2014 (8) TMI 154 - AT - Income Tax

Claim of deduction u/s 80IB(10) Two combined units sold to one purchaser Area exceeds 1000 sq.ft. Held that - Following the decision in assessee s own case for the in M/s. Om Trinetri Builders & Contractors Versus The ITO, Ward 20(2) (3), Mumbai 2014 (8) TMI 152 - ITAT MUMBAI - CBDT has issued a notification dated 3/8/10, whereby it is now notified that any scheme approved under Regulation 33(10) of DCR for Greater Mumbai 1991, and by the SRE for Slum Rehabilitation would be valid for the purpose of Clause- a and b of section 80 IB (10) of the Act - the amended provisions of law will not apply and so long as per the plans approved by the concerned authorities, the built up area of each flat is less than 1000 sq.ft. the deduction u/s 80IB(10) of the Act cannot be denied to the Assessee on the ground that two flats as per approved plan lying adjacent to each other have been combined into one flat and owned by one owner or jointly with some of the members of his family - the rejection of the claim of the assessee for deduction u/s 80 IB(10) on this account cannot be sustained Decided against Revenue.

Summary

Issues:
- Appeal against CIT(A) order for assessment year 2008-09 regarding deduction u/s. 80IB(10)
- Dispute over exceeding built-up area of units sold
- Consideration of survey u/s. 133A results
- Request to set aside CIT(A) order and restore AO's order

Analysis:
1. The main issue in this case is the revenue's appeal against the CIT(A) order for the assessment year 2008-09 regarding the deduction under section 80IB(10). The revenue contested the allowance of the deduction despite the assessee selling two combined units to one purchaser, exceeding the specified area of 1000 sq.ft.

2. The Tribunal considered the arguments presented by both sides and examined the material on record. The assessee referred to a previous Tribunal order related to the approval of the Slum Rehabilitation Authority and the built-up area of individual flats exceeding 1000 sq.ft.

3. The Tribunal noted that the CBDT notification validated schemes approved under relevant regulations for the purpose of section 80IB(10). Additionally, the Tribunal cited a case precedent where the approval of building plans with individual flats less than 1000 sq.ft. each allowed merging of two flats into one unit without affecting the eligibility for deduction under section 80IB(10).

4. The Tribunal emphasized that the legislative amendment restricting the sale of residential units to family members was prospective from 1-4-2010 and did not apply to the case under consideration. As long as each flat's built-up area was less than 1000 sq.ft. as per approved plans, the deduction under section 80IB(10) could not be denied, even if two adjacent flats were combined into one unit.

5. Given the consistency of facts with previous assessment years and the CIT(A) decision in line with the Tribunal's earlier ruling, the Tribunal decided in favor of the assessee and dismissed the revenue's appeal, upholding the deduction under section 80IB(10) for the assessment year 2008-09.

6. The Tribunal's decision was based on the interpretation of the law, precedents, and the specific circumstances of the case, ensuring that the deduction under section 80IB(10) was allowed as per the approved plans and legal provisions applicable during the relevant assessment year.

This detailed analysis highlights the key arguments, legal interpretations, and precedents considered by the Tribunal in reaching its decision on the issues raised in the appeal.