2017 (4) TMI 1522 - AT - Income Tax

Tribunal upholds deduction for housing project under section 80IB(10)

The ACIT, Circle-6, Surat Versus Smt. Sarla Rajkumar Verma

The Tribunal affirmed the CIT(A)'s decision to allow a deduction under section 80IB(10) of the Income Tax Act to the assessee for Assessment Year 2010-11. ... Disallowance of deduction u/s.80IB - as per AO permission for construction first was granted by the Surat Urban Development Authority (SUDA) on 05.02.1997 which was to be completed on or before 31.03.2008 for claiming deduction but the same was actually completed on 01.10.2010 - CIT-A allowed deduction - HELD THAT:- SUDA had given permission as on 5th Feb, 1997 to its erstwhile owners for making plots and thereafter construction to plinth and out of those plots, two plots were purchased by this Hemant I Desai as on 27th March, 2000 which was subsequently purchased by the father of the assessee which in turn came in possession of the assessee. As noticed from the supporting material that the permission to develop housing project was obtained on 23rd Feb, 2007 which was revised on 17nd September, 2009 and as per the permission the housing project was completed on 31st March, 2010. CIT(A) has elaborated in his findings and order that the condition of completion of project within prescribed time were fulfilled by assessee in her case. After considering the above facts and detailed order of the Ld.CIT(A) we do not find any reason to interfere in the findings of the Ld.CIT(A). - Decided against revenue. Issues:Appeal against deduction disallowance under section 80IB(10) of the Income Tax Act, 1961 for Assessment Year 2010-11.Analysis:The revenue appealed against the CIT(A)'s decision to allow a deduction of Rs. 90,41,235 to the assessee, which was earlier disallowed by the Assessing Officer under section 80IB(10) of the Income Tax Act. The assessing officer had observed that the housing project did not meet the completion deadline as required by the Act. The CIT(A) considered the facts and submissions, noting that the permission granted in 1997 was for the previous owner, not the appellant. The CIT(A) clarified the ownership history of the land and highlighted that the project was completed within the stipulated time frame after revisions in permissions. The CIT(A) concluded that the assessing officer had erred in disallowing the deduction and allowed the claim of the assessee.The Tribunal reviewed the contentions and evidence presented by both parties. It noted the permission history of the land and the revised permission for the housing project, which was completed within the prescribed time frame. The Tribunal found that the CIT(A) had provided detailed reasoning and upheld the decision to allow the deduction. Consequently, the Tribunal dismissed the revenue's appeal against the CIT(A)'s order, affirming the allowance of the deduction to the assessee for the Assessment Year 2010-11.In summary, the Tribunal upheld the CIT(A)'s decision to allow the deduction under section 80IB(10) to the assessee, emphasizing the fulfillment of project completion requirements within the specified time frame. The Tribunal found no grounds to interfere with the CIT(A)'s findings, leading to the dismissal of the revenue's appeal.