9911796707
TMI Blog2016 (2) TMI 566X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax (Appeals)-I, Pune for the respective assessment years. All the impugned orders are dated 17-02-2011. Since, the issues involved in all the appeals are identical, these appeals are taken up together for adjudication. 2. In the grounds of appeal, the assessee has raised various grounds. The ld. AR of the assessee has filed applications to withdraw ground Nos. 1 to 4 and 12 in ITA No. 857/PN/2012 for the assessment year 2003-04, ground Nos. 1 to 4, 12, 13 and 14 in ITA No. 858/PN/2012 for the assessment year 2004-05 and ground Nos. 1 to 4, 11, 12 13 in ITA Nos. 859 860/PN/2012 for the assessment years 2005-06 2006-07, respectively. The applications of the assessee are accepted, the above mentioned grounds raised in the respective assessment years are dismissed as withdrawn. As far as other grounds raised in the appeals, they all relate to single issue i.e. disallowance of deduction claimed u/s. 80IB(10) of the Income Tax Act, 1961 (hereinafter referred to as the Act ). 3. The facts of the case as emanating from the record are: The assessee is a partnership firm engaged in the business as promoter and developer of real estate. The assessee developed housing project ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that even otherwise the project was completed on 16-05-2005. There was delay in completion of only 6 flats which were subsequently completed well before the due date. The assessee had applied for completion certificate to the PMC on 16-05-2005. A copy of the application is placed on record at page 7 of the paper book. The completion certificate in respect of 6 flats was issued by the PMC on 09-10-2009. A copy of certificate is placed at page 39 of the paper book. A perusal of the final completion certificate would show that the same was issued in response to the application dated 16-05-2005 made by the assessee. The ld. AR further referred to the information sought under the Right to Information Act, wherein it has been mentioned that the application for occupation certificate was made on 16-05-2005 and no objection was found in the said matter. The ld. AR contended that in the first instance the assessee was not required to obtain completion certificate from the PMC to claim deduction u/s. 80IB(10) and secondly, the assessee had completed the project well before 31-03-2008. Therefore, the assessee was eligible to claim deduction u/s. 80IB(10) of the Act. The ld. AR in order to sup ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner of Income Tax Vs. Global Reality (supra). Therefore, the decision rendered in the said case is not applicable in the facts and circumstances of the case in hand. The ld. AR further submitted that the Hon'ble Delhi High Court and the Hon'ble Madras High Court has given decision on this issue in favour of the assessee. It is a well settled law that where two views are possible, the view in favour of the assessee has to be followed. To support his submissions, the ld. AR placed reliance on the decision of Hon'ble Supreme Court of India in the case of Commissioner of Income Tax Vs. Vegetable Products Limited reported as 88 ITR 192 (SC). 7. We have heard the submissions made by the representatives of rival sides and have perused the orders of the authorities below. We have also considered the decisions on which both the sides have placed reliance. In the present set of appeals the only issue raised by the assessee is denial of deduction u/s. 80IB(10) for non-completion of project before the due date. Undisputedly, the commencement certificate was issued to the assessee in respect of project Laxmi Vihar on 01-02-2002. As per the contention of the assessee th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... RATION The assessee has also placed on record copy of possession receipts and the monthly electricity consumption bills issued by Maharashtra State Electricity Distribution Company Ltd. to show that the six flats in respect of which completion certificate was issued by PMC on 09-10-2009 where complete, the allottees had taken possession and were occupied by the families prior to 31-03-2008. Nothing has been brought on record by the Department to show that there was any deficiency or objection pointed out by the PMC for not granting the completion certificate. Thus, the delay in issuance of completion certificate by the PMC cannot be attributed to the assessee in the facts and circumstances of the present case. 9. Apart from merits of the case on facts, we further observe that the assessee had commenced the project prior to 01-04-2004. The provisions of section 80IB(10) have been amended w.e.f. 01-04-2005 by the Finance Act (No. 2) of 2004, whereby the condition for obtaining completion certificate was inserted. The Hon'ble Supreme Court of India in the case of Commissioner of Income Tax Vs. Sarkar Builders (supra) has held that the Department cannot deny the benefit o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (i) of clause (a) to section 80-IB(10) of the Act prescribes that where a housing project is approved on or before 01.04.2004 then the development and construction of such housing project shall be completed on or before 31.03.2008. Explanation (ii) below clause (a) of section 80- IB(10) of the Act provides that the date of completion of construction of the housing project shall be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority. 8. In the present case, it is an admitted position that the housing project of the assessee known as Runwal Daffodils commenced with effect from 12.12.2003 and therefore construction of such a housing project was required to be completed on or before 31.03.2008 as stipulated in sub-clause (i) of clause (a) to section 80-IB(10) of the Act. It is also not denied by the assessee that the relevant completion certificate has not been issued by the local authority i.e. PMC on or before 31.03.2008. However, the case setup by the assessee is that the project of the assessee was approved and it commenced on 12.12.2003, which pertains to a period prior to 01.04.2005 i.e. the date on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roved by the local authority on or after the 1st day of April, 2005, within five years from the end of the financial year in which the housing project is approved by the local authority. Explanation- For the purposes of this clause,- (i) in a case where the approval in respect of the housing project is obtained more than once, such housing project shall be deemed to have been approved on the date on which the building plan of such housing project is first approved by the local authority; (ii) the date of completion of construction of the housing project shall be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority; (b) the project is on the size of a plot of land which has a minimum area of one acre: Provided that nothing contained in clause (a) or clause (b) shall apply to a housing project carried out in accordance with a scheme framed by the Central Government or a State Government for reconstruction or redevelopment of existing buildings in areas declared to be slum areas under any law for the time being in force and such scheme is notified by the Board in this behalf; (c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rejected for assessment year 2004-05 on the ground that the assessee had not furnished the completion certificate. 8. xxxxxxxxxx 9. xxxxxxxxxx 10. In view of the facts of the case and the decisions discussed above we hold that non obtaining of completion certificate in respect of project approved prior to 01-04-2005 will not render the assessee ineligible for claiming deduction u/s. 80IB(10) in the impugned assessment years. In appeals for assessment years 2005-06 to 2007-08, the Revenue has raised ground with regard to commercial units in the project. Since, the same has not been pressed by the ld. DR. The same are dismissed as not pressed. Thus, in the facts of the case and the well settled law discussed above, we are of the considered opinion that the assessee is eligible to claim deduction u/s. 80IB(10) in respect of its project, Laxmi Vihar at Hadapsar, Pune. 11. The ld. DR has placed reliance on the decision rendered by the Hon'ble Madhya Pradesh High Court in the case of Commissioner of Income Tax Vs. Global Reality (supra). We find that the facts of the present case are at variance with the facts in the case of Income Tax Vs. Global Reality ..... X X X X Extracts X X X X X X X X Extracts X X X X
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