Joint Commissioner of Income-Tax (OSD), Cen Cir 2(4), Pune V. M/s Sable Assocites, Pune

ITSSA 9/PUN/2021

AI Insights

The case involves the Income Tax Department's appeal against the decision of the Commissioner of Income Tax (Appeals), which allowed the deduction under section 80IB(10) to M/s. Sable Associates for the assessment year 2013-14. The main contention by the Revenue was that the projects for which the deductions were claimed were not completed within the stipulated time and that the projects should be considered as a single project due to a common layout plan. The assessee argued that the projects were distinct and completed within the statutory time limits. The Tribunal examined the facts, including the commencement and completion certificates, and the layout plans, and found in favor of the assessee.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 134444 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 1 month(s) 22 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 27-09-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 30-05-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 05-08-2021
• Other Referred Cases: Pr. CIT vs Abhisar Buildwell P. Ltd., Kewal Real Estate (P.) Ltd vs DCIT, Rahul Construction Co vs ITO, Aditya Developers vs DCIT, Parmar Properties Pvt Ltd vs DCIT, Dilip Kumar & Co vs State
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Question of law; Documents seized; Set aside
• Section: 132; 143(3); 153A; 80IB; 113; 13; 119; 22

Judgement Text

आयकर अपीलीय अिधकरण ”बी” Ɋायपीठ पुणेमŐ। IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES “B” :: PUNE BEFORE SHRI PARTHA SARATHI CHAUDHURY, JUDICIAL MEMBER AND DR. DIPAK P. RIPOTE, ACCOUNTANT MEMBER आयकर अपील सं. / IT(SS)A No.09/PUN/2021 िनधाᭅरण वषᭅ / Assessment Year :2013-14 The Jt.Commissioner of Income Tax (OSD), Central Circle-2(4), Pune. Vs M/s.Sable Associates, CTS No.2134, Adhishthan, Final Plot No.32B/24, Vijaynagar Colony, Sadashiv Peth, Pune – 411030. PAN: AAZFS 7254 F Appellant/ Revenue Respondent /Assessee Cross Objection No.36/PUN/2022 (Arising out of IT(SS)A No: 09/PUN/2021) िनधाᭅरण वषᭅ / Assessment Year :2013-14 M/s.Sable Associates, CTS No.2134, Adhishthan, Final Plot No.32B/24, Vijaynagar Colony, Sadashiv Peth, Pune – 411030. PAN: AAZFS 7254 F Vs The Jt.Commissioner of Income Tax (OSD), Central Circle-2(4), Pune. Appellant/ Assessee Respondent / Revenue Assessee by Shri.Nikhil Pathak Revenue by Shri.Sardar Singh Meena,IRS CIT(DR) Dates of hearing 12/5/2023,16/05/2023,17/05/2023,18/05/2023, 31/05/2023 Date of pronouncement 28/08/2023 IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 2 आदेश/ ORDER PER DR. DIPAK P. RIPOTE, AM: This appeal filed by the Revenue and Cross Appeal of Assessee are directed against the common order ofld.Commissionerof Income Tax (Appeal),[ld.CIT(A)], Pune-12 dated 31.05.2021 for AY 2009-10 onwards emanating from separate assessment orders. Also, the assessee is before us as a Cross- Objector for the aforementioned year. All these appeals and cross objections were heard together . 2. The Revenue has raised the following grounds of appeal for AY 2013-14 : “1) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing assessee’s claim of deduction u/s.80IB(10) of the Act of Rs.5,35,13,272/- when the assessee had not completed the project by 31.03.2009 thus violating the provisions of section 80IB(10)(a)(ii) of the Act and also violated the condition mandated in clause (c) to section 80IB(10) of the Act. 2) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in holding Shivsagar City and Shivsagar Residency as two distinct housing project without appreciating the fact that E building (Shivsagar Residency) is an extension of the earlier housing project (Shivsagar City) for which approval was granted on 06.07.2004 and also not considering that the revision /redesigning of the plan is one of the frequent occurrence of any project claiming deduction u/s. 80IB(10). 3) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in holding Shivsagar City ( containing buildings A,B,C and D) and Shivsagar Residency ( containing buildings E1-E5) as two distinct housing project and allowing the decutio u/s 80IB (10) without appreciating the findings of the Assessing Officer, based on documents obtained from Pune Municipal Corporation, wherein the note prepared by the Building Inspector and approved by the Assistant Engineer clearly states IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 3 that E building (Shivsagar Residency) is an extension of / addition to the earlier single housing project (Shivsagar City). 4) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing the proportionate deduction u/s.80IB(10) of the Act even when the Ld.CIT(Appeals) had accepted that the assessee had violated mandatory condition of clause (c) to section 80IB(10) of the Act by combining two flat units into a single unit and exceeding the mandatory limits of 1500sq.ft. 5) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing assessee’s claim of deduction u/s.80IB(10) when the assessee had violated the provisions of clause (f) to section 80IB(10) of the Act by resorting to sale of more than one unit to members of the same family. 6) Whether on the facts and the circumstances of the case, the Ld. CIT(A) was justified in not appreciating the fact that if the conditions set out in section 80IB(10) are satisfied, then deduction is allowable on the entire project approved by the local authority and there is no question of allowing proportionate deduction to a part of the project? 7) Whether on the facts and the circumstances of the case, the Ld. CIT(A) was justified in not appreciating the fact that there is no provision for allowing proportionate deduction in section 80IB(10)? 8) On the facts and circumstances of the case and in law, the Ld.CIT(Appeals) erred in allowing the undisclosed cash expenses of Rs.35,14,000/- against the undisclosed cash receipts of Rs.1,25,36,000/- without appreciating the fact that the assessee has not been able to establish the nexus of the undisclosed cash expenses with the cash receipts either before the Hon. ITSC or the AO and hence failed to discharge the onus of establishing that the expenses have been incurred for the purpose of business. 9) The appellant craves leave to add, alter or amend any or all the grounds of appeal.” 3. In the Cross Objection Appeal, the Assessee has raised the following grounds of appeal for AY 2013-14 : “1. On the facts and circumstances of the case and in law, the learned CIT(Appeals) has erred in accepting the Revenue’s allegation that, in respect of two flats (namely Flat No. C- IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 4 2/503 and Flat No. C-2/504 in the housing project Phase-I Shivsagar City) the Assessee has breached the maximum area limit of 1500 sq. ft. prescribed under section 80-IB(10) of the Act by combining the said flats into a single unit whose combined area was 1770 sq. ft., without appreciating that there is a separate sale agreement for each flat and such flats are separate even as per the completion certificate issued by the local authority. 2. On the facts and circumstances of the case and in law, the learned CIT(Appeals) has erred in treating the unaccounted cash receipts of Rs. 1,25,36,000 noted in the seized diary of Mr. Sanjay Sable as business income but allowing deduction for only selective entries of expenditure amounting to Rs. 35,14,000 out of total business expense of Rs. 54,34,100 noted in the same seized diary, thereby confirming disallowance of Rs. 19,20,100. The Assessee craves leave to add, alter, delete, substitute or modify any of the cross-objections urged above.” 4. Brief facts of the case : The assessee filed Original Return of Income for A.Y.2013-14 on 29.09.2013 declaring total income of Rs.Nil. The assessee claimed deduction under section 80IB(10) of Rs.5,35,13,271/-. The assessee’s case for A.Y.2013-14 was selected for scrutiny. However, the scrutiny proceedings were abated as search under section 132 of the Act was conducted on 12.11.2014 before completion of assessment proceedings. The AO i.e. Deputy Commissioner of Income Tax, Central Circle-2(4), Pune issued notice under section 153A of the Act. The assessee requested Assessing Officer(AO) to treat the Return filed under section IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 5 139(1) as Return filed in response to notice under section 153A of the Act. The AO passed an order under section 153A r.w.s 143(3) on 30.11.2018 for A.Y. 2013-14 disallowing assessee’s claim of deduction under section 80IB(10) of the Act and also made an addition of Rs.1,25,36,000/-. 4.1) As per the Assessment Order and CIT(A)’s order, the Sable Waghire Group is a Pune based group mainly engaged in the manufacture of bidis, food products etc. It has also expanded in the construction business through the assessee firm and other concerns. The assessee is a firm engaged in the business of Promoters & Builders. It has carried out projects such as Shivsagar City, Shivsagar Residency etc in the Sinhgad Road area of Pune. The firm is in existence since 15/01/2004. There are 9 partners in the firm and 8 of the partners are from the Sable family whereas the ninth partner is Shri Atul MogaL. In the action u/s 132 of the I T Act at the office premises of the assessee firm cash of Rs.1,68,000/- and jewellery valued at Rs 4,25,154/- was found. Statements u/s 132(4) of the Income Tax Act of Shri Atul Vijay Mogal,Shri Sudhir S Sable were recorded during the search.In the post search proceedings statements of certain flat holders/customers of the assessee firm were recorded. IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 6 4.3) In the meanwhile, the assessee firm filed an application u/s 245C(1) of the I T Act on 30/06/2016 before the Hon’ble Income Tax Settlement Commission, Mumbai for Assessment Years 2009-10 to 2015-16 offering additional income of Rs.361.68 lakhs in aggregate for all the years. The assessee firm paid the taxes on the additional income disclosed. The Hon’ble ITSC, Mumbai passed order u/s245D(4) dated 6/12/2017 rejecting the application of the Assessee without deciding the terms of the settlement. Submission of ld.Authorised Representative (ld.AR) : 5. The Ld.AR filed written submission which is reproduced as under : 1.2] The Assessee submits that it had purchased land at S. No. 17, at VadgaonBudruk, Taluka Haveli, Dist. Pune, admeasuring 68,900 sq. mts. (approx. 17 acres) on 12/04/2004. Thereafter, the Assessee obtained building plan permission on 06/07/2004 for 17 buildings namely, A1 - A9, B1 - B3, C1-C2 and D1-D3. The Assessee has treated these 17 buildings as Phase -I and has called them as Shivsagar City project. There are total 474 flats in these 17 buildings. The Assessee received completion certificate from PMC for these 17 buildings on 06/06/2007 and 16/07/2007. The relevant completion certificates are given on pages 69 and 70 of the Paper Book - Vol. I. 1.3] The Assessee partly offered the income from these 17 buildings in AY 2008-09 and partly in AY 2009-10. The assessment for AY 2008-09 was completed u/s. 143(3) allowing the claim of the Assessee. Similarly, the assessment for AY 2009-10 wascompleted u/s. 143(3) accepting the claim of the Assessee. The copy of the assessment order for AY 2009-10 is enclosed on pages 117-119 of the Paper Book - Vol. I. 1.4] It is to be noted that subsequently, the Assessee received building plan permission for Phase-II comprising of 5 IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 7 buildings E1-E5. The Assessee has considered these 5 buildings as Phase-II and called the same as Shivsagar Residency project. The building plan permission for these 5 buildings was first received on 26/03/2007. For AY 2009-10, the Assessee along with the return of income had filed audit report in Form 10CCB. The copy of the same is on pages 124- 128 of the Paper Book - Vol. I. In the said audit report, the Assessee had clearly stated that it is constructing two separate projects, Phase-I and Phase-II. On Page 126 of the Paper Book, the Assessee had pointed out that the commencement date for Phase I was 06/07/2004 and for Phase II was 26/03/2007. The Assessee had also clarified that Phase-I was completed and Phase-II was not complete. The point to be appreciated is that the Assessee had duly clarified in the audit report that it is constructing 2 separate projects, namely Phase-I and Phase-II, and the relevant building plans along with commencement certificates and the completion certificates were duly submitted by the Assessee. 1.5] In the course of assessment proceedings u/s. 153A for AY 2009-10, the Assessee had objected to the disallowance u/s. 80IB(10) on the ground that no incriminating document was seized in the course of Search and hence, no disallowance could be made in the assessment u/s. 153A. The Ld. AO has discussed this issue in Para (a) on Page 14 of the assessment order. The Ld. AO has stated that in the course of Search, certain documents were seized vide Bundle no. 1 from the office premises of the assessee at Adhisthan building. He further states that the documents seized are in the form of commencement certificates, occupation certificates and other documents related to the projects in respect of which deduction u/s. 80IB(10) was claimed. The Ld. AO admits that none of these documents constitute incriminating document. However, according to him, the combined reading of the documents brings out the fact that the original commencement certificate and the subsequent commencement certificate being modifications cast a doubt on the claim made by the assessee. Accordingly, he has stated that the combined reading of the documents seized make the documents incriminating. 1.7] The Assessee submits that the disallowance made by the Ld. AO is not justified at all. At the outset, it is to be appreciated that the Ld. AO in Para (a), page 14, has stated that certain documents were seized in the course of Search. Firstly, the Ld IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 8 AO gives a positive finding that none of the documents seized constitute incriminating material. The description of the various documents seized vide Bundle no. 1 is given on pages 120-123 of the Paper Book Vol-I. Basically, most of the documents are copies of Index-II in respect of the flats sold by the assessee and the other documents are in the form of commencement certificate and completion certificate which are already on record. Accordingly, none of these documents constitute incriminating evidence. It is to be also noted that the Ld AO in his order has proceeded to make a disallowance even without pointing out as to which document constitute incriminating evidence. In the absence of any such document being pointed out by the AO, the question of holding any incriminating evidence was found as a result of Search simply does not arise. 1.8] Further, the commencement certificates and completion certificates were already available with the erstwhile AO while conducting the original assessment proceedings u/s. 143(3) prior to the Search action. Thus, the fact that the assessee was developing the housing projects in phases, ie. Phase-I and Phase-II, and building plan approval for the Phase-II mentioned ‘Revised’ on it, was already known to the Department at the time of conducting the original assessment proceedings. Accordingly, the contention of the AO in the assessment order passed u/s. 153A that on the subsequent commencement certificate ‘Revised’ is mentioned, was already known to the Department before the Search action and hence, there is no question of treating any of the documents seized as an incriminating evidence. 1.9] In the course of hearing, the Ld. CIT(DR) referred to the layout plan and NA order in order to support his case that incriminating documents were found. However, he has also accepted that these documents were gathered in the post Search enquiries and none of the documents were seized at the time of the Search. Accordingly, the Assesssee submits that the layout plan and the NA order do not form part of the Bundle No. 1 which was seized at the time of the Search action and thus, no incriminating document was seized. It is also to be appreciated that the Ld AO in the assessment order has not referred to any incriminating document and therefore there is no question of making any addition for AY 2009-10 for which the original assessment was completed prior to the Search IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 9 action. The Assessee places reliance on the recent decision of the Hon’ble Supreme Court in the case of Pr. CIT vs Abhisar Buildwell P. Ltd. (Civil Appeal No. 6580 of 2021 and Others), please refer pages 255 to 313 of the Legal Compilation, in which the Hon’ble SC has said that in the case of non-abated assessments, no addition could be made in the absence of any incriminating evidence seized in the course of Search. Accordingly, the Assessee submits that in view of the principle laid down by the Hon'ble SC, the Ld CIT(A) has rightly deleted the disallowance made by the AO for AY 2009-10. 2.3] The relevant factual details of the two housing projects in respect of which deduction is claimed by the assessee u/s 80IB(10) are tabulated below: Details of Housing Project Date of first Building Plan Approval Date of Completion Time limit for completion u/s. 80-IB(10)(a) Phase I - ShivsaearCitv 06/07/2004 06/06/2007 - Part On or before • 17 residential buildings vide completion for 418 31/03/2009 (A-l to A-9, B-l to B-3, C- Commencement flats - Completion (within 4 years 1 & C-2, D-l to D-3) Certificate No. Certificate No. from the end of • 474 flats • Area sanctioned: 24,929.42 sq. mts. • Proportionate land area exceeds 1 acre • Shivsagar City (Phase I) Co- op. Housing Society Ltd., registered on 03.04.2008 CC/1269/04 BCo/14/2/152 16/07/2007 - Completion for 56 flats - Completion Certificate No. B Co/14/2/227 the year in which approval was granted) Please refer pages 67 to 90 of Paper Book - Vol. 1for the above documentary evidences Phase II - Shivsaear 26/03/2007 21/11/2011 for all On or before Residency vide 175 flats vide 31/03/2012 • 5 residential buildings Commencement Completion (within 5 years (E-l to E-5) Certificate No. Certificate No. from the year in • 175 flats • Area sanctioned: 12,114.06 sq. mts. • Proportionate land area exceeds 1 acre • Shivsagar Residency Co-op. Housing Society Ltd., registered on 24.01.2012 CC/4563/06 OCC/0903/11 which approval granted) Please refer pages 91 to 106 of Paper Book - Vol. Ifor the above documentary evidences IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 10 2.4] The assessee would also like to state that each of the two housing projects (Phase I and Phase II) have separate entry and exit points. These projects are fenced by separate compound walls, are separated by a 9 meter-wide road between them and do not have any common amenities. Further, these housing projects were developed at different points in time and were marketed as standalone independent projects. The above stated facts are also evidenced from the following: - Brochures published by the Assessee firm in respect of each of these projects (Please refer pages 71 to 89 and 94 to 105 of Paper Book - Vol. I) - Actual site photographs of these projects (Please refer pages 108 to 110 of Paper Book - Vol. I) - An online search for these projects on Google Maps (Please refer page 111 of Paper Book- Vol. I) - Agreement for sale executed with the flat buyers, wherein the name of the respective housing project is mentioned - Society registration certificates (Please refer pages 90 and 106 of Paper Book - Vol. I) 2.5] The Assessee submits that the disallowance made by the Ld. AO is not justified at all. Firstly, the Assessee will like to state that right from the beginning, it has claimed that it is constructing two different projects, namely Phase-I and Phase- II. The Assessee had claimed deduction u/s. 80IB(10) for Phase-I for the first time in AY 2008-09. The assessment was completed u/s. 143(3) and the claim made by the assessee was allowed. Now, the point to be appreciated is that the Search took place on 12/11/2014. The report of the Valuer is dated 24/02/2015. Accordingly, the point to be noted is that at the time of Search action as well as when the Valuer submitted his report, the time for reopening the case was available with the Department. However, the case for AY 2008-09 was not reopened and has attained finality. Now, once the claim of the assessee for AY 2008-09 has attained finality, it indicates that the Department has accepted that Phase-I and Phase- II constitute separate projects. Now, unless AY 2008-09 has been disturbed, the Ld AO does not get any jurisdiction to take a different stand in the subsequent years on the same issue. For this proposition, the Assessee places reliance on the decision of the Hon’ble Bombay High Court in the case of Western Outdoor Interactive (P.) Ltd. [2012] 25 taxmann.com 340 IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 11 (Bombay HC) (please refer pages 226-229 of the Legal Compilation) wherein the Honble Bombay High Court has held in the context of section 10A that if the deduction has been allowed in year 1 and the same has not been disturbed, the deduction could not be disallowed in the subsequent years. The relevant para from the above decision of the Honble Bombay High Court is as under: “6. We have considered the submissions. We find that the submissions made by Mr. Pardiwalla on the basis of the decision of this Court in the matter of Paul Brothers (supra) and Direct Information (P.) Ltd. (supra) merits acceptance. Therefore, in this case, it is not necessary for us to decide whether SEEPZ unit was set up/formed by splitting up of the first unit. In both the above decisions, this Court has held that where a benefit of deduction is available for a particular number of years on satisfaction of certain conditions under the provisions of the Income Tax Act, then unless relief granted for the first assessment year in which the claim was made and accepted is withdrawn or set aside, the Income Tax officer cannot withdraw the relief for subsequent years. More particularly so, when the revenue has not even suggested that there was any change in the facts warranting a different view for subsequent years. In this case for the assessment years 2000-01 and 2001-02 the relief granted under Section 10A of the Act to SEEPZ unit has not been withdrawn. There is no change in the facts which were in existence during the assessment year 2000-01 vis-a-vis the claim to exemption under section 10A of the Act. Therefore, it is not open to the department to deny the benefit of Section 10A for subsequent assessment years i.e. assessment years 2002-03 and 2003-04 and 2004- 05. Besides that, on consideration of the facts involved both the Commissioner of Income Tax (Appeals) and the Tribunal have recorded a finding of fact that the SEEPZ unit is not formed by splitting up of the first unit. ” 3.3] The assessee further places reliance on the decision in the case of Kewal Real Estate (P.) Ltd (ITA Nos. 2028 & 2218/PN/2012) (please refer pages 23 to 40 of the Legal Compilation). In that case, the assessee had undertaken construction of Phase-I and Phase-II. The commencement certificate for Phase-I was obtained on 02/02/2005 for 2 buildings. Subsequently, the assessee obtained revised commencement certificate in respect of Phase-II dated 08/09/2006 wherein there were certain changes even in respect of the buildings which were part of Phase-I. The Ld AO denied IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 12 the deduction to the assessee on the ground that Phase-I and Phase-II constituted one single project and since, Phase-II was not complete within the stipulated time period, the assessee was not entitled to claim deduction u/s 80IB(10). Hon’ble ITAT held that the contention of the AO is not correct. Simply because the subsequent approval by PMC was not a fresh approval but a revised approval did not mean that Phase-I and Phase-II constituted one single project. Hon’ble ITAT by placing reliance on the decision of the Hon’ble Bombay High Court in the case of Vandana Properties allowed the claim of the assessee. The Revenue challenged the said decision before the Hon’ble Bombay High Court and the order of Hon’ble ITAT has been approved by the Hon’ble Bombay High Court. It is also to be noted that Hon’ble Supreme Court has dismissed the SLP filed by the Department against the said High Court order (please refer pages 23-24 of the Legal Compilation). The assessee submits that even in the case of Kewal Real Estate (P.) Ltd the assessee had constructed Phase-I and Phase II and in the commencement certificate for Phase-II, it was mentioned as ‘revised’ and not ‘new’. However, it has been held that just because ‘revised’ is mentioned does not mean that the two projects constitute one single project. 3.4] Similarly, the assessee places reliance on the decision of Honble Bombay High Court in the case of Kores India Ltd [2020] 119 taxmann.com 281 {please refer pages 41-44 of the Legal Compilation) wherein initially the assessee had constructed 4 buildings and subsequently the assessee undertook development of Devpriya building. The deduction u/s 80IB(10) was denied on the ground that the construction of Devpriya building was an extension of existing 4 buildings. Hon’ble Bombay High Court has held that the building Devpriya was a separate project and simply because the local authority had imposed conditions in relation to building Devpriya as were originally imposed in case of earlier 4 residential buildings would not mean that the building Devpriya was an extension of the existing project. 3.5] The assessee further places reliance on the decision of the Hon’ble Bombay High Court in the case of Prathamesh Constructions [2021] 133 taxmann.com 74 {please refer pages 177-180 of the Legal Compilation). In that case, the assessee IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 13 had started housing project in 2001 comprising of buildings A to E, H and I and only the parking for building G was sanctioned. The assessee completed the construction of the said 7 buildings. Subsequently the plan was revised in 2011 and the assessee constructed building G. The Ld AO denied the claim on the ground that building G was part of the same project and since building G was not complete within the prescribed time limit. Hon’ble Bombay High Court has held that building G constituted a separate project for which building plan was approved subsequently. Even in that case, the subsequent plans were revision of the original plans. However, considering the principles laid down in the case of Vandana Properties, the deduction u/s 80IB(10) has been allowed by the Hon’ble Bombay High Court.” 5) Submission of ld.Departmental Representative(ld.DR) : The Ld.Commissioner of Income Tax (DR) filed written submission. The relevant part of it is reproduced as under : “As regards Completion Certificates are concerned, the appellant assessee was required to complete the entire projecton or before 31.03.2009. The entire project can be termed as completed only after all the requirements as mentioned in the Commencement Certificate is completed including peripheral wall / fencing, roads and other amenities etc. However, the fact is that the entire project was not completed within the time lines as no such Completion Certificate was issued by PMC to the appellant. Certain buildings were completed and accordingly, the completion of buildings A 1-9, B 1-3, C 1-2 & D 1-3 was issued in 06.06.2007 & 16.07.2007. However, the other buildings i.e. E, F, G & Commercial Building were not completed as detailed in the Table-2 above. The Commencement Certificates for the said buildings were issued vide Revised Commencement Certificates for construction in respect of the Revised Commencement Certificates for Development Plan issued vide letter dated 21.03.2007 and 16.04.2009 as mentioned in para 4.2 above. In view of above, the appellant's contention that the two CommencementCertificates dated 06.07.2004 and 26.03.2007 are for the two different projects and accordingly its claim that the project consisted of buildings El to E5 for which IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 14 Completion Certificate received on 21.11.2011 was also completed in the stipulated time prescribed in section 801 B( 10) is not correct. The fact is that the Completion Certificate for the entire project was never issued. This fact is further substantiated with the communication of the appellant assessee with PMC. The appellant has written a letter dated 04.11.2015 to PMC in reply to PMC's letter cum notice dated 17.10.2015. A copy of this letter dated 04.11.2015 is enclosed as Annexure-12 to the factual paper book. The following facts are revealed from this letter: (i) Total land being Part & Parcel of non-agricultural land admeasuring about 8 acres, 8 gunthas (17/1+2+3+5+6+7+8) from Sudhir Sable, Dilip Sable, Arun Sable and Sanjay Sable (the owner of the land) agreed to entrust the development of the said property in favour of the appellant (Sable Associates) by development agreement and Power of Attorney dated 12.04.2004 which was registered on 13.04.2004 at Serial No. 2135, 2137, 2142 and 2140, respectively. (ii) Thereafter, the said property came within limits of PMC. Therefore, the Layout Plan was submitted to PMC for development and construction of building of residential, commercial purpose. (iii) N.A. permission was also obtained under N.A. Order No. PRH/NA/SR/146/2004 and that the said layout has been sanctioned for various buildings which are to be developed or constructed in phase wise manner (para 2 of the letter). iv) The PMC has sanctioned layout of the building denoted in word 'H' in revised plan on 27.03.2007. v) That the scheme was launched for development of entire land which are amalgamated and common layout is sanctioned.” ...................... Brief synopsis on the arguments (based on written submission, factual paper book and legal compilation submitted on 23 Sep 2022) supporting the fact that the IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 15 project at S. No. 17. Hissa No. 1+2+3+5+6+7+8 at VadgaonBudruk, Pune was one project only for which First Commencement Certificate was issued on 06.07.2004 and the project was not completed within stipulated time. 1. The appellant launched the scheme for development of the entire land at survey No. 17/1+2+3+5+6+7+8, VadgaonBudruk, Pune and common layout was got sanctioned. The plot area was 68900.33 sq.m. The project was one and in each layout the project was mentioned as "Proposed building layout on S. No. 17, Hissa No.1+2+3+5+6+7+8 at VadgaonBudruk. Pune”. The commencement of construction was started vide Commencement Certificate (Construction Division), PMC dated 06.07.2004 with reference to Commencement Certificate (Layout Division), PMC dated 28.04.2004. The other Commencement Certificate issued subsequently were revised certificates. 1.1 For the project layout plans (including revised plans) were sanctioned on three occasions by development section of PMC as under: Sr. No. Date of commencement certificate (development plan) Departmental Paper Book page number for commencement certificate Departmental Paper Book page number for layout 1 28.04.2004 6 19 (reference) 2 21.03.2007 (revised-2) - 16 & 19 (reference) 3 16.04.2009 (revised-3) (Amalgamation + Proposed Building) 8, 10, 16 19 1.2 The commencement certificate issued by PMC (construction division) o- different occasions for the entire plot No. 17/1+2+3+5+6+7+8 on first occasion as new (i.e. VDB/0015/04 NEW) and further revised on different occasions as under: IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 16 Sr. No. Date of commencement certificate (construction) Departmental Paper Book page number for commencement certificate Departmental Paper Book page number for layout Reference of Layout i.e. Commencement Certificate (Development Plan) 1 06.07.2004 (new) 20 21 28.04.2004 2 16.12.2004 (Extension - Club House) 22 24 3 21.09.2005 (Revised) 25 4 26.03.2007 (revised-2) 27, 29, 30, 33 and 34 38 21.03.2007 5 30.03.2007 (revised-3) 39, 40, 44 45 21.03.2007 6 30.03.2007 (revised-4) 46, 48, 52 53 21.03.2007 7 05.05.2009 (revised-5) 54, 57, 61 67 1.3 Letter dated 04.11.2015 from the appellant M/s. Sable Associates to the Executive Engineer PMC, Pune [PBD (Departmental Paper Book) pages 68 to 73]: From this letter the following facts emerged: (i) That the scheme was launched for development of entire land which was amalgamated and common layout was sanctioned (PBD page 73). (ii) The plan was sanctioned under commencement certificate No. CC/1269/04 dated 06.07.2004 (PBD page 70). (iii) Revised layout was sanctioned in the year 2007 (PBD page 71). (iv) The PMC granted permission in revised plan vide CC0781/2009 dated 05.06.2009 (PBD page 71). 1.1 In view of above the AO was fully justified in holding that the project was a single project for the entire plot of land at S. IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 17 No. 17/1+2+3+5+6+7+8. The First Commencement Certificate was issued on 06.07.2004 and accordingly the project was not completed within stipulated time and accordingly the project was not eligible for deduction u/s 801 B(10). 1.2 The Ld. CIT(A) has discussed this issue in para 7.1 to 7.25 of his order. He has failed to appreciate the facts of the case and has held that project was not one and there were three projects taken up on the said plot of land and accordingly he has held that the two projects were eligible for deduction. He has relied on certain case laws which are on different fact. 6) Findings and Analysis : Ground Numbers 1-4of Revenue Revenue by Ground Numbers 1 to 4 has challenged allowability of the Assessee for deduction u/s 80IB(10) for the reason that the project was not completed before the statutory date . 6.1) In this case it is a fact that the Assessee had acquired development Rights for Land admeasuring approximately 69000 Sq. meters. The Assessee claimed that the Assessee has developed and constructed three different housing projects called as ‘ShivSagar City (phase I)’, ‘Shivsagar residency (phase II)’, ‘Shivsagar Platinum (phase III)’ on the said land admeasuring 69000 sq.m. The Ld.AR demonstrated that for each projects there are different ‘Building Plans Approval ’by Municipal Corporation. The Ld.AR submitted that the date for completion needs to be calculated from the date of the ‘Building Plan approval’. Ld.AR submitted that each project has received separate Completion certificate. There is separate compound wall for these projects.There are separate Housing Society for all these three projects. Therefore, the Ld.AR submitted that all these projects are independent housing project and hence eligible for deduction u/s.80IB(10) as each has received completion/ occupancy certificate within the statutory time limit. 6.2) On the other hand, Revenue has contended that all these three consist of one Housing Project as there is only one ‘Lay Out Plan’ sanction by the Pune Municipal Corporation. All the IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 18 building plans refer to the said Lay Out Plan. Therefore, date of completion should be calculated from the First Approvali.e. Commencement Certificate dated 06/07/2004 CC/1269/04 and accordingly, the project should have been completed before 31/03/2009.According to the revenue the entire project was not completed before the 31/03/2009, the assessee was not eligible for deduction u/s.80IB(10) of the Act. 6.3) The Income Tax Department had appointed Government Approved Valuer Mr.Nitin Lele. The Government Approved Valuer in his report dated 24/02/2015 has observed as under : 6.4) The Initial Lay Out Plan was as under : IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 19 Thus, the initial lay out plan shows only A1, A2, A3, A4, A5, A6, A7, A8, A9, B1, B2, B3, C1, C2, D1, D2 & D3. 6.5) The details of the Commencement Certificates issued by the Pune Municipal Corporation is discussed hereonwards. 6.5.1) CC/1269/04 dt.06/07/2004 as per the said Commencement certificate the Pune Municipal Corporation granted permission to start construction of Buildings A1,A2,A3,A4,A5,A6,A7,A8,A9,B1,B2,B3,C1,C2,D1,D2&D3 consisting of 474 residential units. These 17 buildings had received the “part Occupancy certificates” on following dates.  Vide Part Occupancy certificate No.BCO/14/2/152 dated 6/6/2007 , municipal corporation certified that Building No. A2,A3,A4,A5,A6,A7,A8,B1,B2,B3,C1,C2,D1,D2,D3 consisting of 418, residential premises, Parkings were completed.  Vide Part Occupancy Certificate No.BCO/14/2/227 dated 16/07/2007 Municipal Corporation certified that Buildings A1,A9, and its parking with 56 residential units were complete. Thus, as per the Pune Municipal Corporation’s Part Occupancy Certificates the 474 residential units and IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 20 parkings were duly completed on 06/05/2007 &16/07/2007. The assessee formed a co-operative society for these 17 Buildings which was called as “Shiv Sagar City Phase I” and it was duly registered with the Registrar of Co- operative Society on 03/04/2008.(PB page 90) 6.6) The assessee has claimed that the project ‘Shiv Sagar City Phase 1’ is an independent project consisting of 17 buildings. It is a fact that the said 17 buildings were duly completed on 06/05/2007 &16/07/2007 as discussed in earlier paragraph. These 17 Buildings had received Commencement Certificate on 06/07/2004. The assessee has submitted copy of the Brochure of the ‘Shiv Sagar City’ which was used for marketing by the assessee. The Lay Out Plan appearing in the said Brochure is as under: IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 21 Thus, in the said brochure, the assessee has only shown A1 to A9, B1 to B3, D1 to D3, C1,C2 under the head, ‘Shiv Sagar City’. 7) The assessee submitted a revised Lay Out Plan to the Pune Municipal Corporation which was approved by Pune Municipal Corporation videDPO10683/PLU-4/WK/19 dated 21/03/2007. Vide Revised Lay Out Plan, the assessee added Building E1 to E5. In the revised Lay Out Plan assessee has also shown space for Proposed buildings. 8) Then Pune Municipal Corporation as per revised Lay Out Plan, issued Commencement Certificate No.CC/4563/06 dated 26/03/2007 for Construction of E1,E2,E3,E4&E5. (paper book page 91,92).Page 91 of the paper book is the Drawing duly stamped by Corporation and page 92 is the Commencement Certificate. Both these documents have to be read together. There were 175 residential units. The Pune Municipal Corporations Letter IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 22 categorically mentions that ‘E’ was added and approved on 26/03/2007.(page 27-33 of Department paper Book) 9) Vide Part Occupancy Certificate Number OCC/0903/11 dated 21/11/2011 the Pune Municipal Corporation certified that E1,E2,E3,E4&E5 were complete and permitted to occupy. Thus, the E1,E2,E3,E4&E5 received commencement certificate for starting construction on 26/03/2007 and were complete on 21/11/2011. The assessee has given the name ‘Shiv Sagar Residency’ to these E1,E2,E3,E4&E5. The said ‘Shiv Sagar Residency’ was duly registered as Co-Operative Housing Society on 24/01/2012.(Certificate on page 106 of PB). The assessee has submitted copy of Brochure of the said ‘Shiv Sagar Residency’ which was used by the assessee for Marketing Purpose. In the said Brochure these E1,E2,E3,E4&E5 have been shown as under : IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 23 The Assessee has separately marketed these E1,E2,E3,E4&E5, which he called as ‘Shiv Sagar Residency’. The entire Brochure discuss only about E1,E2,E3,E4&E5. The Location Plan appearing in the said Brochure is as under : 10) Assessee filed another revised plan which was approved vide CC/4903/06 dated 30/03/2007 permitting the assessee to construct F1,F2,F3&F4. 11) The Assessee received Commencement Certificate Number CC/4901/06 dated 30/03/2007 for construction of ‘G’building. 12) We have elaborately narrated the factual position in the case of the Assessee in earlier paragraphs. In this factual background we have to decide now the eligibility of the assessee for deduction u/s.80IB(10) of the Act. IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 24 13) As per Section 80IB(10) explanation where the approval in respect of the housing project has been approved more than once such housing project shall be deemed to have been approved on the date on which building plan of such housing project is first approved by local authority. Thus, for the purpose of calculating date of limitation, the date of Building plan approval is most important. No where in the section 80IB(10), there is any reference to date of approval of Lay Out Plan. Therefore, the Ld.DR’s contention that the date of first Lay out Plan approval shall be considered is devoid of any merit. Housing project has not been defined in the Act but Hon’ble Bomby High Court has held in the case of Vandana Properties that “Therefore, the expression 'housing project' in Section 80IB (10) would have to be construed as commonly understood”. 14) The ITAT Pune Bench in the case of Rahul Construction Co.Vs. ITO [2012]21 taxmann.com 435(Pune) has held as under : Quote, “2. The relevant facts emerging from the orders of the authorities below are that the assessee firm engaged in the business of promoters and builders had claimed deduction u/s. 80IB(10) of Rs. 4,42,18,673/-. The same was denied by the A.O mainly on that basis that out 16 buildings in the project in which one single approval and sanction was taken, only 11 buildings were complete within the prescribed time limit upto 31st March 2008. The A.O. stated that the first lay out plan in respect of entire complex was sanctioned by Pune Municipal Corporation (PMC) vide order No. DPO/45/D/646 dated 3.4. 2003 and the building plan was sanctioned vide commencement certificate No. 4269 dated 29.4.2003. The entire project sanctioned by these orders comprised of A, B, C & D type of buildings were subjected to amendments later. Referring Explanation below Sec. IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 25 80IB(10)(a) of the I.T. Act, the A.O held that as per the Explanation (i) when the approval in respect of the housing project was obtained more than once, the very first approval was the date to be taken for the approval of the project for the purpose of Sec. 80IB(10)(a) of the Act. The A.O. stated that in this case, the date of approval of the project was 3.4.2003, therefore, Sec. 80 IB(10) (a) required that the project should have been completed on or before 31st March 2008, which was not fulfilled by the assessee in respect of the entire project comprising of A to D, type of buildings. 3. The contention of the assessee remained that the housing project consisted 16 buildings in a total area of 20 acres and 5 different lay out plans and accordingly different building plans were sanctioned from 3.4.2003 to 13.7.2003. Five buildings i.e. A1 to A 5 known as "Atul Nagar" were sanctioned as per amended lay out plans dated 27.6.2003, 3.10.2003 and 20th April 2004. Further, 6 buildings B1 to B 6 were constructed on the basis of lay out plans sanctioned on 15.9.2004 and 8.3.2006. It was stated that these 6 buildings known as "Rahul Nisarg Co-operative Housing Society Ltd." were separated by a wall from "Atul Nagar" and constituted a project by itself. It was submitted that different groups of building A & B should be treated different projects since these were constructed on plot of land which was more than 1 acre separately. The lay out plans were different for these 2 groups of buildings and these were completed well before 31 st March 2008. The A.O did not agree with these explanations of assessee. The Ld CIT(A) has also upheld the action of the A.O ............ 10. In view of above discussion, we come to the conclusion that for verification of eligibility of benefit claimed u/s. 80IB(10) of the Act by the assessee on buildings A1 to A5 in "Atul Nagar" and buildings B1 to B6 in "Rahul Nisarg Co-Operative Housing Society Ltd.", the assessing authority has to verify as to when the IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 26 building plans for these buildings were firstly approved by the local authority and taking the said date of approval a starting point, he has to verify as to whether these buildings were completed within the prescribed time limit i.e. 31 st March 2008 on the basis of the Completion Certificate in respect of such housing project issued by the PMC. When we examine the facts of the present case under the above background, we find that the authorities below have not disputed the fact furnished in this regard by the assessee that under the project "Atul Nagar" consisting of buildings A1 to A5, the first building plan for A type was approved by the PMC on 29.4.2003 vide Commencement Certificate No. 4269 (page No. 4 of the paper book). However, actual construction of A type building was executed as per the revised plan vide No. C.C. 4101/27/6/2003 (PAGE No. 5 of the paper book). The size of the plot on which the A type building i.e. A1 to A6 have been constructed is 1,39,466 sq.ft. The project A type building i.e. A1 to A5 consists of 360 residential units and the construction has been completed between 10.1.2005 to 31.8.2005 (page Nos. 6 to 9 of paper book). The authorities below have also not disputed this material fact that residential units has a maximum built up area of 1500 sq.ft. Likewise, these material facts that B Group buildings in "Rahul Nisarg Co-operative Housing Society Ltd.," have been constructed on land area of 138203 sq.ft., has not been denied by the authorities below. They have also not denied these material facts that the first building plan was sanctioned on 29.4.2003 vide Commencement Certificate No. 4269 issued by the PMC (Page No. 16 of the Paper Book). The other material facts like actual construction was executed as per the revised plan sanction on 20th March 2004 vide CC No. 2225 (page No. 17), the project consists of 396 flats and construction of these flats have been completed on 14.7.2006 as per the Completion Certificate issued by the PMC (Page Nos. 13 to 18 of paper book) are not in dispute. The authorities below have also not denied that built up area IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 27 of each of these flats does not exceed 1500 sq.ft. It is also not in dispute that both the projects are entirely a residential project and there is no commercial area therein. Under the above circumstances, we are of the view that the assessee is very much entitled to the claimed deduction u/s. 80 IB (10) of the Act on the buildings A1 to A5 in "Atul Nagar" and buildings B1 to B6 in "Rahul Nisarg Co-operative Housing Society Ltd." The issue is therefore decided in favour of the assessee. ” Unquote. 15) Similarly, ITAT Pune in the case of ACIT vs Kewal Real Estate Pvt Ltd ITA 2028 & 2218 /Pune /2012 vide order dated 21/09/2015 has held as under: Quote, “The undisputed facts as emerging from the records are, that the assessee had developed housing project “Kumar Primavera” on Plot No. 69, VadgaonSheir, Pune measuring 24902.715 sq. mtrs. The assessee had obtained commencement certificate on 02-02-2005 in respect of two buildings, initially named as A6 and A7, which were subsequently, renamed as A1 and A2. Thereafter, the assessee obtained commencement certificate in respect of buildings A3 to A8 on 08-09-2006. In all the assessee constructed 288 flats. In order to avail the benefit of deduction u/s. 80IB(10), the assessee was required to obtain completion certificate within 4 years from the end of financial year in which the housing project was approved by the local authority. Thus, in the present case, the last date for obtaining completion certificate was 31-03-2009. The assessee obtained completion certificate in respect of two buildings i.e. A1 and A2 on 05-09-2008. For the remaining six buildings i.e. A3 to A8 completion certificate was obtained on 31-03-2011. The assessee claimed deduction u/s. 80IB(10) in assessment years 2008-09 and 2009-10. During the assessment proceedings the Assessing Officer had deputed Registered Valuer to report about the status of project. The Registered Valuer vide his report dated 29-11-2010 inter alia observed that the completion certificate in respect of 80 flats is still pending. The Assessing Officer denied the benefit of deduction u/s. 80IB(10) on the ground that the assessee has not completed the project within the time frame as stipulated under the provisions of section 80IB(10) of the Act ............ 6. The contention of the assessee is that the buildings A1 and A2 are in Phase-I and buildings A3 to A8 are part of Phase-II of the project. The completion certificate in respect of Phase-I was obtained on 05-09-2008, well before last date on which the project should be completed i.e. 31-03-2009. As regards building A3 to A8 in Phase-II the completion certificate was obtained in March, 2011 and as per the provisions of Act, the last date for IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 28 obtaining completion certificate was 31-03-2012. The Revenue has strongly objected to the bifurcation of the project in Phase-I and Phase-II....... 11. The Mumbai Bench of the Tribunal in the case of MudhitMadanlal Gupta Vs. ACIT (supra) granted deduction u/s. 80IB(10) to the assessee, where the assessee had furnished completion certificate in respect of three wings of the project out of four. The Tribunal observed that the housing project does not necessarily have to be various group of buildings constructed on a particular land but it can also be a particular building or any building which is part of the large project....... 12. The Co-ordinate Bench of the Tribunal in the case of Rahul Construction Vs. ITO (supra) while dealing with a similar dispute has held as under:........... 13. Thus, from the facts of the case and the various decisions discussed above, we conclude that the assessee is eligible to claim deduction u/s. 80IB(10) on all the residential buildings comprising in Phase-I (A1 and A2) and Phase-II (A3 to A8). The date of completion of Phase-II shall be reckoned from the date of commencement certificate issued by PMC in respect of buildings A3 to A8. We do not find any infirmity in the order of Commissioner of Income Tax (Appeals), accordingly, the same is upheld and the appeals of the Department are dismissed.” Unquote. 15.1) The Income Tax department filed an Appeal against the said order of ITAT Pune in the case of Kewal Real Estate Pvt Ltd before the Hon’ble High Court. The Hon’ble High Court in [2020] 113 taxmann.com 623 upheld the order of the ITAT as under : “2. The issues pertain to the assessment year 2008-09. Respondent - assessee is a Private Limited Company and engaged in the business of real estate development. In relation to residential units constructed by the assessee, it had claimed deduction under Section 80IB(10) of the Income Tax Act, 1961 ("the Act" for short). Assessing Officer denied the benefit on the premise that the housing project was not completed within the time permitted. The CIT(A) allowed the assessee's appeal upon which the Revenue filed appeal before the Tribunal. The Tribunal, by the impugned judgment, dismissed the Revenue's appeal and confirmed the decision of the CIT(A). The Tribunal made the following observations:— 9. It is evident from documents that originally the assessee sought approval of buildings A6 and A7, subsequently renamed as A1 and A2 on 2.2.2005. It was after the time lag of 18 months that the approval of other six residential buildings was obtained by the assessee on 8.9.2006 from PMC, while seeking initial approval there was no mention of IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 29 other buildings. The observation of the Assessing Officer that the subsequent approval by PMC is not fresh approval but revised approval in our opinion does not carry weight. The building plan has been revised for buildings A1 and A2 only. As regards other buildings i.e A3 to A8 is concerned the building plan was approved for the first time. It is not disputed by the Revenue that buildings A1 and A2 in Phase-I were complete and occupation certificate was granted by the PMC in respect of said buildings on 5.9.2008. In so far as the buildings A3 to A8 in Phase-II are concerned, the completion certificate in respect of all the flats comprising in said buildings were granted by PMC up to March 2011, whereas, the last date for obtaining completion certificate was 31.03.2012. Thus, the assessee had obtained completion certificate well within the time frame mentioned in the provisions of Section 80IB(10) of the Act in respect of all the buildings in Phase-I and Phase- II." From the above portion of the judgment of the Tribunal, it can be seen that the assessee had established on record that the buildings referred to as Complex A1 and A2 were part of separate project for which a separate approval was granted by the Municipal Corporation. Likewise, with respect to buildings Complex A3 to A8, building permission was granted by the Municipal Corporation separately. It was, in this background, that the CIT(A) and the Tribunal accepted two different dates of completion taking into account the respective dates of approval of the housing project. The entire issue is one of the facts. No question of law arises. The Income Tax Appeal is dismissed. .” 16) The SLP filed by the department against the order of the Hon’ble High Court in the case of Kewal Real Estate P Ltd was dismissed by the Hon’ble Supreme Court vide order dated 02/08/2019 [2020]114 Taxmann.com576(SC). 17) The ITAT Pune in the case of DCIT Vs. Aditya Developers, ITA No.791/Pune/ 2008 has held as under : Quote, “7. There is no reason to dispute on facts in the present case that initially the proposed buildings ( except wings I, M, N, O, P and K in the present form) lay out plan was approved by the PMC on 25.5.1990 ( Page 94 of the paper book). The proposed building lay out plan was revised on 31.3.2001 (Page No. 5 of the paper book). The total area of land was 28905 sq. mtrs. The assessee had firstly completed development and construction of IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 30 buildings A,B, C,D,E,F,G,H & J in the area of 17,392 sq. mtrs of project KKN, leaving the land area of 8966 sq.mtrs vacant. In that vacant land, the assessee started the construction of buildings in wings K, M, N, I, O, P, K1 and K2 in the project “KKT”. In this project, 188 residential units were there each having built up area upto 1500 sq.ft. The building plans of the project “KKT” were approved on 9.3.2001 (wings K1 and K2) and 29.3.2001(wings I, M,N,O, P) which were completed on 10.10.2002 and 10.2.2003 respectively. Copy ofbuilding plan approved on 9.3.2001 has been made available at page No. 104 of the paper book, whereas the building plan approved on 29.3.2001 has been made available at page No. 103 of the paper book. There is no dispute on the dates of completion of the buildings in the housing project. The CBDT in its letter dated 4th May 2001 (page No. 110 of the paper book) has also made it clear that the definition of “housing project” is any project which has been approved by the local authority as a “housing project” should be considered adequate for purpose of Sec. 10(23 G) and 80 IB (10). We also find from the Explanation (i) to S. 801B(10) that the housing project and building plan of such housing project are two different concept. For a ready reference Explanation (i) to the Section is being reproduced hereunder : “Explanation- For the purposes of this clause, - (i) in a case where the approval in respect of the housing project is obtained more than once, such housing project shall be deemed to have been approved on the date on which the building plan of such housing project is first approved by the local authority;” From the very reading of the Explanation (i) makes it clear that the date on which building plan of such housing project is approved shall be deemed the date of approval of the housing project. We thus find that the assessee is very much eligible for the claimed deduction u/s. 80 IB (10) on the project ‘KKT’ in view of the above cited decisions including decision of Pune Bench of the Tribunal in the case of Nirmiti Construction Vs. DCIT (Supra), following which, in our view, the Ld CIT(A) has rightly allowed the claimed deduction. The same is upheld. The issue raised are thus decided in favour of the assessee. ” Unquote 18) ITAT Pune in the case of Parmar Properties Pvt Ltd vs DCIT ITA 234/Pune /2009 had laid down the proposition that the Lay Out Plan is separate and distinct from the Commencement Certificate, for the purpose of 80IB(10) the date of Commencement certificate is to be considered and not date of Lay Out Plan. 19) In the case under consideration also, the Assessee has received separate Commencement Certificates for Building A1 to A9, B1 to B3, D1 to D3, C1,C2 which assessee has described IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 31 as Shiv Sagar City Phase I and Shiv Sagar Residency consisting of building E1 to E5. The specific dates we have already mentioned in the earlier paragraphs. In these there are separate Society registrations. The Project Shiv Sagar City Phase I , Shiv Sagar Residency, were separately marketed by the assessee, both these projects had separate brochures as discussed in earlier paragraphs. Physically also they are separate as seen from the Lay out which is reproduced above. They are separated by road. Therefore, the proposition of law laid down by the decisions discussed above is that since housing project has not been defined in the Income tax Act section 80IB, it has to be understood in common parlance. The facts in the case of Kewal Real Estate Pvt Ltd (supra) , Rahul Construction Co (supra), Aditya Developers (supra), Parmar Properties Pvt Ltd (supra), are identical to the facts of the assessee under consideration. Therefore, respectfully following the Judicial Precedence, it is held that the , Shiv Sagar City Phase I, Shiv Sagar Residency, Shiv Sagar Platinum are different housing projects for the purpose of Section 80IB(10) of the Act. Accordingly, the date of limitation shall be calculated separately for each project as per the date of First Commencement certificate received by each project. There is no dispute on the fact that when the date of limitation is calculated separately for each project then the projects have been completed within the statutory time line. Hence, the Assessee is eligible for deduction u/s 80IB(10) for each project separately. Ld.DR has raised the issue that Occupancy certificate is not same as Completion certificate of the project as mentioned in the Act. However, as discussed by us in earlier paragraphs, each project is a separate project. Each Project has received Occupancy Certificate which mentions that the buildings have been completed as per the plan. Therefore, we do not find any merit in the argument of the Ld.DR. Ld.DR has relied on the recent ITAT Pune decision in the case of Amit Enterprises Housing Ltd ITA 602/PUN/2020 order dated 9/3/2023, Hemraj ShankarlalMundada ITA 1762/Pun/2018, P3 Properties ITA 41/PUN/2020. All these cases are factually distinguishable. IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 32 In the case of Hemraj ShankarlalMundada , it is an admitted position that Building B,C,D were not complete, also building A was not complete. In these facts the ITAT held that project was not complete. Therefore, this case is distinguishable on facts. In the case of P3Properties , the ITAT has given a factual finding that the Housing Plan was originally sanctioned on 1/7/2003, hence it was required to be completed on 31/03/2008. Thus, this case is distinguishable on facts. In the case of Amit Enterprises Housing Ltd, it was an admitted fact by the assessee that the 22 Bungalows were not complete which was part of this housing project. Therefore, the ITAT upheld the order of AO denying deduction u/s 80IB(10). Thus, even this case is distinguishable on facts. Thus none of the case relied by the Ld.DR have identical facts like the assessee under consideration. In non of these cases the assessee has brought to the notice of the ITAT the decision of Hon’ble Bombay High Court in the case of Kewal Real estate Pvt Ltd (supra), PCIT vs Kores India Ltd 119 taxmann.com281(Bom), hence the ITAT had no opportunity to analyze the facts on the touch stone of the law laid down by Hon’ble Jurisdictional High Court. Hence, none of the case laws relied by ld.DR are of any help to him. Ld.DR also relied on the decision of the Hon’ble Supreme Court in the case of Dilip Kumar &Co. We most humbly agree with the proposition of law laid down by the Hon’ble Supreme Court in the case of Dilip Kumar &Co that exemption provision shall be strictly interpreted. However, this case law is of no help to the Ld.DR as the present case under consideration is about appreciation of facts and not about interpretation. Therefore, for all the reasons discussed in earlier paragraphs, we are of the considered opinion that on the facts and circumstances of the case, the three projects are separate housing projects for the purpose of deduction u/s 80IB(10) of the Act. For each project date of commencement shall be the date of First Commencement certificate issued by PMC for that particular project. It is observed that Shiv Sagar City Phase I was received Commencement certificate on 06/07/2004 and it received the Occupancy Certificate on 06/06/2007, 16/7/2007, Shiv Sagar Residency received Commencement Certificate on 26/03/2007 and it received occupancy certificate on 21/11/2011, which were completed within the statutory time limit mentioned in the IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 33 section 80IB(10) of the Act. Hence, the Project Shiv Sagar City Phase I, Shiv Sagar Residency are eligible for deduction u/s.80IB(10) of the Act. Accordingly, Revenue’s Ground No.1 to4 are dismissed. Ground No.6 &7 : This is about proportionate deduction allowed by Ld.CIT(A). For AY 2013-14, we have already held that the assessee is eligible for deduction u/s.80IB(10) of the Act. hence, this ground becomes academic in nature Be it as it may be, this issue has already been decided by the Hon’ble jurisdictional High Court in the case of Model Construction Pvt Ltd vs DCIT 429 ITR 605(BOM)(26-11-2020) in favour of Assessee. Hon’ble Bombay High Court had upheld the order of CIT(A) granting prorate deduction. Therefore, respectfully following Hon’ble Bombay High Court, the Ground Numbers4, 6 and 7of the Revenue are dismissed. In the result, Ground No 6 and 7 of the Revenue are dismissed. Ground No.5 : Ground No.5 is related to violation of Sub-clause(f) of section 80IB(10) of the Act. In the assessment order, the Assessing Officer(AO) has vaguely mentioned that there is violation of Sub-clause(f). The AO has vaguely mentioned that there are 31 instances of violation of Sub-clause(f). However, in the assessment order for A.Y. 2013-14, the AO has not mentioned the specific flat numbers and names of the purchasers and how they are related to each other. In the absence of basic IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 34 facts, AO’s allegation has got no legs to stand. We have already mentioned that the municipal corporation has nowhere mentioned any violation of approved plans. As per approved plans, all the flats are less than 1500 sq.ft. The Department appointed valuer has also certified that all the flats are less than 1500 sq.ft. The sub-clause(f) of section 80IB(10) was introduced w.e.f. A.Y. 2010-11. However, the project Shivsagar City Phase-1 was completed on 16.07.2007. The project Shivsagar Residency was started on 26.03.2007 and completed on 21.11.2011. As we have already mentioned that AO has not specifically stated the Flat Numbers, the name of the project and names of the owners for alleged violation of Sub-clause(f) of section 80IB(10), therefore, we do not find any merit in the allegation of the AO. Accordingly, Ground No.5 of the Revenue is dismissed. In the result, Ground No.5 of the Revenue is dismissed. Ground No.8 : The Ground No.8 is regarding undisclosed cash expenses of Rs.35,14,000/- allowed by the ld.CIT(A) against the undisclosed cash receipts of Rs.1,25,36,000/-. During the search, a diary belonging to Sanjay Sabale was seized. Statement of IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 35 Mr.SanjaySabale was recorded during the search. Based on the seized document, the AO made addition of Rs.1,25,36,000/- as undisclosed income. The assessee claimed expenses of Rs.54,34,100/- as expenditure in connection with the unaccounted receipt of Rs.1,25,36,000/-. The assessee claimed that in the same diary, these expenditures of Rs.54,34,100/- are appearing. The ld.CIT(A) after analyzing the various entries in the diary, allowed undisclosed expenditure of Rs.35,14,000/- against the undisclosed receipt of Rs.1,25,36,000/-. We have gone through the copies of the relevant pages of the diary filed by Revenue in the paper book. We have also studied orders of the Lower Authorities. The assessee has not disputed receipt of Rs.1,25,36,000/-. There is no dispute that there are certain entries appearing in the impugned diary which reads as “expenses in connection with facilitation work- Bawdhancompound date 26.07.2012. i. 23.04.2012-Kadam Nagarani Rs.26,600/-. ii. 22.08.2012-Bhagwath ParipawtanBawdhan Rs.2,00,000/- IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 36 iii. 07.05.2012-Bawdhan Commission -Bande Rs.1,20,000/- These are the some of the entries which were appearing in the impugned diary. Similarly, there are other entries. Careful observation of these entries reveals that these are some expenditures. We agree with the assessee’s submission that once Department has accepted entries in the diary related to receipts to be true, then Department also has to accept entries in the same diary related to expenditure to be true. Also, Ld.CIT(A) has carefully analyzed each entry and then allowed expenditure onlyof Rs.35,14,000/- which were directly in connections with the income earned. Therefore, in these facts and circumstances of the case we agree with the Ld.CIT(A)’s analysis. Hence Ground number 8 of the revenue is dismissed. Ground No.9 is general in nature, does not need any adjudication, hence, the Ground No.9 is dismissed. In the result, appeal of the Revenue is Dismissed. IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 37 Cross Objection No.36/PUN/2022 (Assessee) : Ground No.1 : The Government Approved Valuer appointed by the Department has already certified in point number 4.2 that “Area of no flat is more than 1500 sq.ft.”. It has been alleged that Flat No.C2/503 and C2/504 were combined and combined area is more than 1500 sq.ft.However, the Government approved valuer had visited the project and then given the report which states that area of no flat is more than 1500 sq.ft. On perusal of the building plan, it is observed that the Flat No.C2/503 & C2/504 are independent units having area less than 1500 sq.ft. The Municipal Corporation in the occupancy certificate has not mentioned any deviation. It means that the Flat No.C2/503 & C2/504 were constructed with area less than 1500 sq.ft. There are two independent agreements. Therefore, there is no document on record to state that Flat No.C2/503 & C2/504 have been combined and its combined area is more than 1500 sq.ft. It is also observed that Flat No.C2/503 & C2/504 were sold in F.Y.2007-08 and the possessions were handed over on 06.06.2007. The entire revenue from sale of Flat No.C2/503 & C2/504 was recognized in A.Y. 2008-09. The Department in the assessment order for A.Y.2008-09 passed under section 143(3) has allowed assessee’s claim for deduction under section 80IB(10) of the Act. In these facts and circumstances of the case, the assessee’s Cross Objection Appeal is Allowed. IT(SS)A No.09/PUN/2021 & C.O.No.36/PUN/2022 M/s. Sable Associates 38 Ground No.2 : Vide Ground No.2, the assessee has raised the issue of expenditure claimed against unaccounted cash receipts of Rs.1,25,36,000/-. We have already discussed this in Ground No.8 of the main appeal i.e. IT(SS)A No.09/PUN/2021 of the assessee above. Accordingly, our findings will apply mutatis- mutandis to this Cross Objection’s Ground No.2. Therefore, Ground No.2 raised by the assessee is dismissed. In the result, Cross Objection appeal of the assessee is partly Allowed. Order pronounced in the open Court on 28 th August, 2023. Sd/- Sd/- (PARTHA SARATHI CHAUDHURY) (DR. DIPAK P. RIPOTE) JUDICIAL MEMBER ACCOUNTANT MEMBER पुणे / Pune; ᳰदनांक / Dated : 28 th August, 2023/ SGR* आदेशकᳱᮧितिलिपअᮕेिषत / Copy of the Order forwarded to : 1. अपीलाथᱮ / The Appellant. 2. ᮧ᭜यथᱮ / The Respondent. 3. The CIT(A), concerned. 4. The Pr. CIT, concerned. 5. िवभागीयᮧितिनिध, आयकरअपीलीयअिधकरण, “बी” बᱶच, पुणे / DR, ITAT, “B” Bench, Pune. 6. गाडᭅफ़ाइल / Guard File. आदेशानुसार / BY ORDER, // TRUE COPY // Senior Private Secretary आयकरअपीलीयअिधकरण, पुणे/ITAT, Pune.