Court overturns CBDT rejection, approves petitioner for Industrial Park Scheme, 2008 deductions

The court found in favor of the petitioner, setting aside the CBDT's rejection of their application for approval and notification of their industrial park under the Industrial Park Scheme, 2008. The court determined that the petitioner had substantially complied with the scheme's requirements by developing infrastructure and allocating plots to industries before the deadline. The CBDT was directed to approve the petitioner for deductions under section 80-IA(4) upon submission of a completion certificate from GIDC by September 30, 2016.

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Issues Involved:
1. Rejection of approval and notification of the industrial park under the Industrial Park Scheme, 2008.
2. Requirement of completion certificate from a local authority.
3. Evidence of project completion before the specified date.
4. Interpretation of the term "completion" under the Industrial Park Scheme.

Detailed Analysis:

1. Rejection of Approval and Notification:
The petitioner challenged the Central Board of Direct Taxes (CBDT) order dated November 5, 2014, which rejected their application for approval and notification of their industrial park under the Industrial Park Scheme, 2008. The rejection hindered the petitioner from claiming deductions under section 80-IA(4) of the Income-tax Act, 1961.

2. Requirement of Completion Certificate from a Local Authority:
The CBDT's order highlighted the absence of a completion certificate from a local authority, which is a requirement under the Industrial Development Scheme of 2008. The petitioner provided various documents, including certificates from MARS Planning and Engineering Services Pvt. Ltd. and the Industries Commissioner, but these were not accepted by the CBDT. The CBDT insisted that the project completion certificate must be obtained from the Ahmedabad Urban Development Authority (AUDA).

3. Evidence of Project Completion Before the Specified Date:
The petitioner argued that the industrial park was completed before the extended deadline of March 31, 2011, and presented several documents to support this claim:
- A completion report dated September 5, 2010, from MARS Planning and Engineering Services Pvt. Ltd.
- A project completion certificate dated April 8, 2013, from the Industries Commissioner, Government of Gujarat.
- Various certificates and letters from AUDA.

The CBDT, however, found these documents inconclusive, noting discrepancies such as the absence of a specific completion date and the fact that only one unit was completed by June 17, 2010. The CBDT concluded that the project was actually completed sometime in 2013, not before March 31, 2011.

4. Interpretation of the Term "Completion" Under the Industrial Park Scheme:
The court analyzed the CBDT's insistence on the completion of industrial units within the park, referencing the case of Ganesh Housing Corporation Ltd. v. Padam Singh, Under Secretary. The court clarified that the requirement under the scheme was the completion of infrastructural facilities, not the commencement of production by the units. The petitioner had fulfilled the requirement by developing the infrastructure and allocating plots to various industries before the deadline.

Conclusion:
The court found that the CBDT had erred in its interpretation and application of the scheme's requirements. The evidence provided by the petitioner, including the certification by MARS Planning and Engineering Services Pvt. Ltd. and the approval of the subsidy by the State Level Committee, indicated substantial compliance with the scheme. The court set aside the CBDT's order and allowed the petitioner to produce a completion certificate from GIDC, a local authority, by September 30, 2016. If provided, the CBDT was directed to approve the petitioner for the deduction under section 80-IA(4) and issue the necessary notification within three months of receiving the certificate. The petition was allowed and disposed of accordingly.

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