2017 (1) TMI 445 - AT - Income Tax

ITAT Mumbai grants 80IB(10) deduction, upholds completion timeline, assures consistency

Rattanchand Rikhabdas Jain Versus The Income Tax Officer, Ward 14 (3) (4), Mumbai

The Appellate Tribunal ITAT Mumbai allowed the deduction u/s 80IB (10) of the Income Tax Act for the assessee, overturning the CIT (A)'s decision. The ... Claim of deduction u/s 80IB (10) - denial of claim for want of evidence that the project was completed within this stipulated time limit i.e. 31-03-2013 - Held that:- Before us the learned Counsel for the assessee Shri Percy Pardiwala took us through the completion certificate granted by BMC vide dated 10-09-2007 in respect of this project.The learned counsel further took us through occupation certificate issued by Municipal Corporation of Grater Mumbai vide CE/1154/BPES/AS dated 26-02-2013 and also another approval CE/1154/BPES/AS dated 04-03-2013 this approvals covers full occupation permission for blocks “A”, “B”, “C”, “D” and “E” of building comprising of stilt + 1st to 19th + (part) 20th upper floors and ground floor of this project. As regards to the withdrawal of claim for AY 2012-13, the learned Counsel for the assessee stated that due to wrong impression, the assessee first withdrawn his claim and then revised the same claim before the AO by filing a revised return for AY 2012-2013 dated 03-03-2014 during the pendency of assessment proceedings. The learned counsel for the assessee informed that this claim is pending before CIT (A) for the AY 2012-13. In view of the above facts, the learned Counsel for the assessee stated that the building was completed on 31-03-2013 and not otherwise, as alleged by the CIT (A) in his order. We find from the above facts that the project is completed and occupation in respect of all the blocks that is “A”, “B”, “C”, “D” and “E” are obtain within stipulated time limit of 31-03-2013 and there is no violation of any of the conditions mentioned in the provisions of Section 80IB (10) of the Act. Accordingly we have no hesitation in allowing this claim of assessee - Decided in favour of assessee Issues:Appeal against disallowance of deduction u/s 80IB (10) of the Income Tax Act based on completion of a housing project within stipulated time limit.Analysis:1. Issue of Disallowance of Deduction u/s 80IB (10):- The appeals arose from orders of CIT (A) disallowing the claim of deduction u/s 80IB (10) of the Act due to lack of evidence regarding completion of the project within the stipulated time limit of 31-03-2013.- The Assessing Officer disallowed the claim citing the sale of flats to one family as a violation of conditions u/s 80IB (10) (e) and (f) of the Act.- CIT (A) allowed the claim on the issue of allotment of flats but confirmed the disallowance based on the project approval date and completion status by 31-03-2013.- The Tribunal analyzed the evidence presented, including completion and occupation certificates, to establish that the project was indeed completed within the stipulated time frame.- The Tribunal found no violation of conditions specified in Section 80IB (10) and allowed the claim of deduction for the assessee.2. Judicial Interpretation of Statutory Provisions:- The judgment delves into the statutory provisions of Section 80IB (10) of the Income Tax Act, emphasizing the conditions related to project completion, unit allotment, and other requirements for claiming deductions.- The Tribunal scrutinized the timeline of project approval and completion as per the statutory provisions to determine the eligibility of the assessee for the deduction.3. Legal Analysis of CIT (A) and Tribunal Findings:- CIT (A) based its decision on the inability of the assessee to prove project completion within the specified time limit, leading to the disallowance of deduction u/s 80IB (10).- The Tribunal, after a detailed examination of the evidence and submissions, concluded that the project was completed within the prescribed timeframe, thereby overturning the CIT (A)'s decision and allowing the deduction.- The Tribunal highlighted the significance of documentary evidence, such as completion and occupation certificates, in establishing compliance with statutory requirements for claiming deductions under Section 80IB (10).4. Consistency in Judicial Approach:- The Tribunal maintained a consistent approach in allowing the deduction for both assessment years 2010-11 and 2011-12, emphasizing the completion of the housing project within the stipulated time limit as the decisive factor in determining the eligibility for the deduction.- By aligning its decision with the factual and legal analysis, the Tribunal ensured a uniform application of the law across the appeals, thereby upholding the assessee's entitlement to the claimed deduction.In conclusion, the judgment by the Appellate Tribunal ITAT Mumbai in the cited case addressed the crucial issue of disallowance of deduction u/s 80IB (10) of the Income Tax Act, focusing on the completion status of the housing project within the specified time frame. Through a meticulous review of evidence and statutory provisions, the Tribunal overturned the CIT (A)'s decision and allowed the deduction for the assessee, emphasizing compliance with the statutory conditions as the determining factor. The consistent approach adopted by the Tribunal in both assessment years underscored the importance of factual substantiation and legal interpretation in resolving tax disputes effectively.