Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (12) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (12) TMI 929 - AT - Income TaxDeduction u/s 80IB deleted Held that - as per sub-section 10 of section 80IB of the Act, the housing projects which were approved before 31st day of March, 2008, the benefit will be hundred per cent subject to fulfilment of certain conditions - this condition was substituted by Finance (No.2) Act of 2009 with effect from 1.4.2009 which has been further explained by sub-clause (ii) to Explanation regarding completion certificate - since the approval was granted to the assessee on 1.4.2005, therefore, the assessee is not expected to fulfill the conditions which were not on the statute when such approval was granted to the assessee - the law existing at the particular point of time will be applicable unless and until it is specifically made retrospective by the legislature - The substitution so made, is therefore, applicable prospectively and not retrospectively - approval was granted to the assessee on 16-3-2005, consequently the assessee was expected to complete the project on or before 31-3-2009. The assessee is expected to complete the project as per the approved plan at a particular point of time and the assessee is not expected to do or to fulfill the conditions which are not in existence at the relevant point of time or made compulsory after making some amendment in the Act from the future date - since the assessee was to complete the project on or before 31- 3-2009 and request was duly made with the Competent Authority on 5-11-2008 mentioning that the project has been completed and completion certificate may be issued and if the same is not issued by the Competent Authority the assessee should not be penalized for the same unless and until some contrary facts are brought on record evidencing that the assessee contravened the conditions contained in the approval granted by such Competent Authority - as per sub-section (10) of Sec. 80-IB, the housing project which were approved before 31st day of March, 2008, the benefit will be hundred per cent subject to fulfillment of certain conditions. However, this condition was substituted by the Finance (No.2) Act of 2009 with effect from 1-4-2009, which has been further explained by sub-clause (ii) to the Explanation regarding completion certificate. However, since the approval was granted to the assessee on 1-4-2005, therefore, the assessee is not expected to fulfill the conditions which were not on the statute when such approval was granted to the assessee Decided against revenue. Claim of depreciation on computer peripherals @ 60% - Held that - Following the decision in COMMISSIONER OF INCOME TAX Versus BSES YAMUNA POWERS LLD. / BSES RAJDHANI POWERS LTD. 2010 (8) TMI 58 - DELHI HIGH COURT - computer accessories and peripherals such as, printers, scanners and server etc. form an integral part of the computer system - the computer accessories and peripherals cannot be used without the computer - as they are the part of the computer system, they are entitled to depreciation at the higher rate of 60% - CIT(A) was justified in deleting the additions Decided against revenue.
Issues Involved:
1. Deletion of addition made by AO on account of deduction under Section 80IB. 2. Deletion of addition made on account of wrong claim of depreciation on computer accessories and peripherals. Issue-wise Detailed Analysis: 1. Deletion of Addition Made by AO on Account of Deduction Under Section 80IB: The primary issue revolves around whether the CIT(A) erred in deleting the addition made by the AO concerning the deduction under Section 80IB. The AO disallowed the deduction claimed by the assessee on the grounds that the project violated the area restriction of 1500 sq. ft. per residential unit, the assessee did not furnish the audit report under Section 10CCB, and the assessee failed to provide a completion certificate from the competent authority. The CIT(A) allowed the appeal of the assessee, following the precedent set by the ITAT Delhi 'B' Bench for AY 2006-07 and 2007-08, which was upheld by the Hon'ble High Court of Delhi. The High Court observed that stringent conditions imposed by amendments should not apply retrospectively, causing undue hardship. The Tribunal and CIT(A) found that the project approval dated before the amendment in 2005 did not require a completion certificate, and the built-up area, excluding common areas like staircases, was within the prescribed limit. The CIT(A) also noted that the AO's approach was hyper-technical and did not consider the practical aspects of compliance with conditions that were not in force at the time of project approval. The Tribunal upheld this view, emphasizing the principle of consistency and the applicability of law as it stood at the time of project approval. 2. Deletion of Addition Made on Account of Wrong Claim of Depreciation on Computer Accessories and Peripherals: The second issue concerns the deletion of the addition made by the AO regarding the wrong claim of depreciation on computer accessories and peripherals. The AO contended that only computers and computer software are eligible for 60% depreciation, not the accessories and peripherals. The CIT(A) granted relief to the assessee by relying on the decision of the Hon'ble Delhi High Court in the case of CIT vs. BSES Rajdhani Power Ltd., which held that computer accessories and peripherals form an integral part of the computer system and are entitled to depreciation at the higher rate of 60%. The Tribunal upheld this view, finding no ambiguity or perversity in the CIT(A)'s order. Cross Objections by the Assessee: The assessee filed cross objections to support the CIT(A)'s order and to allege the assessment order. However, since the Tribunal dismissed the revenue's appeals, the cross objections were deemed infructuous and dismissed accordingly. Conclusion: The Tribunal dismissed both the appeals of the revenue and the cross objections of the assessee, upholding the CIT(A)'s order on both issues. The Tribunal emphasized the importance of consistency in applying the law and the necessity of considering the practical implications of compliance with statutory conditions. The decision reinforced that amendments to the law should not be applied retrospectively to the detriment of taxpayers who acted in accordance with the law as it stood at the time of their actions.
|