9911796707
TMI Blog2015 (9) TMI 549X X X X Extracts X X X X X X X X Extracts X X X X ..... or an amount of Rs. 38,74,435 in respect of its housing project named Vertex Sadguru Krupa situated at Survey Nos. Part 76/B and 77/B, Hydernagar Village, Nizampet Road, Hyderabad. During the assessment proceeding, AO while examining assessee's claim of deduction u/s 80IB(10), found from the information available on record that though assessee claimed to have acquired land in Survey No. Part 76/B and 77/B, Hydernagar Village, Nizampet Road, Hyderabad, from some persons, but, lands were never acquired by assessee company, but, they were taken for execution of works contract on lease basis through an agreement of sale-cum-GPA only. Thus, it was inferred by AO that as per the amended provisions of section 80IB(10), deduction cannot be allowed wherein assessee executes housing project as a works contract awarded by any person including the state or central govt. He also noted that though assessee had also executed some other housing projects, but, except housing project named Vertex Sadugur Krupa, assessee has not claimed 80IB(10) deduction in respect of other housing projects. He observed that assessee has shown relatively high profit percentage of 8.81 in respect of Sadguru Krupa com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the completion certificate is only for three blocks, assessee is not eligible for deduction u/s 80IB(10)/ She observed that even partial completion certificates was issued on 30/12/2011 whereas as per the provisions of section 80IB(10), the project should have been completed by 31/03/2011. Thus, on the aforesaid consideration, she disallowed assessee's claim of deduction u/s 80IB(10). 6. Ld. AR submitted before us, none of the reasons on which AO disallowed assessee's claim of deduction u/s 80IB(10) were found to be valid by ld. CIT(A). However, ld. CIT(A) found out a new reason in disallowing assessee's claim of deduction u/s 80IB(10) by holding that as assessee has failed to furnish completion certificate for the entire project and only submitted a partial completion certificate it is not eligible for deduction u/s 80IB(10). Ld. AR submitted, approval granted by competent authority is for residential apartments and not any particular project. Ld. AR submitted, assessee has obtained permission to build six different blocks and the claim of deduction u/s 80IB(10) is restricted to three blocks which were fully complete and assessee has also submitted completion certificate from t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at within the stipulated period of five years, assessee has completed only three blocks i.e. Block A, B & F whereas the other three blocks C, D & E have not been completed. Assessee also admits this factual position. It is also a fact on record that in respect of block A, B & F, assessee has submitted a completion certificate from the municipal authorities certifying that these three blocks are complete in all respects with all amenities. In view of the aforesaid factual position, the issue which arises for consideration is whether assessee can claim deduction u/s 80IB(10) in respect of three blocks, which are fully complete. As could be seen, ld. CIT(A) has disallowed assessee's claim of deduction solely on the basis that entire housing project has not been completed within the stipulated period. On a reference to provision as contained u/s 80IB(10), it is evident that assessee shall be eligible for 100% deduction of the profits derived in respect of a housing project subject to fulfillment of the conditions mentioned therein. In the present case, there is no dispute that block A, B & F comprises of area of more than 1 acre. There is also no dispute to the fact that none of the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of large project. It has been further held that whatever portion of the housing project is otherwise found to be eligible has to be considered as a housing project for the purpose of deduction u/s, 80 IB (10) of the Act. Similar view has been expressed by Mumbai Bench of the Tribunal in the case of Vandana Properties(supra)." 8.1 Thus, the principle which emerges from the aforesaid judicial precedents is, even a single building consisting of a number of residential units can be considered to be a housing project by itself, hence, will be eligible for deduction u/s 80IB(10), if it otherwise fulfills the conditions of section 80IB(10). Applying the aforesaid principles to the facts of the present case, it is very much evident that blocks A, B & F in respect of which assessee has claimed deduction u/s 80IB(10) are fulfilling all the conditions of the said provision. It is also a fact that municipal authorities have also issued completion certificate certifying that the buildings are complete in all respects. In the aforesaid view of the matter, assessee, since has fulfilled all conditions of section 80IB(10) in respect of blocks A, B & F, it is eligible for deduction u/s 80IB(10). ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
