY THE ASSESSEE BECOMES INFRUCTUOUS AND THEREFORE NEED NO ADJUDICATION B EING ACADEMIC IN NATURE. 10. IN THE RESULT, ALL THE 3 RECALLED MATTERS ARE DISPOSED OF IN THE TERMS INDICATED ABOVE. ITA NOS. 1873/PN/2013 (BY ASSESSEE) & ITA NO.1941/PN/ 2013 (BY REVENUE) (A.Y. 2005-06) : 11. FACTS OF THE CASE, IN BRIEF, ARE THAT THE ASSESSEE FILED THE RETURN OF INCOME FOR A.Y. 2005-06 ON 25-10-2005 DECLARING TOTAL LO SS OF RS.2,04,640/- AFTER CLAIMING DEDUCTION OF RS.1,68,38,012/- U/S.80IB(10) OF THE I.T. ACT. THE AO DISALLOWED THE CLAIM MA DE U/S.80IB(10) ON THE GROUND THAT THE ASSESSEE HAS NOT F ULFILLED THE CONDITIONS LAID DOWN IN THE PROVISIONS OF SECTION 80IB(10). T HE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A) WHO DISMISS ED THE 7 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 APPEAL OF THE ASSESSEE. ON FURTHER APPEAL FILED BY THE ASS ESSEE THE TRIBUNAL VIDE ORDER DATED 31-03-2011 RESTORED THE ISSUE OF ALLOWABILITY OF DEDUCTION U/S.80IB(10) TO THE FILE OF THE AO WITH A DIRECT ION TO EXAMINE THE ASSESSEES CLAIM IN THE LIGHT OF THE DECISION OF THE TRIBUNAL IN THE CASE OF SATISH BORA AND ASSOCIATES VIDE IT A NOS. 713 & 714/PN/2010 ORDER DATED 07-01-2011. THE AO ACCORDING LY ISSUED NOTICE TO THE ASSESSEE ASKING HIM TO EXPLAIN AS TO WHY T HE DEDUCTION U/S.80IB(10) SHOULD NOT BE DISALLOWED. IT WAS SUBMITTED BY THE ASSESSEE THAT AFTER SUBMISSION OF THE COMPLETION CERTIFICATE BY THE ARCHITECT, THE PUNE MUNICIPAL CORPORATION DID NOT RAISE ANY OBJECTION WITHIN THE TIME PERIOD OF 21 DAYS FROM THE DATE OF FILING OF TH E APPLICATION. THE ASSESSEE HAS COMPLETED THE ENTIRE PROJE CT AND PART COMPLETION CERTIFICATE FOR BUILDING NOS. D1 TO D6 ARE ALREADY ISSUED BY PMC. THE COMPLETION CERTIFICATE FOR BUILDING NO.D7 IS AWAITED. IT WAS SUBMITTED THAT THE ALLEGED MAJOR PROBLEM RELATING TO ULC MATTER HAS BEEN FOUND TO BE INCORRECT AND NOT AT ALL IN EXISTENCE DU E TO THE ORDER OF THE HONBLE HIGH COURT WHICH QUASHED THE INITIATION OF R EVISIONAL PROCEEDINGS U/S.34. 12. SO FAR AS THE OBJECTION OF THE AO THAT THE DECISION O F THE TRIBUNAL IN THE CASE OF SATISH BORA AND ASSOCIATES HAS NO T BEEN ACCEPTED BY THE DEPARTMENT AND AN APPEAL HAS BEEN FILED , IT WAS ARGUED THAT UNTIL AND UNLESS THE SAID ORDER IS REVERSED BY THE JURISDICTIONAL HIGH COURT, THE DECISION OF THE TRIBUNAL IS BIND ING ON THE DEPARTMENT. 13. HOWEVER, THE AO WAS NOT SATISFIED WITH THE EXPLANATION GIVEN BY THE ASSESSEE FOR THE FOLLOWING REASONS : 8 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 5.1 THE HONBLE MUMBAI HIGH COURT HAS QUASHED THE OR DER OWING TO THE INORDINATE DELAY IN INITIATION OF THE PROCEEDIN GS AND NOT ON MERITS. 5.2 IT IS CLEAR THAT THE PMC RAISED ITS OBJECTION AND MUCH BEYOND THE STIPULATED PERIOD OF 21 DAYS FROM THE RECEIPT OF THE APPLICATION FOR THE COMPLETION CERTIFICATE AND THUS FULFILS THE CONDITION LAID DOWN IN RULE 7.7 OF THE DEVELOPMENT CONTROL (DC) RULES OF THE PMC, AS FAR THE TIME LIMIT IS CONCERNED. HOWEVER THE OBJECTION RAISED BY THE PMC V IDE LETTER DATED 25.10.2007 WAS A MAJOR OBJECTION WHEREBY THE NOTICE FOR STOPPING THE CONSTRUCTION WAS GIVEN. 5.3 IT IS A FACT THAT IT WAS THE LAND OWNER WHO FILED A WRIT PETITION. THE ASSESSEE IS A PARTY AS AN INTERVENER. HOWEVER THE ASSESSEE'S ARGUMENT THAT IS NO DISPUTE OF THE TITLE OF THE HOUSING PROJECT, SIN CE THE ASSESSEE HAS ONLY TAKEN DEVELOPMENT RIGHTS, IS NOT FULLY ACCEPTABLE. IT IS TO BE APPRECIATED THAT THE ASSESSEE, AS A PROMOTER AND BUILDER, HAS AN ONER OUS RESPONSIBILITY TO NOT ONLY HAVE THE FSI CONVEYED TO THE FLAT OWNER S BUT ALSO THE CONVEYANCE OF THE LAND TO THE PROPOSED SOCIETY IN WHI CH THE FLAT OWNERS ARE MEMBERS. IT IS IN THIS CONTEXT THAT THE ASSESSEE'S ROL E IN THE HOUSING PROJECT' IS REQUIRED TO BE SEEN AND EXAMINED. IN VIEW OF THE SAME, IT IS CLEAR THAT THE OBJECTION THOUGH RAISED LATE BY THE P MC IS A MAJOR ONE AND HENCE IS CLEARLY DISTINGUISHABLE FROM THE OBJECTIONS OF A MINOR NATURE RAISED IN THE CASE OF M/S. SATISH BORA AND ASSOCIATES. 5.4 AS PER THE PROVISIONS OF SEE 80 IB(10), IN ORDER TO ALL OW THE CLAIM, ONE OF THE PRIME CONDITIONS IS THAT THE CONSTRUCTION I N RESPECT OF WHICH THE DEDUCTION IS CLAIMED HAS TO BE COMPLETED WITHIN FOUR YEARS FROM THE END OF THE FINANCIAL YEAR IN WHICH THE HOUSING PROJECT I S APPROVED BY LOCAL AUTHORITY. IN THE PRESENT CASE, THE PROJECT HAS COMMEN CED IN THE FINANCIAL YEAR 2003-04. THAT MEANS THE SCHEME SHOULD HAVE BEEN C OMPLETED BY 31/03/2008. HOWEVER, THE LOCAL AUTHORITY I.E. PUNE MUNICIPAL CORPORATION HAS NOT ISSUED THE COMPLETION CERTIFICATE TO THE SAID PROJECT. IT WAS INITIALLY COMMUNICATED BY THE LOCAL AUTHORITY TH AT NO COMPLETION CERTIFICATE HAS BEEN GRANTED TO THE SAID PROJECT. HOW EVER, SUBSEQUENTLY THEY INFORMED THAT ONLY PART COMPLETION CERTIFICATE I.E. IN RESPECT OF BUILDINGS D-L TO D-6 HAVE BEEN ISSUED BY THEM. FURTHER , THE ASSESSEE HAS ALSO ADMITTED VIDE HIS LETTER DATED 07 / 12/2009 THE FACT THAT COMPLETION CERTIFICATE HAS BEEN ISSUED IN RESPECT OF SIX OUT OF SEV EN BUILDINGS ONLY AND THE SAME HAS NOT BEEN ISSUED BY THE LOCAL AUTHORITY FOR THE SEVENTH BUILDING. IT IS VERY MUCH CLEAR FROM PMCS LETTER DATED 05/11 /2012 THAT THE ASSESSEE HAS NOT RECEIVED THE COMPLETION C ERTIFICATE FROM THE LOCAL AUTHORITY AS YET. AS PART COMPLETION CERTIFICATE CANNOT BE TERMED AS COMPLETION CERTIFICATE IN RESPECT OF ENTIRE HOUSING PROJECT. ALTHOUGH THE PMC VIDE LETTER DATED 05.11.2012 HAS STATED THAT THE CITY ENGINEER, PMC HAS ACCORDED APPROVAL TO VACATE THE NOTICE ISSUED ON 25.10.2007 PURSUANT TO THE RECEIPT OF THE ORDER OF THE HONBLE BOMBAY H IGH COURT, THE FACT OF THE MATTER REMAINS THAT THE PMC HAS STILL NOT ISSUED THE FINAL COMPLETION CERTIFICATE TO THE ASSESSEE TILL THE DATE OF PASSING TH IS ORDER. THE LETTER DATED 05.11.2012 FROM THE PMC CLEARLY STATES THAT THE PROCEEDING IN RESPECT OF ISSUE OF FINAL COMPLETION IS STILL ON. AS SUCH THE ASSESSEE HAS VIOLATED THE PROVISIONS STIPULATED IN EXPLANATION(II) TO SECTION 80IB(10)(A) OF THE ACT. 9 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 5.5 THE TAX INCENTIVE BY WAY OF DEDUCTION U/S. 80IB( 10) IS PREDOMINANTLY FOR THE PURPOSE OF AUGMENTING AFFORDABLE DWELLING UN ITS; NOT WITHSTANDING LEGISLATURE'S UNAMBIGUOUS OBJECTIVE OF INTRODUCING TAX BENEFITS UNDER SEC. 80IB(10) FOR AUGMENTING AVAILABILITY OF DWELLING UN ITS FOR LOW AND MIDDLE CLASS. IF THIS IS THE INTENTION OF THE LEGISLATURE, THE HOUSING PROJECT IN RESPECT OF WHICH 80IB(10) CLAIM IS TO BE MADE, SHOULD BE FREE FROM ALL TRIBULATIONS I.E, THE PROJECT SHOULD BE FREE FROM ALL TECHNO-LEGAL ASPECTS. THEREFORE, EVEN IF FOR SOME TECHNICAL PROBLEMS, AS IN THE CASE OF THE ASSESSEE, THE PROJECT DO NOT GET COMPLETION CERTIFICATE , THE INTENT OF LEGISLATURE GETS DEFEATED. THE PROVISION OF SECTION 80I B(10) IS A BENEFICIAL PROVISION TO THE ASSESSEE. HOWEVER, THE CONDITIONS STIPUL ATED FOR GETTING THE DEDUCTION NEEDS TO BE FULFILLED STRICTLY . IN THE PRESENT CASE, THOUGH THE ASSESSEE FULFILLS THE OTHER REQUISITE CONDITIONS, THE COND ITION REGARDING THE COMPLETION OF THE PROJECT WITHIN THE STIPULATED PERI OD, MAY BE DUE TO SOME TECHNICAL REASONS, HAS NOT BEEN FULFILLED BY THE ASSESSEE AND THEREFORE THE ASSESSEE'S CLAIM FOR DEDUCTION U/S.. 80IB(10) FAILS. 5.6 IT IS PERTINENT TO MENTION THAT THE DEPARTMENT H AS PREFERRED APPEAL TO THE HIGH COURT U/S 260A, BOTH, IN THE CASE OF SATISH BORA & ASSOCIATES AS WELL AS IN THE INSTANT CASE. THEREFORE THE UNDERSIGNED IS CONSTRAINED TO FOLLOW THE STAND TAKEN BY THE DEPARTMENT AND ALSO FOR THE REASONS ENUMERATED ABOVE. 5.7 THEREFORE, WITH DUE RESPECT TO THE DIRECTIONS OF THE HONBLE ITAT PUNE A BENCH AND FOR THE DISCUSSIONS ENUMERATED ABOVE , THE ENTIRE CLAIM U/S.80IB(10) OF THE ASSESSEE FOR YEAR UNDER CONSIDERATION IS HEREBY DISALLOWED. 14. IN APPEAL THE LD.CIT(A) GRANTED THE PRO-RATA DEDUCTIO N, I.E. ALLOWED THE CLAIM OF DEDUCTION U/S.80IB(10) IN RESPECT OF BUI LDING NOS. D1 TO D6. HE HOWEVER DENIED THE CLAIM OF DEDUCTION U/S.80 IB(10) IN RESPECT OF BUILDING NO. D7. THE RELEVANT OBSERVATION OF THE LD.CIT(A) AT PARA 4.6 TO 5 OF THE ORDER READ AS UNDER : 4.6. I HAVE CONSIDERED THE SUBMISSIONS OF THE APPELLANT AND THE CONTENTION OF THE ASSESSING OFFICER IN REJECTING THE C LAIM FOR DEDUCTION U/S 80IB(10). IN THE SUBSEQUENT SET ASIDE PROCEEDINGS, TH E ASSESSING OFFICER CARRIED OUT CERTAIN ENQUIRIES FROM THE PMC W HEREIN HE LEARNED THAT THE APPELLANT HAD APPLIED FOR COMPLETION CERTI FICATE ON 17.05.2006 FOR 07 BUILDINGS WHERE AS THE PMC HAD ISSUED PART COMPL ETION FOR 06 BUILDINGS ON 16.12.2006. THE OBJECTION RAISED BY PMC VIDE LETTER DATED 25.10.2007 WAS APPROVED TO BE VACATED BY THE CITY EN GINEER, PMC FOLLOWING THE BOMBAY HIGH COURT DECISION ON 30.06.20 10. THE PMC IN THE LETTER DATED 05. 11.2012 ADDRESSED TO THE ASSESSING O FFICER STATED IN RESPONSE TO SPECIFIC QUESTION AS TO WHETHER A COMPL ETION CERTIFICATE HAD BEEN ISSUED IN RESPONSE TO THE APPLICATION MADE BY THE ASSESSEE, THAT 'THE PROCEEDINGS IN RESPECT OF ISSUE OF COMPLETION CERTIFICATE IN RESPECT OF BUILDING NO. 07 IS IN PROGRESS.' THE ASSESSING O FFICER RELIED UPON THIS OBSERVATION OF PMC TO HOLD THAT THE COMPLET ION CERTIFICATE 10 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 FROM THE LOCAL AUTHORITY AS REQUIRED UNDER THE INCOM E TAX ACT HAD NOT BEEN GRANTED TO THE APPELLANT'S PROJECT. FURTHER, HE ALSO HELD THAT UNLIKE SATISH BORA CASE, WHICH INVOLVED CONSTRUCTION O F UNAUTHORIZED WATCHMAN SHED, UNAUTHORIZED PARKING SHED, NON-AVAILAB ILITY OF DP USE CERTIFICATE AND FINAL FIRE 'NOC', UNAUTHORIZED USE AND VARIATION IN ACTUAL WORK ON SITE AND AS PER PLAN ETC., IN THE APPELLANT'S CASE, THE ISSUE INVOLVED RELATED TO THE USER OF LAND IN DISREGARD OF THE ULC ACT, WHICH IS A SERIOUS OFFENCE INVOLVING THE LEGALITY OF THE TIT LE OF THE LAND, LEADING TO THE POSSIBILITY OF RAZING DOWN UNAUTHORIZED CONSTRU CTION THEREON. THE ASSESSING OFFICER ALSO NOTED THAT THE DEPARTMENT HAD NOT ACCEPTED THE DECISION OF THE ITAT, PUNE IN THE CASE OF SATISH B ORA AND ASSOCIATES AND HAD FILED A REFERENCE BEFORE THE HIGH COURT IN THAT CASE. 4.7 THE APPELLANTS SUBMISSION IS THAT THE ASSESSING OFFICER HAS TRAVELLED BEYOND THE CONFINES PRESCRIBED BY THE ITAT IN EXAMINING THE FACTS TO SEE IF SATISH BOAR CASE IS APPLICABLE. THIS SUBM ISSION IS NOT FOUND TO BE CORRECT. IN THE SATISH BORA DECISION THE ITAT HELD IN THE CONCLUDING PARA 19.2 THAT IN CASE OF SMALL OBJECTIONS RAISED BY PMC AFTER EXPIRY OF DEEMING PERIOD OF 21 DAYS UNDER RULE 7.7 OF DC RULES, THE DATE OF RECEIVING DEEMING SANCTION, I.E. DATE OF OCCUPANCY CERTIFICATE WOULD MEET THE REQUIREMENTS OF EXPLANATI ON (II) OF SEC.80IB(10)(A). THE RELEVANT PARA READS AS UNDER : SINCE INTACT 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 PA RAGRAPHS HAVE COME TO A CONCLUSION THAT IN CASE OF SMALL OBJECTIONS O F 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) CERTIFICATE TO MEET OUT THE REQUIREMENT OF EXPLANAT ION (II) TO SECTION 80IB(10)(A) OF THE ACT. WE HAVE ALREADY DISC USSED HEREIN ABOVE WHAT WOULD BE THE SMALL OBJECTIONS. IN BRIEF T HOSE OBJECTIONS WHICH DO NOT AFFECT THE MAIN PROJECT AND ARE GENERALLY TEMPORARY CONSTRUCTIONS. ' 4.8 IN THE PRESENT CASE, ADMITTEDLY, THE APPLICATION FOR ISSUANCE OF COMPLETION CERTIFICATE (OCCUPANCY CERTIFICATE) WAS M ADE TO THE PMC ON 17-05-2006 AND THE PMC ISSUED PART COMPLETION CERTIFI CATE FOR 06 BUILDINGS, I.E. NOS. D-1 TO D-6 ON 16.12.2006. THE O BJECTION CERTIFICATE OF THE PMC DIRECTING THE APPELLANT TO STOP ALL WORK VID E ITS LETTER DATED 12.11.2007 WAS RECEIVED ALMOST A YEAR LATER. THIS LET TER PUT AN IMMEDIATE HALT TO THE CONSTRUCTION ACTIVITY BEING UNDERTAKEN A T THE APPELLANTS SUNDER SAHAWAS PROJECT. AS ALREADY STATED ABOVE THI S LETTER OF PMC WAS ISSUED IN VIEW OF THE MAJOR VIOLATION RELATING TO THE FSI AS WELL AS IRREGULAR CONSTRUCTION CARRIED OUT ON LANDS DECLARED AS SURPLUS VA CANT LAND. HOWEVER, THE BOMBAY HIGH COURT HAS SUBSEQUENTLY INTERV ENED AND QUASHED THE REVISIONAL ORDER OF THE COLLECTOR U/S.34 O F THE URBAN LAND (CEILING & REGULATION) ACT, 1976 ON THE GROUND OF I NORDINATE DELAY AND ALSO QUASHED THE PENALTY LEVIED AT THE RATE MENTIONED IN THE READY RECKONER RATE FOR REGULARIZING THE CONSTRUCTION ON SU RPLUS VACANT LAND. THE APPELLANTS CASE IS THAT BY REASON OF THE ORDER OF THE BOMBAY HIGH COURT REFERRED TO ABOVE, PMC HAS VACATED THE SAID NO TICE DATED 12.11.2007 THEREBY MAKING IT CLEAR THAT THERE IS NO SO CALLED MA JOR VIOLATION. 11 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 THEREFORE, IT IS SEEN THAT ALTHOUGH THE WORK STOPPAGE ORDER ISSUED BY PMC INVOLVED THE MISUSE OF ULC PROVISION BY CERTAIN DEVELO PERS AND THE GRANT OF FSI ON SURPLUS VACANT LANDS BY THE REVENUE AND MUN ICIPAL AUTHORITY, THIS ORDER OF PMC HAS BEEN QUASHED BY HIGHER COURT FOLLOWI NG WHICH THE ORDER HAS BEEN VACATED BY PMC. 4.9. THE FACTS STATED ABOVE, MAKE IT CLEAR THAT IT IS NOT A CASE OF 'SMALL OBJECTIONS' WHICH HAVE BEEN SPELT OUT BY THE ITAT IN THE SATISH BORA CASE BUT RELATE TO A MAJOR OBJECTION WHICH HAS BEEN CONSEQ UENTLY WITHDRAWN BY THE MUNICIPAL/LOCAL AUTHORITY. AT THE SAME TIME THE PMC HAS YET TO ISSUE THE OCCUPANCY (COMPLETION) CERTIFICATE IN RESPEC T OF BUILDING D-7 AS PER THEIR LETTER DATED 05.11.2012 ADDRESSED TO THE ASSE SSING OFFICER. HENCE, IT CANNOT BE CONSIDERED THAT THE REQUIREMENT OF SEC 80IB(10)(A)(I) R/W EXPLANATION (II) HAS BEEN MET IN VIEW OF THIS, IT IS SEEN THAT THE DIRECTIONS LAID DOWN BY THE ITAT, PUNE ARE FOUND TO HAVE BEEN APPROPRIATELY FOLLOWED AND APPLIED BY THE ASSESSING OFF ICER, KEEPING IN VIEW THE RATIO OF SATISH BORA CASE. ACCORDINGLY, IT I S HELD THAT THE ASSESSING OFFICER HAS CORRECTLY APPRECIATED THE CAVEATS LAID DO WN IN SATISH BORA CASE AFTER EXAMINING THE FACTUAL ASPECTS OF THE APPELLANT' S CASE. 4.10. THE ALTERNATIVE CONTENTION OF THE APPELLANT I S THAT DEDUCTION U/S 80IB10) MAY BE ALLOWED IN RESPECT OF THE SIX BUILDING S WHICH ARE ADMITTEDLY COMPLETED BEFORE 31.03.2008. RELIANCE HA S BEEN PLACED ON THE FOLLOWING DECISIONS OF ITAT, PUNE AT BOMBAY HIGH COUR T : A) M/S. VANDANA PROPERTIES ITA NO. 3633 OF 2009 - BOMBAY HIGH COURT - DATED 28/03/2012. B) RUNWAL MULTI HOUSING PVT. LTD. - ITA NO. 1015 TO 101 7/PN/2011 DECIDED ON 21/11/2012 - PUNE BENCH. C) M/S. RAHUL CONST ITA NO. 1250/PN/2009 & 707/PN /2010 FOR AY. 2006-07 & 2007-08 DATED 30/03/2012 D) MAGARPATTA TOWNSHIP DEVELOPMENT & CONSTRUCTION CO. DE CIDED ON 18/09/2012 - PUNE HON'BLE ITAT E) M/S. RAMSUKH PROPERTIES VS. DCIT - PUNE BENCH - ITA NO. 84/PN/2011 FOR AY 7007 -08 DATED 25/07/2012 4.11 HAVING CONSIDERED AND PERUSED THE DECISION OF THE JURISDICTIONAL HIGH COURT AND ITAT, PUNE AND FOLLOWING THE PRECEDE NT OF JUDICIAL DISCIPLINE, THE ALTERNATE CONTENTION OF THE APPELLAN T THAT DEDUCTION U/S.80IB(10) SHOULD BE ALLOWED IN RESPECT OF THE 06 BU ILDINGS WHICH WERE ADMITTEDLY COMPLETED BEFORE 31.03.2008, IS FOUND ACC EPTABLE. ACCORDINGLY, GROUND NO.1 TO 3 ARE HELD TO BE PARTLY ALLOWED. 5. UNNUMBERED GROUND OF APPEAL IS A RESIDUAL GROUND A ND SAYS THAT APPELLANT BE ALLOWED TO ADD, AMEND, ALTER OR DELETE ANY GROUND OF APPEAL AT THE TIME OF APPELLATE PROCEEDINGS. SINCE OPTION HAS BEEN EXERCISED BY THE APPELLANT DURING THE APPELLATE PROCEEDINGS TO FILE A DDITIONAL GROUND WHICH STANDS ADMITTED AND ADJUDICATED, THIS GROUND OF APPEA L IS TAKEN TO BE ALLOWED. 12 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 15. AGGRIEVED WITH SUCH ORDER OF THE CIT(A) THE ASSESSEE AS WELL AS THE REVENUE ARE IN APPEAL BEFORE US WITH THE FOLLOWING GROUNDS : GROUNDS BY ASSESSEE : 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE T HE CIT(A) HAS ERRED IN UPHOLDING THE VALIDITY OF REOPENING OF THE ASSESSMENT U/S.147 WITHOUT APPRECIATING THE FACT THAT THERE HAS NOT BE EN ANY NEW TANGIBLE MATERIAL POSSESSED BY THE AO JUSTIFYING THE REOPENING OF THE ASSESSMENT. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AN D WITHOUT PREJUDICE TO ABOVE GROUND, THE CIT(A) HAS ERRED IN N OT ALLOWING THE CLAIM MADE U/S.80IB(10) FOR THE ENTIRE HOUSING PROJECT. THE ABOVE GROUNDS OF APPEAL MAY KINDLY BE ALLOWED TO BE ALTERED, MODIFIED, AMENDED, ETC IN THE INTEREST OF NATURAL JU STICE. GROUNDS BY REVENUE : 1. THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX ( APPEALS) IS CONTRARY TO THE LAW AND FACTS AND CIRCUMSTANCES OF THE CASE. 2. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) HAS NOT APPRECIATE THAT THE ASSESSEE HAS FAILED TO OBTAIN COMPLETION CERTIF ICATE OF THE HOUSING PROJECT 'SUNDER SAHWAS' BEFORE 31.03.2008 AS REQUIRE D UNDER EXPLANATION (II) TO SEC. 80IB(10) OF THE I. T. ACT. THE SAID COM PLETION CERTIFICATE HAS NOT BEEN OBTAINED EVEN TILL DATE OF ASSESSMENT ORDER 18.12. 2009. 3. THE LD. COMMISSIONER OF INCOME-TAX (APPEALS) ERRED ON FACTS AND IN LAW, IN ALLOWING THE DEDUCTION U/S 80IB(10) WHEN THE ASSESSEE HAD COMPLETED ONLY SIX BUILDING OUT OF 7 BUILDING, THE P LAN WAS APPROVED BY LOCAL AUTHORITY FOR 7 BUILDINGS THUS THE ASSESSEE VIOLA TED THE PROVISION OF SUB SECTION (II) OF CLAUSE (A) TO SECTION 80IB(10) OF T HE ACT, 1961. 4. FOR THESE AND SUCH ABOVE OTHER GROUNDS AS MAY BE URG ED AT THE TIME OF THE HEARING, THE ORDER OF THE LEARNED CIT(A PPEALS) MAY BE VACATED AND THAT OF THE ASSESSING OFFICER BE RESTORED. 5. THE APPELLANT CRAVES, LEAVE TO ADD, AMEND, ALTER OR DELETE ANY OF THE ABOVE GROUND OF APPEAL DURING THE COURSE OF THE APPE LLANT PROCEEDINGS BEFORE THE ITA T. 16. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THER E IS NO DISPUTE THAT IN RESPECT OF 6 BUILDINGS PUNE MUNICIPAL CORPOR ATION HAD GRANTED THE OCCUPANCY CERTIFICATE ON 16-12-2006. SO FAR AS THE PROFIT IN RESPECT OF THE 7 TH BUILDING IS CONCERNED, I.E. BUILDING NO.D7 THE TRIBUNAL IN THE EARLIER ORDER WHILE DECIDING THE APPEAL HAS IN PRINCIPLE 13 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 HELD THAT THE PROFIT IN RESPECT OF THE ENTIRE HOUSING PROJ ECT INCLUDING THE 7 TH BUILDING IS ELIGIBLE FOR DEDUCTION U/S.80IB(10). THE HONBLE TRIBUNAL, HOWEVER, REQUIRED THE AO TO VERIFY THE CORRECT NESS OF THE ADDITIONAL EVIDENCES FILED BEFORE THE TRIBUNAL. THE DECISION O F THE TRIBUNAL WAS MISCONSTRUED BY THE AO WHO AGAIN CONFIRMED THE DISALLOWANCE OF DEDUCTION U/S.80IB(10) IN RESPECT OF THE EN TIRE HOUSING PROJECT. SINCE THE ASSESSEE HAD PRODUCED THE OCCUPAN CY CERTIFICATE FROM THE PUNE MUNICIPAL CORPORATION VIDE CERTIFICATE DATED 16-12-2006 THE CIT(A) ALLOWED PRO-RATA DEDUCTION IN RESPECT OF THE PR OFIT FROM THE 6 BUILDINGS. HE HOWEVER HAS DENIED THE BENEFIT OF DEDUCT ION U/S.80IB(10) IN RESPECT OF BUILDING NO.D7. THE LD. COUNSEL FOR T HE ASSESSEE SUBMITTED THAT THE PUNE MUNICIPAL CORPORATION W HILE ISSUING NOTICE DATED 12-11-2007 DIRECTING THE ASSESSEE TO STOP THE CONSTRUCTION WORK HAS ITSELF MENTIONED IN THE SAID LETTER THAT CONSTRUCTION OF ALL THE BUILDINGS IS COMPLETED AND THESE ARE UNDER OCCUPATION. HE SUBMITTED THAT SINCE CONSTRUCTION OF ALL TH E BUILDINGS HAVE BEEN COMPLETED THE ASSESSEE SHOULD BE ALLOWED THE DEDUCTION U/S.80IB(10) IN RESPECT OF THE PROFITS OF THE ENTIRE PROJEC T FOR ALL THE 3 ASSESSMENT YEARS. 17. HE FURTHER SUBMITTED THAT THE PROJECT HAS BEEN SAN CTIONED ON 22-12-2003, I.E. PRIOR TO 01-04-2005. REFERRING TO THE DEC ISION OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. CHD DEVEL OPERS LTD. REPORTED IN 362 ITR 177 HE SUBMITTED THAT THE HONBLE HIGH COURT IN THE SAID DECISION HAS HELD THAT AMENDMENT W.E.F. 01-04-2005 REQUIRING CERTIFICATE OF COMPLETION OF PROJECT WITHIN 4 YEARS OF APPROVAL IS NOT APPLICABLE TO PROJECTS APPROVED PRIOR TO THAT DAT E. ACCORDINGLY, THE ORDER OF THE TRIBUNAL ALLOWING CLAIM OF DEDUCTION U/S.80IB (10) WAS 14 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 UPHELD AND THE APPEAL FILED BY THE REVENUE WAS DISMISSED. REFERRING TO THE DECISION OF THE PUNE BENCH OF THE TRIBUNAL IN THE C ASE OF SYSTEM ENTERPRISES VS. ITO VIDE ITA NO.1123/PN/2013 ORDER DATE D 28-08- 2014 HE SUBMITTED THAT THE TRIBUNAL FOLLOWING THE ABOVE DE CISION OF HONBLE DELHI HIGH COURT HAS HELD THAT SINCE THE DATE O F COMMENCEMENT OF THE PROJECT IN THAT CASE IS ADMITTEDLY 16-07-2002, THEREFORE, THE AMENDMENT W.E.F. 01-04-2005 REQUIRING THE CE RTIFICATE OF COMPLETION OF PROJECT WITHIN 4 YEARS OF APPROVAL IS NOT AP PLICABLE TO THE PROJECT APPROVED PRIOR TO THAT DATE. IT WAS ACCORD INGLY HELD THAT THE ASSESSEE IS ENTITLED TO CLAIM DEDUCTION U/S.80IB(10) OF THE I.T. ACT. 18. AGAIN, REFERRING TO THE DECISION OF THE TRIBUNAL IN THE CA SE OF M/S. SATISH BORA AND ASSOCIATES (SUPRA) BASED ON WHICH T HE TRIBUNAL HAD RESTORED THE ISSUE TO THE FILE OF THE AO FOR CERTAIN V ERIFICATIONS HE SUBMITTED THAT THE SOCALLED MAJOR DEVIATIONS AS POINTED O UT BY THE AO AND CIT(A) ON THE BASIS OF THE NOTICE ISSUED BY THE PUNE MUNICIPAL CORPORATION DATED 12-11-2007 DOES NOT EXIST BECAUSE T HE SAID NOTICE HAS BEEN VACATED BY THE ORDER OF HONBLE BOMBAY HIGH COURT ON A WRIT PETITION FILED BY THE LAND OWNERS AS WELL AS CIVIL APPLICATION FILED BY THE ASSSESSEE. HE SUBMITTED THAT THE PUNE MUNICIPAL COR PORATION BY ITS LETTER DATED 09-09-2010 VACATED THE NOTICE DATED 1 2-11-2007 SUGGESTING VERY CLEARLY THAT EVEN THE SOCALLED DISCREPAN CY NEVER EXISTED ON THE SAID DATE. HE SUBMITTED THAT IN THE INSTA NT CASE THE LICENSED ARCHITECT FILED THE APPLICATION DATED 17-05-2006 ALO NG WITH THE COMPLETION CERTIFICATE FOR PROVIDING OCCUPANCY CERTIFICATE FOR ALL THE 7 BUILDINGS. THE PMC GRANTED OCCUPANCY CERTIFICATE ON 16- 12-2006 FOR 6 BUILDINGS AND NOTHING OBJECTIONABLE WAS HEARD IN RESPECT OF THE 7 TH BUILDING. HE SUBMITTED THAT AS PER RULE 7 OF DEVELOPMENT C ONTROL 15 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 RULES IF NOTHING IS RECEIVED WITHIN 21 DAYS FROM THE DATE OF FILING THE APPLICATION AND NO MAJOR VIOLATION IS FOUND IN THE CONSTRUCT ION COMPLETED, IT HAS TO BE HELD THAT THERE IS DEEMED COMPLETION/OCCUPANCY CERTIFICATE. FOR THE ABOVE PROPOSITIO N, HE RELIED ON THE DECISION OF THE PUNE BENCH OF THE TRIBUNAL IN THE CASE OF M/S. SATISH BORA AND ASSOCIATES (SUPRA). 19. THE LD. DEPARTMENTAL REPRESENTATIVE ON THE OTHER H AND HEAVILY RELIED ON THE ORDER OF THE AO. HE SUBMITTED THAT SINCE T HE ASSESSEE HAS NOT PRODUCED THE COMPLETION CERTIFICATE FOR THE BUILDI NG NO.D7, THEREFORE, IN VIEW OF THE PROVISIONS OF SECTION 80IB(10) TH E ASSESSEE IS NOT ENTITLED TO THE BENEFIT OF DEDUCTION U/S.80IB(10) FOR THE ENTIRE PROJECT. 20. AS REGARDS THE ORDER OF THE CIT(A) GIVING PRO-RATA DE DUCTION IN RESPECT OF 6 BUILDINGS IS CONCERNED HE SUBMITTED THAT TH ERE IS NO CONCEPT OF PRO-RATA DEDUCTION UNDER PROVISIONS OF SECTION 80IB(10). THE ASSESSEE HAS TO COMPLETE CONSTRUCTION OF THE ENTIRE HOUSING PROJECT AND IS DUTY BOUND TO OBTAIN AND PRODUCE THE C OMPLETION CERTIFICATE WITHIN THE PRESCRIBED TIME FOR AVAILING OF THE BENE FIT. HE SUBMITTED THAT UNLESS THE ASSESSEE OBTAINS THE COMPLETIO N CERTIFICATE FROM THE PUNE MUNICIPAL CORPORATION WITHIN THE STIPULATED TIM E, THE VERY BASIS FOR WHICH THE PROVISION WAS INSERTED WILL BE LOST. HE ACCORDINGLY SUPPORTED THE ORDER OF THE AO AND SUBMITTE D THAT THE GROUNDS RAISED BY THE ASSESSEE BE DISMISSED AND THE GR OUNDS RAISED BY THE REVENUE BE ACCEPTED. 21. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY BOTH THE SIDES, PERUSED THE ORDER OF THE LD.CIT(A) AND THE PAPER BOOK FILED ON BEHALF 16 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 OF THE ASSESSEE. WE HAVE ALSO CONSIDERED THE VARIOUS DE CISIONS CITED BEFORE US. WE FIND IN THE INSTANT THE ASSESSEE CARRIED O UT CONSTRUCTION OF A HOUSING PROJECT CALLED SUNDAR SAHAVAS AND CLAIMED DEDUCTION U/S.80IB(10) OF THE ACT WITH RESPECT TO THE PROFITS EARNE D FROM THE ENTIRE PROJECT. THE PLAN IN RESPECT OF THE SAID HOUSING P ROJECT WAS SANCTIONED BY THE LOCAL AUTHORITY ON 22-12-2003. ACCORD ING TO THE AO, IN TERMS OF PROVISIONS OF SECTION 80IB(10) OF THE ACT THE AS SESSEE WAS REQUIRED TO COMPLETE THE CONSTRUCTION ON OR BEFORE 31-03-2008 IN ORDER TO AVAIL THE DEDUCTION U/S.80IB(10) OF THE ACT. SINCE THE COMPLETION CERTIFICATE HAD BEEN ISSUED ONLY IN RESPECT OF 6 OUT OF T HE 7 BUILDINGS ON 16-12-2006 AND SINCE ON 12-11-2007 THE LOCAL AUTHOR ITY HAD ISSUED A NOTICE TO THE ASSESSEE DIRECTING HIM NOT TO CAR RY OUT FURTHER CONSTRUCTION WORK ON THE PROJECT AS THERE WAS CERTAIN AMBIGUITIES UNDER THE URBAN LAND CEILING ACT, THEREFORE, THE ASSESSEE IS NOT ENTITLED TO THE BENEFIT OF DEDUCTION U/S.80IB(10). ACCORDING TO THE AO, AS PER EXPLANATION (II) TO SECTION 80IB(10) THE DATE OF COM PLETION OF THE HOUSING PROJECT SHALL BE THE DATE ON WHICH THE COMPLETION CERTIFICATE IN RESPECT OF SUCH HOUSING PROJECT IS ISSUED BY THE LOCAL AU THORITY. ACCORDING TO THE AO, THE PROVISIONS OF SECTION 8IB(10) IS A BENEFICIAL PROVISION TO THE ASSESSEE AND THEREFORE THE CONDITIONS S TIPULATED FOR GETTING THE DEDUCTION NEED TO BE FULFILLED STRICTLY. IN THE INSTANT CASE, THOUGH THE ASSESSEE FULFILS THE OTHER REQUISITE CONDITIONS, T HE CONDITION REGARDING THE COMPLETION OF THE PROJECT WITHIN THE STIPULA TED PERIOD HAS NOT BEEN FULFILLED BY THE ASSESSEE AND THEREFORE NO D EDUCTION U/S.80IB(10) CAN BE GIVEN TO THE ASSESSEE. AS REGARDS T HE RELIANCE ON THE DECISION OF THE TRIBUNAL IN THE CASE OF M/S. SATISH BOR A AND ASSOCIATES (SUPRA) IS CONCERNED, THE AO HELD THAT SINCE TH E 17 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 DEPARTMENT IS IN APPEAL BEFORE THE HONBLE HIGH COURT, THE REFORE, THE SAME CANNOT BE FOLLOWED. 22. WE FIND IN APPEAL THE LD.CIT(A) ALLOWED THE CLAIM OF PRORAT A DEDUCTION IN RESPECT OF THE 6 BUILDINGS WHICH WERE ADMITTE DLY COMPLETED BEFORE 31-03-2008. WHILE DOING SO, HE RELIED ON V ARIOUS DECISIONS OF THE TRIBUNAL AND THE DECISION OF THE HONBLE HIG H COURT IN THE CASE OF M/S. VANDANA PROPERTIES (SUPRA). IT IS THE S UBMISSION OF THE LD. COUNSEL FOR THE ASESSEE THAT EVEN THE BUILDING NO .D7 WAS ALSO COMPLETED. THE OWNERS WERE GIVEN POSSESSION OF THE FLATS. HOWEVER, THE COMPLETION CERTIFICATE WAS NOT ISSUED BY THE PUNE MUN ICIPAL CORPORATION DUE TO CERTAIN OBJECTIONS. HOWEVER, IN VIEW O F THE DECISION OF HONBLE BOMBAY HIGH COURT VIDE ORDER DATED 30-06-201 0 THE SAID OBJECTIONS RAISED BY THE PMC HAVE BEEN VACATED AND TH E PMC HAS ALREADY ISSUED THE COMPLETION CERTIFICATE. IT IS ALSO THE SU BMISSION OF THE LD. COUNSEL FOR THE ASSESSEE THAT IN VIEW OF THE DEC ISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CHD DEVELOPERS LT D. (SUPRA) THE ASSESSEE IS NOT REQUIRED TO PRODUCE THE COMPLETION CERTIFICATE TO AVAIL THE DEDUCTION U/S.80IB(10) IN RESPECT OF A HOUSING PRO JECT WHICH HAS BEEN APPROVED PRIOR TO 01-04-2005. 23. WE FIND MERIT IN THE ABOVE ARGUMENT OF THE LD. COUNSE L FOR THE ASSESSEE. ADMITTEDLY, THE PROJECT HAS BEEN SANCTIONED BY THE LOCAL AUTHORITY ON 22-12-2003 VIDE COMMENCEMENT CERTIFICATE NO.1071/2003 DATED 22-12-2003, A COPY OF WHICH IS PLACED AT PAGE 126 OF THE PAPER BOOK. THERE IS ALSO NO DISPUTE TO THE FA CT THAT THE OCCUPANCY CERTIFICATE FOR 6 BUILDINGS NAMELY D1 TO D6 WAS ISSUED BY PMC VIDE CERTIFICATE DATED 16-12-2006, A COPY OF WHICH IS P LACED AT PAGE 54 OF THE PAPER BOOK. FROM THE NOTICE DATED 12-1 1-2007 ISSUED 18 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 BY PMC DIRECTING THE ASSESSEE TO STOP THE CONSTRUCTION WORK, WE FIND PMC IN THE SAID LETTER ITSELF HAS ALSO MENTIONED THAT ALL TH E BUILDINGS ARE CONSTRUCTED AND ARE UNDER OCCUPATION. THE LETTER ISSUED BY PMC ON 12-11-2007 DIRECTING THE ASSESSEE TO STOP THE CONS TRUCTION WORK HAS BEEN VACATED BY THE HONBLE BOMBAY HIGH COURT VIDE ORDER DATED 30-06-2010. THE RELEVANT OBSERVATION OF THE HONBLE HIGH COURT AT PARA 3 AND 4 READS AS UNDER : 3. IN SO FAR AS CHALLENGE TO THE REVISIONAL ORDER ON AFORESAID GROUNDS OF INORDINATE DELAY AND THE LEVY OF PENALTY IS CONCE RNED, THE SAID ISSUE IS NO MORE RES-INTEGRA AND IS CONCLUDED BY A JUDGMENT O F A DIVISOIN BENCH OF THIS COURT DATED 6 TH MAY, 2010, ( TO WHICH ONE OF US P.B. MAJUMDAR, J W AS A PARTY) IN WRIT PETITION NO.153 OF 2008 IN THE MATTE R OF ANIL NEMICHAND BAFNA AND ORS VS. STATE OF MAHARASHTRA AND ANR. BY TH E SAID JUDGMENT, THE REVISIONAL ORDER IN THE SAID CASE WAS QUASHED ON THE GR OUND OF THERE BEING INORDINATE DELAY IN INITIATING THE SAID REVISIONAL PR OCEEDINGS AS ALSO ON THE GROUND THAT THE REVISIONAL AUTHORITY COULD NOT HAVE ISSUED DIRECTIONS OF LEVYING PENALTY AT THE RATE MENTIONED IN THE READY RECKONER FOR REGULARIZING THE CONSTRUCTION ON THE SURPLUS VACANT LA ND. 4. SINCE IN THE INSTANT CASE REVISIONAL PROCEEDINGS WE RE INITIATED AFTER A PERIOD OF ABOUT FIVE YEARS, FOR THE VIEW THAT THE DIVISION BENCH OF THIS COURT HAS TAKEN IN THE JUDGMENT (SUPRA), THE ABOVE P ETITION IS REQUIRED TO BE ALLOWED AND IS ACCORDINGLY ALLOWED IN TERMS OF PR AYER CLAUSE (B). RULE IS ACCORDINGLY MADE ABSOLUTE IN THE ABOVE TERMS. THEREFORE, NOW THE QUESTION THAT ARISES IS AS TO WHETHER WHERE THE PROJECT IS APPROVED PRIOR TO 01-04-2005 AND THE ASSES SEE HAS COMPLETED THE HOUSING PROJECT CONSISTING OF 7 BUILDINGS AND HAS OBTAINED THE OCCUPANCY CERTIFICATE FOR 6 BUILDINGS AND THE LOCAL AUTHORITY HAS NOT ISSUED THE COMPLETION CERTIFICATE FOR THE 7 TH BUILDING, THEN IN THAT CASE, DEDUCTION U/S.80IB(10) BE ALLOWED OR NOT . IN OTHER WORDS, WHETHER PRODUCTION OF COMPLETION CERTIFICATE IS REQUIR ED IN SUCH A CASE WHERE THE PROJECT HAS BEEN APPROVED PRIOR TO 01-04-200 5. 24. WE FIND AN IDENTICAL ISSUE HAD COME UP BEFORE THE TRIBU NAL IN THE CASE OF SYSTEM ENTERPRISES VIDE ITA NO.1123/PN/2013 ORDER DATED 28-08-2014 FOR A.Y. 2009-10. THE TRIBUNAL FOLLOWING THE DECIS ION OF 19 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 HONBLE DELHI HIGH COURT IN THE CASE OF CHD DEVELOPERS LTD .(SUPRA) AND THE DECISION OF HONBLE KARNATAKA HIGH COURT IN THE C ASE OF M/S ITTINA PROPERTIES PVT. LTD. VIDE ITA NO.556/PN/2013 AND B ATCH OF OTHER APPEALS ORDER DATED 15-07-2014 HAS HELD THAT AMENDMEN T W.E.F. 01- 04-2005 REQUIRED COMPLETION CERTIFICATE OF PROJECT WITHIN 4 YEARS OF APPROVAL IS NOT APPLICABLE TO THE PROJECTS APPROVED PRIO R TO THAT DATE AND THEREFORE THE ASSESSEE IS ENTITLED TO DEDUCTION U/S.8 0IB(10) OF THE I.T. ACT. THE RELEVANT OBSERVATION OF THE TRIBUNAL FROM P ARA 10 ONWARDS READ AS UNDER : 10. WE HAVE CONSIDERED THE RIVAL ARGUMENTS MADE BY B OTH THE SIDES, PERUSED THE ORDERS OF THE ASSESSING OFFICER AND THE CIT(A ) AND THE PAPER BOOK FILED ON BEHALF OF THE ASSESSEE. WE HAVE ALSO CONSI DERED THE VARIOUS DECISIONS CITED BEFORE US. WE FIND THE ASSESSING OFFICER IN THE INSTANT CASE DENIED THE BENEFIT OF DEDUCTION U/S.80IB(10) ON 4 CO UNTS (A) THE HOUSING PROJECT LAST SANCTIONED WAS FOR THE CONSTRUCTION OF 65 UNITS WHICH HAS NOT BEEN COMPLETED IN THE STIPULATED TIME FRAME, (B) TH E BUILT UP AREA OF 2 ROW HOUSES 1 & 7 ARE MORE THAN 1500 SQ.FT. EACH (C) THE HO USING PROJECT WAS REQUIRED TO BE COMPLETED IN TOTALITY AND NOT INDIVI DUAL FLATS AND (D) THE CONDITION LAID DOWN IN SECTION (A) AND (B) OF 80IB(1 0) OF THE ACT WAS NOT FULFILLED. 10.1 SO FAR AS THE FIRST 2 OBJECTIONS ARE CONCERNED, W E FIND THE LD.CIT(A) HAS DECIDED THE ABOVE ISSUES IN FAVOUR OF THE ASSESSEE. WE FIND THE CIT(A) HAS HELD THAT THE SIZE OF THE PROJECT COMPRISE OF 63 U NITS ONLY WHICH INCLUDED 56 FLATS AND 7 ROW HOUSES WHICH COULD QUALITY FOR THE CLAIM OF DEDUCTION U/S.80IB(10) AND NOT 65 UNITS AS HELD BY THE ASSESSING OFFICER (PARA 3.6 OF THE ORDER). SIMILARLY, HE HAS HELD THA T THE AREA OF THE 2 UNITS, I.E. 1 & 7 ARE LESS THAN 1500 SQ.FT. AFTER EXCLUDING T ERRACE, BALCONY AND PROJECTIONS ETC., AND THEREFORE THE 2 UNITS FULFIL CO NDITIONS PRESCRIBED U/S.80IB(10)(14)(A) OF THE I.T. ACT. THE ABOVE OBSER VATIONS OF THE LD.CIT(A) ARE NOT CHALLENGED BY THE REVENUE AND THE REFORE IT HAS ATTAINED FINALITY AND THEREFORE WE ARE NOT CONCERNED WITH TH E ABOVE OBJECTIONS OF THE ASSESSING OFFICER. 10.2 THE OTHER GROUND ON WHICH THE ASSESSING OFFICER BA SED HIS REJECTION OF DEDUCTION U/S.80IB(10) IS THAT THE ASSESSEE HAS NOT BEEN ABLE TO OBTAIN THE REQUISITE COMPLETION CERTIFICATE/OCCUP ANCY CERTIFICATE WITHIN THE TIME LIMIT PRESCRIBED IN THE PROVISIONS OF SECTION 80IB(10) FOR ALL THE FLATS/UNITS WHICH IN THE INSTANT CASE IS 31-03-2008 AND THE ASSESSEE HAS OBTAINED THE CERTIFICATE ONLY ON 31-10-2009 WHICH I S BEYOND THE STIPULATED DATE. WE FIND THE ASSESSING OFFICER AS WELL A S THE CIT(A) HAS GIVEN A CATEGORICAL FINDING THAT THE DATE OF COMMEN CEMENT OF THE PROJECT AS 16-07-2002. IN OTHER WORDS, THE HOUSING PROJECT W AS APPROVED BEFORE 31-03-2004 AND THEREFORE ACCORDING TO BOTH OF THEM THE PROJECT SHOULD HAVE BEEN COMPLETED BEFORE 31-03-2008. 20 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 10.3 WE FIND THE HONBLE DELHI HIGH COURT IN THE CA SE OF CHD DEVELOPERS LTD. (SUPRA) HAS OBSERVED AS UNDER (SHORT NOTES) : SECTION 80-IB(10) OF THE INCOME-TAX ACT, 1961, BEF ORE SUBSTITUTION BY THE FINANCE (NO. 2) ACT, 2004 ALLOWED A HUNDRED PER CEN T, DEDUCTION OF THE PROFITS IN THE CASE OF AN UNDERTAKING DEVELOPING AND BUILDING HOUSING PROJECTS APPROVED BEFORE MARCH 31, 2005, BY A LOCAL AUTHORITY. BY THE FINANCE (NO. 2) ACT, 2004, WITH EFFECT FROM APRIL 1 , 2005, THE CONDITIONS FOR GRANT OF DEDUCTION WERE THAT IN A CASE WHERE A HOUSIN G PROJECT IS APPROVED BY THE LOCAL AUTHORITY BETWEEN APRIL 1, 2004 AND MA RCH 31, 2005, THE PROJECT SHOULD BE COMPLETED WITHIN FOUR YEARS FROM TH E END OF THE FINANCIAL YEAR IN WHICH IT IS APPROVED BY THE LOCAL AUTHORITY. CLAUSE (II) OF THE EXPLANATION PROVIDED THAT THE DATE OF COMPLETIO N 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 AUTHORITY. THE ASSESSEE, A REAL ESTATE DEVELOPER, OBTAIN ED APPROVAL FOR A HOUSING PROJECT ON MARCH 16, 2005, FROM THE DEVELOPM ENT AUTHORITY. IT COMPLETED THE PROJECT IN 2008 AND BY LETTER DATED N OVEMBER 5, 2008 APPLIED TO THE COMPETENT AUTHORITY FOR THE ISSUE OF T HE COMPLETION CERTIFICATE. FOR THE ASSESSMENT YEAR 2007-08, ITS CLAIM TO DEDUCTION UNDER SECTION 80-IB(10) OF THE INCOME-TAX ACT, 1961 WAS DEN IED INTER ALIA, ON THE GROUND THAT THE ASSESSEE HAD VIOLATED THE CONDITIONS STIP ULATED UNDER SEC- TION 80-IB(10) INASMUCH AS IT HAD NOT OBTAINED THE CO MPLETION CERTIFICATE FOR THE PROJECT FROM THE COMPETENT AUTHORITY WITHIN FOUR YEARS AS STIPULATED IN EXPLANATION (II) THERETO. THE COMMISSION ER (APPEALS) UPHELD THE ASSESSMENT ORDER. THE TRIBUNAL HELD THAT THE ASSESSEE W AS EXPECTED TO COMPLETE THE PROJECT IN ACCORDANCE WITH THE APPROVE D PLAN AT A PARTICULAR POINT OF TIME AND THE ASSESSEE WAS NOT EXPECTED TO DO OR TO FULFIL THE CONDITIONS WHICH WERE NOT IN EXISTENCE AT THE RELEVAN T POINT OF TIME OR MADE COMPULSORY BY AMENDMENT IN THE ACT FROM THE FUT URE DATE. SINCE THE ASSESSEE WAS TO COMPLETE THE PROJECT ON OR BEFORE MARCH 31, 2009, AND A REQUEST WAS DULY MADE WITH THE COMPETENT AUTHORITY ON NOVEMBER 5, 2008, MENTIONING THAT THE PROJECT HAD BEEN COMPLETE D AND THE COMPLETION CERTIFICATE MAY BE ISSUED AND IF THE CERTIFICATE WAS N OT ISSUED BY THE COMPETENT AUTHORITY THE ASSESSEE SHOULD NOT BE PENALISED THEREFORE UNLESS AND UNTIL SOME CONTRARY FACTS WERE BROUGHT ON RECORD EVIDENCING THAT THE ASSESSEE CONTRAVENED THE CONDITIONS CONTAINED IN THE APP ROVAL GRANTED BY SUCH COMPETENT AUTHORITY. HOWEVER, SINCE THE APPROVAL WAS GRANTED TO THE ASSESSEE ON APRIL 1,2005, THE ASSESSEE WAS NOT EXPECTED TO F ULFIL THE CONDITIONS WHICH WERE NOT ON THE STATUTE WHEN SUCH AP PROVAL WAS GRANTED TO THE ASSESSEE. THE TRIBUNAL ACCEPTED THE ASSESSEE'S CLAI M TO DEDUCTION UNDER SECTION 80-IB(10). ON APPEAL: HELD, DISMISSING THE APPEAL, THAT THE APPROVAL FOR THE PROJECT WAS GIVEN BY THE DEVELOPMENT AUTHORITY ON MARCH 16, 2005. CLEARL Y THE APPROVAL RELATED TO THE PERIOD PRIOR TO 2005, I.E., BEFORE T HE AMENDMENT, WHICH INSISTED ON ISSUANCE OF THE COMPLETION CERTIFICATE BY T HE END OF THE FOUR- YEAR PERIOD, WAS BROUGHT INTO FORCE. THE APPLICATION OF SUCH STRINGENT CONDITIONS, WHICH ARE LEFT TO AN INDEPENDENT BODY SUC H AS THE LOCAL AUTHORITY WHO IS TO ISSUE THE COMPLETION CERTIFICATE, WOULD HAVE LED TO NOT ONLY HARDSHIP BUT ABSURDITY. AS A CONSEQUENCE, THE TRIB UNAL WAS NOT, THEREFORE, IN ERROR OF LAW WHILE HOLDING IN FAVOUR OF THE ASSESSEE. 21 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 10.4 WE FIND THE HONBLE KARNATAKA HIGH COURT IN TH E CASE OF M/S.ITTINA PROPERTIES PVT. LTD. (SUPRA) WHILE DECIDING AN IDENT ICAL ISSUE HAS OBSERVED AS UNDER (PARA 4/PAGE 6 OF THE ORDER): 4. INSOFAR AS QUESTION NOS. 3 AND 4 ARE CONCERNED, IT RELATES TO THE ASSESSEE COMPLYING WITH THE REQUIREMENTS PROVIDED UNDER SUB-SEC.(1) OF SEC.80 IB BEFORE IT COULD CLAIM THE BENEFIT PROVIDE D UNDER SEC. 80 IB. THE SAID PROVISION CAME ON THE STATUTE BOOK BY FINANCE ACT 2004, WITH EFFECT FROM 1/4/2005. THE PLAN WHICH IS SANCTIONED IN THIS CA SE IS OF 16/3/2004 I.E., PRIOR TO THE SAID PROVISION COMING INTO FORCE. THIS COURT IN MORE THAN ONE CASE HAS HELD THAT THE SAID PROVISION IS PROSPECTIVE IN NATURE AND IT HAS NO APPLICATION TO HOUSE PRODUCTS WHICH WAS APPROVED BY THE LOCAL AUTHORITY PRIOR TO 1/4/2005. IN THAT VIEW OF THE MA TTER, THE BENEFIT UNDER SEC. 80 IB CANNOT BE DENIED TO THE ASSESSEE ON THE GROU ND THAT HE DOES NOT COMPLY WITH THE TERMS OF SEC.80 IB(10). 5. IT IS SUBMITTED ON BEHALF OF THE ASSESSEE THAT THEY HA VE COMPLIED WITH THE SAID STATUTORY REQUIREMENT ALSO. AS THE SAID PROVISION HAS NO APPLICATION TO THE FACTS OF THE CASE, THE QUESTION OF GOING TO THE QUESTION WHETHER THOSE STATUTORY REQUIREMENTS HAVE BEEN COMPLIE D WITH OR NOT, WOULD NOT ARISE AND THE TRIBUNAL RIGHTLY EXTENDED TH E SAID BENEFIT. IN THAT VIEW OF THE MATTER, WE DO NOT SEE ANY MERIT IN THE A PPEALS AND THE SAID QUESTIONS OF LAW ARE ANSWERED IN THE SENSE THAT THE SAID PROVISION HAS NO APPLICATION TO THE FACTS OF THIS CASE. 10.5 SINCE THE DATE OF THE COMMENCEMENT OF THE PROJ ECT IN THE INSTANT CASE IS ADMITTEDLY 16-07-2002 AS HELD BY THE ASSESSING OF FICER AS WELL AS THE CIT(A), THEREFORE, RESPECTFULLY FOLLOWING THE DE CISIONS CITED (SUPRA) IT HAS TO BE HELD THAT AMENDMENT W.E.F. 01-04-2005 REQU IRING CERTIFICATE OF COMPLETION OF PROJECT WITHIN 4 YEARS OF APPROVAL IS N OT APPLICABLE TO THE PROJECTS APPROVED PRIOR TO THAT DATE AND THEREFORE T HE ASSESSEE IS ENTITLED TO DEDUCTION U/S.80IB(10) OF THE I.T .ACT. 10.6 SINCE THE ASSESSEE SUCCEEDS ON THIS LEGAL GROUND, WE REFRAIN OURSELVES FROM ADJUDICATING THE OTHER GROUNDS RAISED BY THE ASSESSEE SINCE THESE BECOME ACADEMIC IN NATURE 11. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS AL LOWED. 25. SINCE IN THE INSTANT CASE THE PROJECT HAS BEEN APPR OVED PRIOR TO 01-04-2005 AND THE ASSESSEE HAS ADMITTEDLY COMPLETED CONSTRUCTION OF ALL THE 7 BUILDINGS, THEREFORE, THE DENIAL OF DEDUCTION U/S.80 IB(10) FOR NON PRODUCTION OF COMPLETION CERTIFICATE FOR THE 7 TH BUILDING IS NOT JUSTIFIED IN VIEW OF THE DECISION OF THE PUNE BENCH OF THE TR IBUNAL CITED (SUPRA). IN VIEW OF THE ABOVE DECISION, THE ASSESSEE IS NOT REQUIRED AT ALL TO SUBMIT THE COMPLETION CERTIFICATE SINCE THE PROJECT HAS ADMITTE DLY BEEN APPROVED PRIOR TO 01-04-2005. THEREFORE, THE CLAIM O F DEDUCTION 22 ITA NOS.908 TO 910/PN/2010, ITA NOS. 1873 TO 1875/PN/2013 & ITA NOS. 1941 TO 1943/PN/2013 U/S.80IB(10) IN RESPECT OF ALL THE 7 BUILDINGS IN OUR OPINION HA S TO BE ALLOWED TO THE ASSESSEE. WE HOLD AND DIRECT ACCORDINGLY. IN VIEW OF OUR ABOVE FINDINGS, THE GROUNDS RAISED BY THE REVENUE C HALLENGING THE PRO-RATA DEDUCTION GRANTED BY THE CIT(A) BECOME INFRUCT UOUS AND ARE DISMISSED. 26. SINCE THE SAME PROJECT IS CONTINUING FOR A.YRS. 2006-07 & 2007- 08, THEREFORE, FOLLOWING OUR ABOVE DECISION, THE GROUNDS RAISE D BY THE ASSESSEE FOR A.YRS. 2006-07 & 2007-08 ARE ALSO ALLOWED A ND THE GROUNDS RAISED BY THE REVENUE FOR THE ABOVE 2 ASSESSM ENT YEARS ARE DISMISSED. 27. IN THE RESULT, ITA NOS. 908 TO 910/PN/2010 FILED BY TH E ASSESSEE ARE PARTLY ALLOWED. ITA NOS. 1873 TO 1875 FILED BY THE AS SESSEE ARE ALLOWED AND ITA NOS. 1941 TO 1943/PN/2013 FILED BY THE RE VENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 28-08-2015. SD/- SD/- ( VIKAS AWASTHY ) ( R.K. PANDA ) ' / JUDICIAL MEMBER / ACCOUNTANT MEMBER PUNE ; DATED : 28 TH AUGUST, 2015. ( )'+ , / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. & ( ) , / THE CIT(A)-III, PUNE 4. & / THE CIT-III, PUNE 5. 6. ) ,,-, -, / DR, ITAT, A PUNE; 1 / GUARD FILE. / BY ORDER , ) , ) , //TRUE COPY// 34 , - / SR. PRIVATE SECRETARY -, / ITAT, PUNE