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TMI Blog2012 (8) TMI 1077X X X X Extracts X X X X X X X X Extracts X X X X ..... Residency - Phase-I' and the profits earned from such project were claimed as exempt in terms of section 80IB(10) of the Act. The assessments in question, relating to A.Ys. 2003-04 and 2004-05, have been passed u/s.143(3) r.w.s. 263 of the Act dated 30.12.2009 as a consequence of an order passed by the Commissioner of Income-tax-III, Pune, u/s.263 of the Act. In so far as the A.Y. 2007-08 is concerned, the assessment has been framed u/s.143(3) of the Act dated 29.12.2009. However, the reasons prevailing with the Assessing Officer to deny the claim of deduction u/s. 80IB(10) stand on an identical footing in all the three years. 4. In brief, the dispute is with regard to the condition prescribed in clause (c) of section 80IB(10) of the Act, which, as per the Assessing Officer, has not been complied with by the assessee. Clause (c) to section 80IB(10) of the Act prescribes that the 'built-up' area of the residential units in the approved project should not exceed 1500 sq. ft. in the cities other than Delhi and Mumbai. As per the Assessing Officer, in the present case such a condition has not been fulfilled in as much as in case of four residential units in the project ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly; (v) that the individual flats have different electricity connection with separate electricity meter as evidenced by the separate electricity bills placed on record; and (vi) that each flat owner was a separate share holder/member in the Society created. 6. On the basis of the aforesaid, the CIT(A) held that the merger of flats occurred in the hands of the flat purchasers after the sale of flats by the assessee, and therefore, it could not be said that the project of the assessee violated the condition prescribed in clause (c) of section 80IB(10) of the Act. In coming to such conclusion, the CIT(A) relied upon the decision of the Mumbai Bench of Tribunal in the case of G.V. Corporation reported in 133 TTJ 178 (Mum). The claim of deduction u/s.80IB(10) was thus allowed for the three captioned assessment years. 7. Against the aforesaid, the Revenue is in appeal before us. Before us, the Ld. Departmental Representative appearing for the Revenue has reiterated the objection raised by the Assessing Officer which is to the effect that after considering the built up area of the flats combined, the same exceeded the limit prescribed u/s. 80IB(10) of the Act, and therefore, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see has 83 different flats out of which it was noticed that Flat Nos.602, 702 in B-Wing and Flat Nos.202, 203 in C-Wing, were combined into two bigger units and in this manner the 'built-up' area of the bigger units exceeded 1500 sq.ft. The assertions of the assessee were to the effect that the merger of these units took place after the sale and handing over of possession of the flats to the buyers by the assessee. The CIT(A) has accepted the plea of the assessee for the reasons we have noted earlier in this order. 10. Factually speaking, it is emerging from the orders of the authorities below that the four flats are separate units in the building sanctioned plans as approved by the local authorities. Further, it is also noticeable from para 5.2 of the order of the CIT(A) that they have been booked by the customers and sold individually under separate agreements. Further, the flats have different entrances, kitchens, lobbies etc. The flats have been issued completion certificates by the municipal authorities individually showing their separate character. Each flat has a electricity meter/connection as noted by the CIT(A) in para 5.4 of the impugned order. In fact the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was not also the case of the Commissioner that each flat in the housing projects undertaken by the assessee could not have been used as an independent or self- contained residential unit not exceeding 1,000 square feet of built-up area and that there would be a complete, habitable residential unit only if two or more flats were jointed with each other, which would ultimately exceed 1,000 square feet of built-up area. In such a situation, merely because 9 out of 140 purchases desired to join the flats purchased by them into one single unit, which exceeded 1,000 square feet of built-up area, could not disentitle the assessee to the deduction. If each residential unit did not exceed the built-up area of 1,000 square feet, the fact that they were joined together by the purchasers for better living or for more space or for any other reason did not disentitle the assessee to the claim for deduction under section 80-IB. 11. Ostensibly the conclusion reached by the CIT(A) is based on factual material and there is no material brought on record before us which would enable us to interfere with the order of the CIT(A). Having regard to the aforesaid discussion in the order of the CIT ..... X X X X Extracts X X X X X X X X Extracts X X X X
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