2013 (3) TMI 669 - AT - Income Tax

Summary

Issues Involved:
1. Eligibility for deduction u/s 80IB(10) based on plot size.
2. Completion of the project within the prescribed time limit.
3. Misconceived grounds related to a different project.

Summary:

Issue 1: Eligibility for Deduction u/s 80IB(10) Based on Plot Size

The primary issue in all appeals relates to the assessee's claim for deduction u/s 80IB(10) of the Income Tax Act. The Revenue contended that the plot size did not meet the minimum requirement of 1 acre as per clause (b) of section 80IB(10). The Assessing Officer (AO) argued that the plot was divided into four parts, none of which individually exceeded 1 acre. However, the CIT(A) found that the entire plot of 7265.63 sq.mtrs was acquired as a single plot and not divided. The CIT(A) relied on the 7/12 extract and the development agreement, which described the plot as a single portion. The Tribunal upheld the CIT(A)'s findings, noting that the AO's assertions lacked supporting material and that the road within the plot was an internal road, not owned by the Municipal Corporation.

Issue 2: Completion of the Project Within the Prescribed Time Limit

The Revenue argued that the project was not completed within the stipulated time, as the completion certificate was obtained on 06-06-2008, beyond the deadline of 31-03-2008. However, the CIT(A) clarified that the completion certificate dated 06-06-2008 pertained to a different project named "Vrundavan," not "Shreerang Vihar." The Tribunal found that the "Shreerang Vihar" project was completed within the required timeframe, supported by occupancy certificates issued by the local authority. Consequently, the Tribunal dismissed the Revenue's appeal on this ground.

Issue 3: Misconceived Grounds Related to a Different Project

The Revenue's third ground of appeal was related to the "Vrundavan" project, which was not relevant for the assessment years 2002-03 to 2005-06, as no deduction u/s 80IB(10) was claimed for this project during these years. The Tribunal dismissed this ground as misconceived.

Conclusion:

For the assessment years 2002-03, 2003-04, and 2005-06, the Tribunal applied the same reasoning as in the case of A.Y. 2004-05 and dismissed the Revenue's appeals. For A.Y. 2006-07 and 2007-08, the Tribunal found no error in the CIT(A)'s decision that the "Vrundavan" project met the plot size requirement of 1 acre. Consequently, all appeals filed by the Revenue were dismissed.

Pronounced in the Open court on this, the 20th day of March 2013.