9911796707
TMI Blog2016 (5) TMI 1485X X X X Extracts X X X X X X X X Extracts X X X X ..... completed. No infirmity in the order of the CIT(A) granting pro-rata deduction to the assessee in respect of Buildings B and C which were completed. We find the Pune Bench of the Tribunal in the case of M/s. Kumar Company [2016 (2) TMI 231 - ITAT PUNE] while deciding identical issue had allowed the claim of pro-rata deduction wherein held AO cannot reject the claim of deduction u/s.80IB(10) of the entire project for non-completion of the few buildings. We therefore set aside the order of Ld.CIT(A) and direct the AO to allow pro-rata deduction claimed u/s.80IB(10) - Decided in favour of assessee. - ITA No.2004/PN/2014 Assessment Year : 2010-11 - - - Dated:- 27-5-2016 - Shri R.K. Panda And Shri Vikas Awasthy, JJ. Assessee by: Shri Kishor Phadke Department by: Shri S.K. Jadhav ORDER R.K. PANDA, AM : This appeal filed by the Revenue is directed against the order dated 28-07-2014 of the CIT(A)-II, Pune relating to Assessment Year 2010-11. 2. Facts of the case, in brief, are that the assessee is an individual and engaged in the business of Promoters and Builders in the name and style of Harshad Constructions . He filed his return of income for the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... buildings which satisfy the conditions of section 80IB(10). The project was the one which was sanctioned by the Municipal Authority which included Building A. Rejecting the various explanations given by the assessee the AO disallowed the claim of deduction of ₹ 3,05,70,196/- u/s.80IB(10) of the I.T. Act. 4. Before CIT(A) it was submitted that the AO rejected the claim of deduction u/s.80IB(10) on account of Non-Construction and Noncompletion of Building A. The assessee furnished an event chart of the various dates on which the agreement with Mrs. Najmunissa Kazi, the landlord, was entered into for the purchase of 232.29 sq.mtrs of land. It was submitted that the landlord, i.e. the Sayyed family had undertaken the responsibility of extending possession of Building A land. However, Mrs. Kazi who was the occupant of the land, did not vacate the said area till 2012 for which the assessee could not start construction of Building A on the said land. The assessee had a genuine difficulty in constructing Building A. Because of various problems attached with the land on which the Building A was to be constructed it was submitted that it was not practically possible for the assesse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that was to be constructed by the appellant. The appellant started the construction of the project on the plan that the entire land is to be available for the for the project, however, Mrs. Kazi sold the land to the appellant in the year 2010 and the possession extended in 2012. The very fact that Mrs. Kazi paid the municipal taxes of the property on the land owned and occupied by her has been paid till 2012 and the old construction on the said land existing till 2012. The commencement certificate issued by the PMC stipulated and, restricted the appellant as per condition 11 that an old existing construction on the land shall, be demolished before commencing the work. Thus' the appellant who had already undertaken the project and started its construction was prohibi.ted to carry out construction of building 'A' as the part of land area of 232 sq. mtrs. owned by Mrs, Kazi was sold only on 01.11.2010 and possession handed over at a much later date in 2012. Moreover, the appellant would have required a fresh, commencement certificate to start construction of building 'A', as the time of one year had already lapsed before the date of original sanction given in Feb ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9; units means that deduction should be computed unit-wise. Therefore, if a particular unit satisfies the conditions of sec.80IB, the assessee is entitled for deduction. Therefore, the Tribunal upheld the order of Ld. CIT(A) in allowing deduction u/s.80IB(10) In respect of two blocks as claimed by the assessee. 4.4.1 In ITO Vs AIR Developers (supra) The tribunal held that Assessing Officer is directed to determine the built up area of the residential units by applying the development control Regulation, 2000 and to allow proportionate deduction u/s.80IB(10) if he finds that the built up area of some of the residential units exceed 1500 sq.ft. 4.4.2 In Sheth Developers (supra) the Mumbai ITAT held as regards the A project assessee is eligible for relied on pro-rata basis in respect of the flats which did not have a built up area exceeding 1000 sq.ft. quantum of deduction in respect of the flats which have built up area less than 1000 sq.ft., has to be worked out on pro-rata basis AO accordingly directed to verify the claim of the assessee and allow the deduction on pro-rata basis in respect of flats in A project. 4.4.3 In the case of G.V. Corporation Vs. ITO (supra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... plan are two different concepts. Thus, the part of the project comprising of buildings B C is a separate project and which satisfied all the conditions stipulated u/s.80IB(10) and hence the appellant is very much entitled to claim the deduction u/s.80IB(10) of the Act, on buildings B and C in view of the above set of reasoning by the Tribunal. 4.4.5 In the case of M/s. Runwal Multihousing Pvt. Ltd. Vs. ACIT (Supra) after considering various judicial precedents of different High courts and Coordinate benches, the Pune Tribunal held that 21.3 In view of the above decisions, we are of the considered opinion that whatever portion completed by the assessee which satisfies the conditions prescribed u/s. 80IB(10) is eligible for deduction. The various decisions relied on by the revenue are distinguishable and not applicable to the facts of the present case. We accordingly hold that the assessee is eligible for deduction u/s. 80IB(10) in respect of building No. A,C,D, E and the 17 row houses. The grounds raised by the assessee on this issue are accordingly allowed. 4.4.6 In the case of Bengal Ambuja Housing Development Ltd. (Supra), the facts were that the housing proj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uilt up area crossing the limit as specified in clause (a) of Sec.80IB(10) of the Act. In such event on a reading of the provision, it is held that the assessee would not be entitled to have the benefit of 100% absolute deduction u/s.80IB(10) of the Act in respect of the entire project, but would be entitled to pro rata deduction on the units satisfying the conditions . . . . . . . . . . 4.4.8 In DCIT Vs. Ekta housing (P) Ltd. (2011) 44 (II) ITCL 404 (mum) it was held that in cases certain residential house has built up area in excess of 1500 sq.ft, the assessee could not lose the total exemption u/s.80IB(10) in its entirety but will lose the proportionate exemption u/s.80IB(10). Deduction u/s.80IB(10) on pro rata basis was therefore allowable. 4.4.9 Thus in view of the above facts, the ratio of the judicial decisions and the appellant having satisfied the other condition as stipulated u/s. 80IB(10) such as regarding the area of the plot having no commercial area the appellant gets entitled to the deduction u/s.80IB(10) on pro rata basis with respect to the blocks and units satisfying the conditions u/s.80IB(10) of the Act. 6. Aggrieved with such order of the CIT(A) the Rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 149 (Madras High Court) 4. ACIT Vs. Subhash F. Bafna vide ITA Nos. 316 to 319 and batch of connected appeals and batch of other appeals order dated 26-06-2014 (Pune B Bench) 5. M/s Kumar Company Vs. Addl.CIT vide ITA No.1652/PN/2012 order dated 06-01-2016 (ITAT Pune) 6. CIT Vs. Elegant Estates vide Tax Appeal No.1172/2015 (Madras High Court) 9. We have considered the rival arguments made by both the sides, perused the orders of the AO and CIT(A) and the paper book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the assessee in the instant case is an individual and engaged in the activity of Promoters and Builders in the name and fashion of Harshad Constructions . During the impugned assessment year the assessee has constructed a housing project at Ashok Nagar, Handewadi Road, Hadapsar, Pune. The commencement certificate for this project was received by the assessee on 14-02-2007 which was subsequently revised on various dates. As per the original plan passed by the Municipal authorities, there are three buildings, viz., A, B and C. The assessee has submitted the completion certificate only for Buildings B and C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ft., the entire claim of the assessee in respect of these two projects would stand rejected under Section 80IB(10) of the Income Tax Act. Thus, going by the definition of housing project under Explanation to Section 80HHBA of the Act as referred to above as the construction of any building and the wordings in Section 80IB(10) of the Act, the question of rejection in entirety of the project on account of any one of the blocks not complying with the conditions, does not arise. Even in the case of each one of the blocks, wherever there are flats which satisfied the conditions particularly of the nature stated under Section 80IB(10)(c) of the Act, we have already upheld the case of the assessee in T.C.Nos.1348 and 1349 of 2007 dated 10.10.2012 for grant of relief under Section 80IB(10) of the Act on a proportionate basis, by following the decision of the Bombay High Court reported in [2011] 333 ITR 289 (CIT Vs. Brahma Associates). Thus applying the decision of this Court in T.C.Nos.1348 and 1349 of 2007 dated 10.10.2012, we hold that the assessee is entitled to succeed both on the principle of proportionality as well as by reason of the construction on the meaning of the expressio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n in respect of eligible units in the project and even within the block, the assessee is entitled to claim proportionate relief against the units satisfying the extent of built-up area. 38. Similar proposition has been laid down by the Bangalore Bench of the Tribunal in DCIT vs. Brigade Enterprises (P.) Ltd., (2008) 119 TTJ 269 (Bang) and the Pune Bench of the Tribunal in Runwal Multihousing Pvt. Ltd. vs. ACIT in ITA Nos.1015, 1016 and 1017/PN/2011 relating to assessment years 2003- 04 to 2005-06, order dated 21.11.2012. Following the same parity of reasoning, we hold that the assessee is entitled to pro-rata deduction in respect of residential units in the housing project No.7, which have complied with the conditions and were eligible for the deduction under section 80- IB(10) of the Act. However, the said deduction is allowable to the assessee only in respect of units construction of which has been completed upto 31st March, 2008. Accordingly, we direct the Assessing Officer to verify the claim of the assessee in this regard in assessment years 2006-07 and 2007-08 and if the assessee has fulfilled the aforesaid conditions under section 80-IB(10) of the Act, pro-rata deduction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deduction u/s.80IB(10) for A.Yrs. 2004-05 to 2007-08 by relying on various decisions. However, for the A.Y. 2008-09 the Ld.CIT(A) denied the claim of benefit of deduction u/s.80IB(10) by relying on the decision of the Hyderabad Bench of the Tribunal in the case of Sainath Estate Pvt. Ltd.(Supra), the decision of the Mumbai Bench of the Tribunal in the case of Everest Home Construction India Pvt. Ltd. (Supra) and the decision of the Mumbai High Court in the case of Brahma Associates (Supra). 7.1 We find the Pune Bench of the Tribunal in the case of Siddhivinayak Shree (Supra) after considering the decision in the case of Sainath Estate Pvt. Ltd.(Supra), the decision of the Mumbai Bench of the Tribunal in the case of Everest Home Construction India Pvt. Ltd. (Supra) has allowed the claim of proportionate deduction u/s.80IB(10) of the I.T. Act, 1961. The relevant observation of the Tribunal from Para 13 onwards read as under : 13. We have considered the rival arguments made by both the sides, perused the orders of the AO and the CIT(A) and the Paper Book filed on behalf of the assessee. We have also considered the various decisions cited before us. We find the AO in the instant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 24 8 TOTAL 168 39 Project B -Plot No 4 Completion Certificate No Date Completion With reference to date Building No of flats SHOPS BCO/03/146 05/10/2005 05/10/2005 G (Gold) 101 0 BCO/03/146 05/10/2005 05/10/2005 H (Crown) 68 0 TOTAL 169 0 The completion certificate in respect of building I+K in respect of 80 flats is not granted so far by PMC although the assessee has duly applied for the same on 04-04-2006 as per application for occupancy certificate received by PMC on 04-04-2006, a copy of which is placed at Paper Book Page No.12. 14.2 It is the submission of the Ld. Counsel for the assessee that the project A and building I K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same is pending before PMC for technical reasons. 14.5 We find the Pune Bench of ITAT in the case of Hindustan Samuha Awas Ltd. has observed as under : 9. From the above, one this is clear that the date that appear on the Architect s Completion Certificate filed before the local authority is a relevant one. In the instant case, the said date is 25-03-2008 and the assessee filed requisite form before the local authorities intimating the completion of the project. The said certificate/intimation was accepted by the local authority without any amendments or objections. Local authority has not raised any queries on the quality construction of the building or the completion of the same as per the plans approved by such authority. In such circumstances, in our opinion, the delay in obtaining the completion certificate on 10-10- 2008 is certainly not attributable to the assessee and obtaining the said certificate before 31-03-2008 is beyond the control of the assessee. Assessee s job includes the completion of the building in accordance with the approved plans and intimation of the same to the local authority by way of filing the requisite Forms together with the Completion Certifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of is established on record, in a given case, the court may take the view that minor deviation thereof would not vitiate the very purpose for which deduction was being made available. 7. In the present case, the facts are peculiar. The assessee had not only completed the construction two years before the final date and had applied for BU permission. Such BU permission was not rejected on the ground that construction was not completed, but the some other technical ground. In that view of the matter, granting benefit of deduction cannot be held to be illegal 8. In the result, the Tax Appeal is dismissed. 14.8 From the details furnished by the Ld. Counsel for the assessee we find the assessee has allotted the built up area of 944.10 sq.mtrs against 942 sq. mtrs as per condition of sanction before 27-02-2008. Therefore, we find merit in the submission of the Ld. Counsel for the assessee that the assessee has complied with the condition of allotment on 27-02-2008 which is before 31- 03-2008. We find merit in the submission of the Ld. Counsel for the assessee that since the ULC Act was repealed in the year 2009, therefore, PMC/ULC department and Secretariat to Mantralaya are no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould not be complied with because of a stay being granted by MRTP Court. Thus fault of incompletion of construction was not attributable to assessee. In case such a contingency emerges which makes the compliance with provision impossible, then benefit bestowed on an assessee cannot be completely denied. Such liberal interpretation should be used in favour of assessee when he is incapacitated in completing project in time for the reasons beyond his control. In case before us, as stated on behalf of assessee, that assessee submitted certain modifications/rectifications for top floors of building. The said modification/rectification could not be completed as local authority could not approve the modification as their files have been taken over by concern intelligence department for investigation of violation of urban land ceiling Act applicable to land in question at relevant point of time. This fact has not been disputed on behalf of revenue. Thus, assessee was prevented by sufficient reasonable cause which compelled the impossibility on part of the assessee to have completion certificate in time. It is settled legal position that the law always give remedy and the law does wrong to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it has not constructed all the six buildings and 17 row houses for which permission was granted and completion certificate was not obtained before 31-03-2008. It is the submission of the learned counsel for the assessee that it has constructed Building Nos. A, C, D and E and 17 row houses and Building Nos. B F being not feasible was not constructed and the assessee has dropped the idea of construction of the same. It is also the submission of the learned counsel for the assessee that it has applied for completion certificate on 22-01-2004 and since the PMC has a legal problem, which is subjudice, the PMC is not able to grant the completion certificate. It is also the submission of the learned counsel for the assessee that Corporation has started levying municipal taxes, the flat owners have started paying electricity bills and the project on which Building Nos. A, C, D and E and 17 row houses are constructed are on a plot of area of more than 1 acre. Therefore, the assessee is entitled to deduction u/s.80IB(10) on the 4 buildings and 17 row houses which it has completed. 19. We find the Managing Director Shri Pradeep Amrutlal Runwal in his statement recorded during the course ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ould have been constructed they would have been very shabby and been place for non-hygiene in the entire project. Looking at the merits and demerits these wings were not constructed. Further, building just one floor was economically unviable . 20. So far as the first objection of the revenue that completion certificate from PMC has not been obtained by the assessee before 31-03-2008 we find the assessee through his architect vide application dated 22-01-2004 has applied to PMC for occupancy certificate. (Page 119 of the Paper Book). The submission of the learned counsel for the assessee that the PMC has not yet rejected the said application till date could not be controverted by the Revenue. The further submission of the learned counsel for the assessee that all the flat owners/row house owners have been given possession between 26- 10-2002 to 15-01-2007, i.e.prior to 31-03-2008 could not be controverted by the learned DR (Page 55 to 63 of the Paper Book). The learned DR also could not controvert the submission of the learned counsel for the assessee that PMC has started levying municipal taxes and the Electricity Meters are in the name of the flat owners who have started pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee applied for the completion certificate to the Pune Municipal Corporation on 12-3-2008. It has been pointed out before us that the local authority i.e. Pune Municipal Corporation did not raise any objection with regard to assessee's application and the certificate for building 'E' was thereafter issued on 5-5-2008. The moot question is as to whether in such a situation can it be said that the assessee's project did not comply with the condition prescribed in subclause (i) of clause (a) to section 80-IB(10) of the Act whereby the construction was to be completed on or before 31-3-2008. Somewhat similar situation was considered by our co-ordinate Bench in the case of Hindustan Samutha Awas Ltd. (supra) wherein also on the strength of architect's certificate, an application for obtaining completion certificate was moved to the local authority on 25-2-2008 but in actuality the completion certificate was issued by the local authority on 10-10-2008. The Tribunal noticed that the delay in issuing completion certificate was not attributable to the assessee as no objections were raised by the local authority. The Tribunal after considering its earlier decisions in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ority without raising any amendment or objection, as has been asserted by the assessee all along and the delayed issuance of the completion certificate by the local authority on 5-5-2008, albeit after the mandated date of 31-3-2008 cannot be attributed to the assessee. In this background of the matter, we therefore, find ample force in the plea of the assessee that denial of deduction u/s 80-IB(10) on such score is uncalled for. In conclusion therefore, in the instant factual background, we hold that the assessee has complied with the condition of completing the construction of the project within the mandated date of 31-3- 2008 even with regard to building 'E', following the parity of the reasoning lid down in the case of Hindustan Samutha Awas Ltd. (supra). . 14. Sub-clause (i) of clause (a) to section 80-IB(10) of the Act requires that the undertaking, developing and building a housing project completes such construction or before 31-3-2008. In the present case, assessee has factually asserted right from the stage of assessment proceedings, that the construction of building 'E' was complete in all respects as per sanctioned plan and all the flats were handed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Explanation (ii) reads as under : (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. CIT (Appeals) as well as the Tribunal after detailed discussion came to the conclusion that such requirement was not mandatory in nature. In the present case, the assessee had completed the construction well before the last date, namely 31st March 2008 and had also sold several units which was completed and actually occupied, and it also applied for BU permission to the local authority. The local authority, however, for technical reasons, at one stage rejected such application in the year 2006 and thereafter upon revised efforts from the assessee granted the same by order dated 19th March 2009. We have perused the detailed discussion of the CIT(Appeals) as well as the Tribunal on the issue. IN particular, the Tribunal noted that the construction was completed in 2006. Application for BU permission to the Municipal authorities was filed on 15-02-2006 which was rejected on 1-07-06. Several residential units were occupied since the same was don ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cate fulfilling all the requirements with the AMC for issuance of occupancy certificate, which the assessee has done in the present case. Thus, the delay in issuing the occupancy certificate cannot be attributed on the part of the assessee to deny the claimed deduction u/s 80IB(10) of the act on the basis that the project was not completed by 31-3-2008, especially when there is no objection raised by the AMC regarding deviation in the construction of the project approved by the AMC. 8. We have gone through the orders cited by the assessee s representative and find relevant paragraphs are required to be extracted for completion of the order. They are as follows. A. Extract from the decision of the Tribunal in the case of M/s. Satish Bora Associates vide ITA Nos. 713 714/pn/2010 19. . 1. In the case of PMC, the completion certificate in prescribed form issued by the licensed architect etc. who has supervised the construction is furnished with four sets of completion plan under Rule 7.6 of the DC Rules of the PMC. Thereafter PMC is required to return one of the sets duly certified as Completion Plan to the owner along with the issue of full Occupancy Certificate after ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the due date for completing the project. In this connection, it has to be noted that the completion certificate is to be issued by the local authority. The question is, whether CMDA can be considered to be a local authority or not. This issue had come up before the Chennai Bench of the Tribunal in the case of Jain Housing Constructions Ltd. in ITA No.1369/Mds/2009 dated 5.2.2010. In that case, assessee was denied deduction in the absence of completion certificate by the CMDA but completion certificate issued by the Corporation of Chennai was placed on record. The Tribunal in paragraph 3.5 of its order stated that the project layout plan may be required to be approved by the CMDA but as far as the construction of the building is concerned, the local authority, i.e. the Corporation of Chennai is the appropriate authority to regulate the construction as per the building bye-laws and sanction plans. When it is not disputed that the Corporation is the local authority, certificate issued by it cannot be disregarded. The assessee has placed on record the completion certificate issued by the Corporation by way of additional evidence. Since the allowability of the entire deduction depen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ey Homes. The AO also directly called information from the local authorities by issuing summons u/s.133(6) and a letter was issued by the competent authority dated 11th November, 2008, confirming that no completion certificate has been issued by this office. Accordingly, the assessee s claim for deduction u/s 80-IB was declined. Section 80IB clearly defines the date of completion as 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 Authorities , it means Local Authorities is competent to certify the date of completion of Housing Project. The date of issue of such letter by the Local authorities is not so crucial but it should have clearly mentioned the date of completion of project. When the Project is completed on 31.3.2008 and the assessee has informed regarding such completion, the Local Authorities may take its own time for issue of certificate, which may be even after 6-7 months, but the letter so issued by the Local Authorities should clearly mention the date of completion of such project. Merely because such certificate is issued after gap of 8 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Therefore, the delay in grant of the said certificate is certainly not attributable to the assessee. Therefore, in our opinion, the assessee is not defaulter on this account and thus, the AO has erred in denying the deduction u/s 80IA(10) of the Act. Accordingly, the order of the CIT(A) has to be reversed. Thus, the grounds raised in the appeal are allowed. 20.4. In view of the above decisions we are of the considered opinion that since the assessee has done whatever possible on his part, i.e. duly applied to PMC for issue of completion certificate, handed over possession of the flats/row houses to the respective buyers, PMC has started levying municipal taxes and electricity bills paid by respective owners, therefore, deduction u/s.80IB(10) under the facts and circumstances of the case cannot be denied to the assessee for nonreceipt of completion certificate from PMC before 31-03-2008 which was beyond the control of the assessee. This view of ours is fortified by our decision in the case of M/s. Ramsukh Properties Vs. DCIT vide ITA No.84/PN/2011 order dated 25-07-2012 for A.Y. 2007-08 (wherein both of us are parties) wherein it has been held as under: 6. After going throug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... possible, then benefit bestowed on an assessee cannot be completely denied. Such liberal interpretation should be used in favour of assessee when he is incapacitated in completing project in time for the reasons beyond his control. In case before us, as stated on behalf of assessee, that assessee submitted certain modifications/rectifications for top floors of building. The said modification/rectification could not be completed as local authority could not approve the modification as their files have been taken over by concern intelligence department for investigation of violation of urban land ceiling Act applicable to land in question at relevant point of time. This fact has not been disputed on behalf of revenue. Thus, assessee was prevented by sufficient reasonable cause which compelled the impossibility on part of the assessee to have completion certificate in time. It is settled legal position that the law always give remedy and the law does wrong to no one. We agree to proposition put forward by Ld. Departmental Representative that plain reading of section 80IB(10) of the Act suggests about only completion of construction and no adjective should be used alongwith the word co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lectricity charges. The assessee has done everything possible on its part for issuance of completion certificate. Therefore, the assessee cannot be held responsible for non-issuance of completion certificate by PMC since the delay is not attributable to the assessee. 15. The third issue on which the Ld.CIT(A) upheld the disallowance u/s.80IB(10) is that the assessee had constructed shops admeasuring about 9472 sq.ft. out of the aggregate built up area of 1,16,433 sq.ft. and therefore the commercial area is 8.37% of the aggregate built up area and therefore is in excess of the prescribed limit u/s.80IB(10). We find, there is no dispute to the fact that the project, in the instant case, is approved on 11-01-1999 vide commencement certificate No.2117 for Plot No.3. Similarly, the PMC approved the first building plan in respect of Plot No.4 vide commencement certificate No.4410 dated 06-03-2000. Thus, the housing project has been approved before 31-03-2005. It has been held by the Hon ble Bombay High Court in the case of CIT Vs. Brahma Associates reported in 333 ITR 289 that the housing project approved before 31-03-2005 can include commercial area. It is the case of the Revenue tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee commenced the development is to be applied and accordingly it was held that the assessee was entitled to deduction u/s.80IB(10) for A.Y. 2006- 07 15.3 The Pune Bench of the Tribunal in the case of Opel Shelters Vs. ACIT vide ITA No.219/PN/2009 and D.S. Kulkarni and Associates vide ITA Nio.17/PN/2009 following the decision of the Mumbai Bench of the Tribunal in the case Hiranandani Akruti JV (Supra) has held that in those approved projects where construction has been started much earlier than 01-04-2005, the assessees are required to complete the plan as it has been approved. 15.4 In view of the decision of Hon ble Gujarat High Court in the case of Manan Corporation(Supra) it has to be held that the law as existed in the year when the assessee submitted its proposal and the permission is granted by the local authority and the assessee commences development is to be applied in determining its eligibility of the deduction claimed u/s.80IB(10). The assessee in the instant case cannot be denied the benefit of deduction for construction of commercial area which is more than 2000 sq.ft. or 5% of the built up area of the housing project whichever is less. It has been held by var ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be adjudicated. 7.2 Similarly, the Pune Bench of the Tribunal in the case of M/s. Raviraj Kothari Punjabi Associates (Supra) after considering the decision of Hon ble Mumbai High Court in the case of Brahma Associates (Supra) and the decision of the Mumbai Bench of the ITAT in the case of Everest Home Construction (India) Pvt. Ltd. (Supra) has allowed the claim of proportionate deduction by observing as under : 6. So, however, at the time of hearing the Ld.CIT DR appearing for the Revenue contended that the Tribunal held that the restrictions on permissible commercial area as per section 80IB(10)(d) of the Act was inserted by the Finance (No.2) Act 2004 w.e.f.01-04-2005 and that such amendment was prospective in nature and would not apply to the project in question. The Ld. CIT DR submitted that in this context the Mumbai Bench of the Tribunal in the case of ITO Vs. Everest Home Construction (India) (P) Ltd. vide ITA No.7021/Mum/2008 order dated 12-09-2012 has taken a contrary view to hold that the commercial area limit introduced by the Finance (No.2) Act 2004 w.e.f.01-04-2005 by insertion of Clause (d) section 80IB(10) shall be applicable to evaluate the deductions clai ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a project which is approved prior to 01-04-2005 and that in this light the prospective nature of the amendment, as held by the Hon ble Bombay High Court, is to be viewed. 9. Pertinently in the case before Hon ble Gujarat High Court the claim of the assessee was denied by the Tribunal relying on the judgement of the Hon ble Bombay High Court in the case of Brahma Associates (Supra) holding that the restriction set out in Clause(d) of section 80IB(10) inserted by Finance (No.2) Act 2004 w.e.f.01-04-2005 was to be applied in A.Y. 2006-07, regardless of the date of approval of the project in question. The aforesaid position canvassed by the Tribunal in the case of Manan Corporation (Supra) was negated by the Hon ble Gujarat High Court on the basis of the judgment of the Hon ble Bombay High Court in the case of Brahma Associates (Supra). Therefore, in this manner, the reliance now sought to be placed by the Ld. CIT DR in the case of Everest Home Construction (India) Pvt. Ltd. (Supra) therefore is not of any help to the Revenue. Thus, following the parity of reasoning laid down in the order of the Tribunal dated 23-11- 2012 (Supra), in assessee s own case, and which is in consonance w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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