2018 (12) TMI 1719 - HC - Income Tax

Deduction u/s 80IB(10) - assessee has not completed the project due to failure attributable to assessee itself within stipulated time prescribed u/S. 80IB(10) - AO denied the benefit on the premise that the housing project was not completed within the time permitted - HELD THAT - 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.

Summary

Issues involved:
Challenge to the judgment of the Income Tax Appellate Tribunal regarding eligibility for deduction under Section 80IB(10) of the Income Tax Act, 1961 based on completion of a housing project within the stipulated time frame.

Analysis:
The issues in this case revolve around the eligibility of the assessee, a Private Limited Company engaged in real estate development, to claim deduction under Section 80IB(10) of the Income Tax Act, 1961 for the assessment year 2008-09. The Assessing Officer initially denied the benefit, contending that the housing project was not completed within the permitted time frame. However, the CIT(A) allowed the assessee's appeal, leading to the Revenue filing an appeal before the Tribunal. The Tribunal upheld the decision of the CIT(A) by dismissing the Revenue's appeal. It was observed that the completion certificates for buildings A1 and A2 in Phase-I were granted within the stipulated time frame, while the completion certificates for buildings A3 to A8 in Phase-II were obtained by the assessee before the deadline. The Tribunal noted that the approval process for the buildings was sequential and separate, leading to the acceptance of different completion dates for the two complexes. The Tribunal emphasized that the issue primarily pertained to facts, and no legal question arose. Consequently, the Income Tax Appeal was dismissed.

In conclusion, the judgment highlights the significance of meeting the conditions stipulated in Section 80IB(10) of the Income Tax Act, 1961 for claiming deductions related to real estate development projects. The case underscores the importance of timely completion of housing projects and obtaining necessary approvals within the specified time frame to qualify for the tax benefits provided under the Act. The decision emphasizes the factual nature of the dispute and the Tribunal's role in assessing compliance with statutory requirements for availing tax deductions. Ultimately, the judgment reaffirms the principle that the eligibility for tax benefits is contingent upon fulfilling the statutory conditions, including timely completion of projects as prescribed by law.