2019 (6) TMI 1051 - AT - Income Tax

Deduction u/s 80IB(10) - built up area of a flat in the housing project should not exceed 1500 sq.ft. - CIT(A) granted proportionate deduction to the units/flats which were having area less than 1500 sq. ft. - HELD THAT - As decided in assessee's own case the findings namely that the projections are external projections, it is for the purpose of aesthetic beauty of the building, are not habitable and not utilizable from inside and all allowed by the Corporation and not considered by them for the purpose of calculating the area of the flat, has not been controverted by the Revenue. In such a situation, we are of the view that the deduction u/s 80IB(10) cannot be denied to the assessee. We therefore direct the AO to allow the deduction on the entire project. Thus the grounds of the assessee are allowed. Revenue has not pointed out any distinguishing feature in the facts of the present case and to that of assessee s own case in A.Y. 2010-11 nor has placed any material on record to demonstrate that the decision of Pune Tribunal in assessee s own case in A.Y. 2010-11 2017 (11) TMI 116 - ITAT PUNE which has been relied upon by Ld.CIT(A) has been set aside / overturned or stayed by Higher Judicial Forum. In view of the aforesaid facts, we find no reason to interfere with the order of Ld.CIT(A) and thus the grounds of Revenue are dismissed.

Summary

Issues involved:
- Claim of deduction u/s 80IB(10) for A.Y. 2011-12 and 2012-13
- Proportionate deduction based on flat area exceeding 1500 sq. ft.
- Consistency in decisions between A.Y. 2010-11 and the current appeals

Analysis:

Issue 1: Claim of deduction u/s 80IB(10) for A.Y. 2011-12 and 2012-13:
- The appeals by the Revenue were based on separate orders of the Commissioner of Income Tax (Appeals) for the assessment years 2011-12 and 2012-13. The facts and issues in both appeals were deemed identical, leading to a consolidated hearing for convenience. The primary contention revolved around the denial of deduction u/s 80IB(10) of the Act by the Assessing Officer, which was subsequently allowed by the Ld.CIT(A) for the assessee.

Issue 2: Proportionate deduction based on flat area exceeding 1500 sq. ft.:
- In the case of the project "Sun Orbit," the Assessing Officer disallowed the deduction as certain flats exceeded 1500 sq. ft., contravening the provisions of Sec.80IB(10) of the Act. However, the Ld.CIT(A) granted proportionate deduction based on compliance with other conditions stipulated under the section. The Revenue challenged this decision, arguing for the denial of deduction for units with areas exceeding the specified limits.

Issue 3: Consistency in decisions between A.Y. 2010-11 and the current appeals:
- The Tribunal referred to a previous case for A.Y. 2010-11 where the deduction was allowed for units meeting the specified area criteria, despite discrepancies in area calculations by different valuers. The Tribunal upheld the Ld.CIT(A)'s decision, emphasizing that certain architectural projections should not be counted in built-up area calculations. The Revenue failed to demonstrate any distinguishing features or legal precedents to overturn the Ld.CIT(A)'s order, resulting in the dismissal of the Revenue's appeals for both A.Y. 2011-12 and 2012-13.

In conclusion, the Tribunal dismissed the appeals by the Revenue for both assessment years, affirming the decisions of the Ld.CIT(A) regarding the claim of deduction u/s 80IB(10) and the granting of proportionate deduction based on flat area criteria. The Tribunal highlighted the importance of consistency in decisions and upheld the principle that certain architectural projections should not be included in built-up area calculations for determining eligibility for deductions under the Act.