2014 (12) TMI 1320 - HC - Income Tax

Deduction u/s 80IB - Date of commencement of project u/s 80IB - earlier commencement certificate cancelled - Held that - Earlier commencement certificates could not be held to be valid after one year from the date of issuance - thereafter, there was a commencement certificate issued on 2nd March, 2001 - if the earlier certificate was lapsed or were treated as cancelled, then, the Tribunal was right in its conclusion that benefit of section 80IB (10) can be derived or taken by the assessee thus all the three conditions for availing of the deduction or benefit are, thus, complied with - hence the appeal does not raise any substantial question of law and it is, accordingly, dismissed

Summary

Issues:
Challenge to the order passed by the Income Tax Appellate Tribunal by the Revenue regarding the Assessee's Appeal.

Analysis:
The Appeal was filed by the Revenue challenging the order passed by the Income Tax Appellate Tribunal in the Assessee's Appeal. The Assessee had filed an Appeal in the Tribunal against the order of the Commissioner of Income Tax (Appeals). The Revenue contended that two questions of law raised by them were substantial. The first question was argued to be covered by a Division Bench judgment, while the second question was not covered. The main issue revolved around the commencement of a construction project by the Assessee under section 80IB(10) of the Income Tax Act. The Revenue argued that the Assessee had received a commencement certificate, allowing them to start the project, while the Assessee's counsel argued that the certificate had lapsed or was invalidated by the time the construction started. The Tribunal considered the facts and found in favor of the Assessee.

The Senior Counsel for the Assessee argued that the commencement certificate issued earlier was not valid by the time construction began, as it had expired or been canceled. He also pointed out the requirement for clearance under the Urban Land (Ceiling and Regulation) Act, 1976, for which an exemption was needed. The Tribunal took into account the facts presented by the Assessee and concluded that the earlier commencement certificates were no longer valid by the time construction commenced. Therefore, the Assessee was eligible for the benefit under section 80IB(10) of the Act. The Tribunal's decision was based on factual findings and admitted material, which were not considered erroneous by the High Court. The Court agreed with the Tribunal's conclusion and dismissed the Appeal, stating that no substantial question of law was raised.