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TMI Blog2016 (6) TMI 122X X X X Extracts X X X X X X X X Extracts X X X X ..... )(c) would not be applicable to projects commenced prior to 01.04.2005. 4. The learned Commissioner of Income- tax(Appeals) erred in coming to the above conclusion on the incorrect premise that estoppel can be invoked against the Government in exercise of its legislative powers. 5. The learned Com missioner of Income-tax(Appeals) erred in holding that though the am ended provision of section 80IB (10)(d) and 80IB (14)(a) cam e into operation w.e.f. 01.04.2005, those were not applicable in the case of assessee relating to A .Y.2005 -06 without appreciating and applying the principle laid down by Hon'ble Supreme Court in the case of CIT Vs. Isthmian S team ship Line, 20 ITR 52 and Karim tharuvi Tea Estate Ltd., 60 ITR 262. 6. The learned Com missioner of Income-tax(Appeals) erred in not appreciating that even if the am ended law w as prospective, the limitation of restrictions u/s.80IB(1)(d) and 80IB (14)(a) are still applicable to A .Y.2005 -06 relying upon Reliance Jute Industries V s. CIT reported in 120 ITR 921(SC ). 7. The appellant craves leave to add, alter or am end any or all the grounds of appeal. 3. The learned Authorized Representative for the assessee at th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med deduction under section 80IB(10) of the Act at Rs. 4,83,83,848/- in respect of the project namely "Treasure Park" and sum of Rs. 34,35,747/- in respect of other project namely "Ved Vihar". The claim of deduction for project "Ved Vihar" was allowed by the Assessing Officer. However, in respect of project "Treasure Park", the Assessing Officer noted that it was situated at Survey No.61 and consisted of 352 residential units, 23 shops and 3 showrooms. There were 10 buildings i.e. A to H and J & K, which had total built up area of 4,47,620 sq.ft. The buildings A to H were residential and buildings J & K were commercial buildings / shops. The Assessing Officer also noted that in buildings A to H, part of building D and entire building F had non-80IB(10) residential units with built up area of each unit to be more than 1500 sq.ft. The total residential built up area was 4,35,295/-, out of which the total built up area in respect of building F and part of building D, which had flats exceeding 1500 sq.ft., was 51,302 sq.ft. The rest of area where built up area of each flat was less than 1500 was 3,33,993 sq.ft. Further, the buildings J & K named as Sant Nagar shops were exclusively com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng project in the first place and further since the conditions laid down in the said section were not satisfied, the deduction claimed under section 80IB(10) of the Act was held to be not available for the project. The claim of assessee for proportionate deduction in respect of eligible units was also denied by the Assessing Officer on the ground that the said deduction was admissible to the housing project as a whole and not for portion thereof. The Assessing Officer in this regard, placed reliance on various decisions of Tribunal and denied the deduction claimed under section 80IB(10) of the Act. 6. Before the CIT(A), the assessee explained that certain areas of project were not considered by it as part of eligible housing project for the purpose of computation of deduction under section 80IB(10) of the Act. It was further contended that where the other buildings in the project were satisfying the conditions laid down in section 80IB(10) of the Act, the Assessing Officer was not justified in disallowing the claim made by the assessee. It was claimed by the assessee that the buildings F, J, K and 4 flats of building D were not part of eligible housing projects and even if they we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2008-09 shall hold good for the assessment year under consideration and the project "Treasure Park" was held to be eligible for deduction under section 80IB(10) of the Act also. The alternate plea of the assessee on without prejudice basis that proportionate deduction in respect of units which satisfied the requirements of section 80IB(10) of the Act may be allowed, was held to be not survive, in view of the assessee succeeding on the main aspects of the issue. 7. The Revenue is in appeal against the order of CIT(A) in this regard and has raised objections that where the project was approved as a residential and commercial project and not as housing project, the assessee was not entitled to the claim of deduction under section 80IB(10) of the Act. Further, grounds of appeal have been raised against non-fulfillment of amended provisions of section 80IB(10)(c) of the Act and 80IB(10)(d) of the Act. 8. We find that identical issue of claim of deduction under section 80IB(10) of the Act in respect of project named "Treasure Park" arose before the Tribunal in ITA No.2210/PN/2013 , relating to assessment year 2008-09 and vide order dated 23.09.2015, the Tribunal considered the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Ld.CIT(A) allowed the claim of deduction u/s.80IB(10) in respect of the entire housing project. While doing so, he held that since the project has been approved on 17-12-2004 which is prior to 01-04-2005 , therefore, the areas covered by terraces and balconies are to be excluded from the built up area and therefore the units of building F, whe re none of the units exceed 1500 sq.ft. after reducing the terraces and balconies and therefore the assessee is entitled to deduction u/s.80IB(10). So far as buildings J and K are concerned he held that since the project is approved prior to 01-04-2005, therefore, the limit of 5% or 2000 sq.ft. whichever is less is not applicable to the project of the assessee. For the above proposition he relied on the decision of the Hon'ble Bombay High Court in the case of Brahma Associates reported in 333 ITR 289 where it has been held that prior to the amendment there was no restriction in the area of commercial buildings and the said restriction is not applicable to the earlier years. Even though the assessment year involved in 2008-09 still the limit is not applicable because the project was sanctioned prior to the said amendment. 26. As regards ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case of Sarkar Builders (Supra) has held that where housing projects were sanctioned before the amendment but have been completed after 01-04-2005 when the amended provisions came into operation the assessee would be entitled to the deduction u/s.80IB(10)and the conditions mentioned in clause (d) would not apply. Thus, the benefit restricted to cases where the area utilized for shops and commercial establishments does not exceed 5% of aggregate built up area of housing project or 2000 sq.ft which was less does not to apply to projects where approval of local authority was granted prior to 01-04-2005 even if project is completed thereafter. 30. Since in the instant case admittedly, the project has been sanctioned prior to 01-04-2005 and the project has been completed after 01-04-2005, therefore, the restriction on the area of commercial building is not applicable to the facts of the present case. Therefore, this objection of the Revenue being devoid of merit is dismissed. 31. So far as the objection of the AO that the built up area of all the flats in building F exceeded 1500 sq.ft., we find the Ld.CIT(A) has given a categorical finding that after exclusion of the balconies an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Revenue." 32. Since in the instant case the built up area of all the units of building F are less than 1500 sq.ft. after excluding the balconies and terraces, therefore, the CIT(A) was fully justified in allowing the claim of deduction u/s.80IB(10) in respect of building F. 33. So far as denial of deduction u/s.80IB(10) in respect of the 2 units of building D are concerned, we find the assessee has not claimed deduction in respect of the above 2 units in the return of income on the ground that the combined area of the adjoining flats exceed 1500 sq.ft. However, before CIT(A) the assessee took an additional ground and claimed the deduction in respect of the above 2 units on the ground that assessee has sold independent units to the respective customers which were less than 1500 sq.ft. It is the customers who have combined the flats and therefore the assessee is entitled to deduction u/s.80IB(10). We find the Ld.CIT(A) admitted the additional evidence and on the basis of the declaration of the customers held that it is the customers who have combined the units and the assessee has sold separate units to the customers where the built up area of each unit is less than 1500 sq.ft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... establishments in buildings J & K. The assessee initially had not claimed the deduction under section 80IB(10) of the Act in respect of above said flats and commercial shops. However, additional grounds of appeal were raised before the CIT(A) in assessment year 2008-09 that it was entitled to the claim of deduction under section 80IB(10) of the Act. The said additional plea raised by the assessee was considered at length and after considering the additional evidence filed by the assessee and admitting the same under Rule 46A of the Rules, the CIT(A) held the assessee to be eligible to claim the deduction under section 80IB(10) of the Act. Similar claim has been made by the assessee in the instant assessment year relating to assessment year 2009-10 and where the factual aspects and issue raised are identical to the issue in assessment year 2008-09, following the same parity of reasoning and also because of reason that the CIT(A) in allowing the claim of deduction, had in turn relied on the order of CIT(A) relating to assessment year 2008-09, which has been upheld by the Tribunal in assessment year 2008-09, we allow the claim of assessee. Upholding the order of CIT(A) in this regard ..... X X X X Extracts X X X X X X X X Extracts X X X X
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