Income Tax Appellate Tribunal - Mumbai
Sonam Builders, Mumbai vs Department Of Income Tax on 20 June, 2012
आयकर अपील य अ धकरण "ई" यायपीठ मुंबई म।
IN THE INCOME TAX APPELLATE TRIBUNAL "E" BENCH, MUMBAI ी संजय अरोड़ा, लेखा सद य एवं ी अ मत शु ला, या यक सद य के सम ।
BEFORE SHRI SANJAY ARORA, AM AND SHRI AMIT SHUKLA, JM आयकर अपील सं./I.T.A. No. 5634/Mum/2012 ( नधारण वष / Assessment Year: 2009-10) Asst. CIT, Circle-2, Sonam Builders 1st Floor, Quresh Mansion, A-304, Akash Ganga Bldg., Gokhale Road, Naupada, बनाम/ Devchand Nagar, Jain Mandir Road, Thane (W) - 400 602 Vs. Bhayander (W), Dist. Thane-421 101 थायी ले खा सं . /जीआइआर सं . /PAN/GIR No. AACFS 3498 J (अपीलाथ /Appellant) : ( यथ / Respondent) अपीलाथ क ओर से / Appellant by : Shri Maurya Pratap यथ क ओर से/Respondent by : Shri Vimal Punmiya सनु वाई क तार ख / : 19.05.2014 Date of Hearing घोषणा क तार ख / : 19.05.2014 Date of Pronouncement आदे श / O R D E R Per Sanjay Arora, A. M.:
This is an Appeal by the Revenue directed against the Order by the Commissioner of Income Tax (Appeals)-II, Thane ('CIT(A)' for short) dated 20.06.2012, allowing the assessee's appeal contesting its assessment u/s.143(3) of the Income Tax Act, 1961 ('the Act' hereinafter) for the assessment year (A.Y.) 2009-10 vide order dated 07.12.2011.2 ITA No.5634/Mum/2012 (A.Y. 2009-10)
Asst. CIT vs. Sonam Builders
2. At the very outset, it was submitted by the ld. Authorized Representative (AR), the assessee's counsel, that the issue arising in the instant case stands covered by the decision by the Hon'ble jurisdictional High Court in the case of CIT vs. Brahma Associates [2011] 333 ITR 289 (Bom.) and, following it, by the hon'ble court in its own case for A.Ys. 2003-04 & 2004-05 (in ITA No.1420 of 2011 & 1598 of 2011 dated 06.08.2012/PB pg.1). In fact, the tribunal has also, following the same, dismissed the Revenue's appeal for f.y. 2006-07, challenging the disallowance of deduction u/s.80-IB(10) to the assessee on its construction project 'Golden Nest' (in ITA No.4607/Mum(E)/2011 dated 18.07.2012/PB pgs.2-9), taking us through the relevant part of the said order. The same stand was adopted by the tribunal for A.Y. 2008-09 (PB pgs. 11-15). The ld. Departmental Representative (DR) on being enquired by the Bench in the matter, could not controvert the said statement by the ld. AR.
3. We have heard the parties, and perused the material on record. 3.1 The controversy in the present case is on account of two aspects of deduction u/s.80-IB(10), pertaining to different qualifying conditions as specified in the provision. The same stand agitated separately by the Revenue per its grounds, as under:
'1. On the facts of the case and in law, the ld. CIT(A) erred in deleting an addition of Rs.40,35,261/- made on account of denial of assessee's claim of deduction u/s.80IB(10) without appreciating the findings of the A.O. regarding violation of eligibility conditions prescribed for claim of deduction u/s.80IB(10) of the Act.
2. The ld. CIT(A) erred in directing the A.O. to allow deduction u/s.80IB(10) even though the commercial area exceeds 5% of the total built up area relying on the decision of Brahma Associates vs. Joint Commissioner of Income Tax [2009] 122 TTJ (Pune)(SB) 433 which has not been accepted by the department.
3. On the facts of the case and in law, the ld. CIT(A) erred in allowing the assessee's claim of deduction despite the fact that a single unit exceeded 1000 sq. ft. which is a violation of the provision u/s.80IB(10) of the I. T. Act.' 3 ITA No.5634/Mum/2012 (A.Y. 2009-10) Asst. CIT vs. Sonam Builders While Gd. no. 1 is general in nature, grounds 2 & 3 raise the specific issues arising in the instant case. We shall take both of them separately, in seriatim.
3.2 The deduction under reference is in respect of Phases VII, X, XI and XIA of a housing construction project by the name 'Golden Nest'. The same bearing commercial area in excess of the prescribed percentage of 5% of the aggregate built up area, or 2000 sq. ft., whichever is less, the same was considered as barred for deduction u/s.80-IB(10).
The hon'ble jurisdictional high court, per its decision in the case of Brahma Associates (supra), has clarified that a housing project approved upto 31.03.2005, commercial user to the extent permitted under the development control rules/regulations framed by the respective local authority would hold in-as-much as the amendment in law, prescribing the said limitation came w.e.f. 01.04.2005. In the present case, it is undisputed that Phases VII and X were approved by the local authority on 25.01.2001 and Phases XI and XIA on 14.01.2004, i.e., both prior to 01.04.2005 w.e.f. from which date clause (d) stands inserted to section 80-IB(10). Accordingly, the said amendment would, in terms of the cited decision by the hon'ble jurisdictional high court, have no bearing on the allowability of the deduction under the provision for the said phases of the housing project under reference, which as it appears are reckoned as separate housing projects for the purpose of s. 80-IB(10). This is also the basis on which relief stands allowed by the tribunal to the assessee for the earlier year, i.e., A.Y. 2006-07. Respectfully following the decision by the hon'ble high court, we admit and accept the assessee's case for the current year as well, allowing ground no. 2.
3.3 The second aspect, raised by the Revenue per its ground no. 3, is in respect of the construction of residential units exceeding 1000 sq. ft., so that the qualifying condition of section 80-IB(10)(c) stands not met. Toward this, no specific argument was raised before us by the ld. AR. A perusal of the impugned order (para 9) though would show that the assessee contended before the ld. CIT(A) that this issue is no longer relevant for the current year in-as-much as no deduction stands claimed (in respect of the relevant project) for the current year. We find that on merits, while the tribunal has confirmed the 4 ITA No.5634/Mum/2012 (A.Y. 2009-10) Asst. CIT vs. Sonam Builders disallowance at Rs.6.70 lacs for A.Y. 2004-05, as also for A.Y. 2006-07, perhaps on a proportionate basis, the hon'ble jurisdictional high court has in Brahma Associates (supra) clarified that a 'housing project' being not defined under the Act, it is that as approved by the local authority that would obtain. Further, it is the housing project as approved which is either eligible u/s.80-IB(10) or not so and, as such, deduction there- under, where so, would be available for the entire project and not to a part thereof. Be that as it may, our concern, in view of the finding of the ld. CIT(A), which is not on merits, in the matter would be as to whether the said issue arises in the facts of the present case; the ld. CIT(A) finding it as not so; in fact, dismissing the assessee's ground for statistical purposes. Toward this, we observe that the issue of the area of a residential house/s exceeding 1000 sq. ft. arises in respect of the row houses, which the Revenue claims to be in fact a duplex house, for Phase VII of the housing project. A perusal of the details of the deduction u/s.80-IB(10) for the current year reveals a claim in the negative sum of Rs.15,565/- for the said Phase, so that no positive deduction stands claimed for the current year. We, accordingly, confirm the said issue, raised by the Revenue per its ground no. 3, as not arising in the facts of the present case. We refrain to, in view of the foregoing, dwell on the merits of the case, which as afore-noted was not argued. The said ground, therefore, stands accordingly dismissed as unfructous. We decide accordingly.
4. In the result, the Revenue's appeal is dismissed.
प रणामतः राज व क अपील खा रज क जाती है ।
Order pronounced in the open court on May 19, 2014
Sd/- Sd/-
(Amit Shukla) (Sanjay Arora)
या यक सद य / Judicial Member लेखा सद य / Accountant Member
मुंबई Mumbai; दनांक Dated : 23.05.2014
व. न.स./Roshani, Sr. PS
5
ITA No.5634/Mum/2012 (A.Y. 2009-10)
Asst. CIT vs. Sonam Builders
आदे श क त ल प अ े षत/Copy of the Order forwarded to :
1. अपीलाथ / The Appellant
2. यथ / The Respondent
3. आयकर आयु त(अपील) / The CIT(A)
4. आयकर आयु त / CIT - concerned
5. वभागीय त न ध, आयकर अपील य अ धकरण, मुंबई / DR, ITAT, Mumbai
6. गाड फाईल / Guard File
आदे शानस
ु ार/ BY ORDER,
उप/सहायक पंजीकार (Dy./Asstt. Registrar)
आयकर अपील य अ धकरण, मुंबई / ITAT, Mumbai