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2023 (8) TMI 71 - AT - Income TaxDeduction u/s. 80IB(10) on proportionate basis - AO noted that the partial completion certificate makes it clear the 22 bungalows part of Bloomfield project have not been completed before 30-01-2012 as mandated by section 80IB(10) - HELD THAT - When, there is no satisfaction with regard to fulfillment of conditions as required u/s. 80IB(10) assessee is not entitled to claim deduction even on proportionate basis as held in the case of Vijay Tukaram Raundal 2022 (9) TMI 80 - ITAT PUNE by following the decision of M/s. Dilip Kumar and Company others 2018 (7) TMI 1826 - SUPREME COURT . CIT(A) granted pro-rata deduction on eligible units even when the entire project have not been completed. Further, there is a clear recording of finding by the CIT(A) about 22 bungalows forming part of Bloomfield project which is a subject matter of this appeal were not completed by the stipulated date. Thus, the CIT(A) committed error in granting proportionate deduction even though the project has not been completed within stipulated time. Thus, the order of CIT(A) is not justified and it is set aside. Grounds raised by the Revenue are allowed.
Issues Involved:
The judgment involves appeals by the Revenue against separate orders passed by the Commissioner of Income Tax (Appeals) for assessment years 2012-13, 2013-14, and 2014-15. The main issue is whether the deduction under section 80IB(10) of the Income Tax Act was rightly allowed on a proportionate basis despite non-compliance with the conditions stipulated under the Act. Issue 1: Appeal in ITA No. 602/PUN/2020 for A.Y. 2012-13 The appellant-revenue raised eight grounds of appeal, focusing on the deduction u/s. 80IB(10) of the Act. The contention was whether the CIT(A) was justified in allowing the deduction on a proportionate basis despite non-compliance with the conditions stipulated under the Act. The argument presented was that the completion of the project did not meet the requirements within the stipulated time frame as mandated by section 80IB(10) of the Act. The appellant emphasized that without a completion certificate for the entire project, the assessee was not entitled to claim a proportionate deduction under the Act. Issue 2: Appeals in ITA No. 603/PUN/2020 and IT(SS)A No. 135/PUN/2019 The issues raised in these appeals were found to be identical to the ones in ITA No. 602/PUN/2020, with the only variance being in the amount. The findings given in the appeal of Revenue in ITA No. 602/PUN/2020 were deemed applicable to ITA No. 603/PUN/2020 and IT(SS)A No. 135/PUN/2019. Consequently, both appeals of Revenue were allowed based on the same reasoning and conclusions as in the first appeal. In the detailed analysis of the case, it was observed that the assessee failed to complete the entire project within the stipulated time frame as required by section 80IB(10) of the Act. The partial completion certificate provided by the assessee indicated that only a fraction of the total buildings were completed within the specified period. The completion certificate for the entire project was lacking, leading to the conclusion that the conditions for claiming the deduction were not met. The Tribunal referred to previous decisions and the provisions of the Act to support the denial of a proportionate deduction in such circumstances. The CIT(A) was found to have erred in granting the deduction despite the incomplete project, and the order was set aside in favor of the Revenue. The judgment, delivered by the Appellate Tribunal ITAT Pune, highlights the importance of fulfilling statutory conditions for claiming deductions under the Income Tax Act. The decision emphasizes the strict adherence to legal requirements, especially regarding project completion timelines, to ascertain the eligibility for tax benefits.
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