Housing project deduction under Section 80IB(10) cannot be withdrawn without factual changes, separate approved blocks qualify independently

ITAT Ahmedabad held that deduction under Section 80(IB)(10) for housing projects cannot be withdrawn in subsequent years without change in facts. For POR project, assessee was eligible for deduction as GUDA maintained in-principal approval was granted on 30.03.2007, and CIT(A)'s factual findings were not disputed with substantive evidence. For PMC project, assessee was entitled to deduction for 349 units where BU permission was obtained, despite lacking permission for remaining 27 units, as approved blocks were separate and distinguishable from unapproved ones.

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Issues Involved:
1. Eligibility for deduction under Section 80IB(10) of the Income-tax Act for the Parshwanath Om Residency Project (POR Project).
2. Eligibility for deduction under Section 80IB(10) of the Income-tax Act for the Parshwanath Metro City Project (PMC Project).

Summary:

Issue 1: Deduction under Section 80IB(10) for POR Project
- Department's Argument: The Ld. CIT(A) erred in allowing the deduction as the approval from the local authority was not obtained before 31.03.2008, violating clause (a)(i) of Section 80(IB)(10).
- Assessing Officer's Observations: The actual approval from GUDA was taken on 27.10.2010, not before 31.03.2008.
- Assessee's Argument: Approval for the POR Project was obtained on 30.03.2007, and the letter dated 27.10.2010 was a revised development permission.
- CIT(A)'s Findings: Approval was indeed obtained on 30.03.2007, as supported by GUDA's letter dated 12.06.2017. The project met all conditions under Section 80-IB(10).
- Tribunal's Decision: The Ld. CIT(A) correctly allowed the deduction, as the approval date was 30.03.2007, and the Department did not provide substantive evidence to dispute this.

Issue 2: Deduction under Section 80IB(10) for PMC Project
- Department's Argument: The assessee did not complete the entire project of 376 units before 31.03.2012, violating clause (a)(iii) of Section 80(IB)(10).
- Assessing Officer's Observations: BU permission was given for only 349 units out of 376.
- Assessee's Argument: BU permission was obtained for 349 units, and deduction was claimed only for these units. The remaining units in three blocks were separate and independent.
- CIT(A)'s Findings: The assessee was entitled to pro-rata deduction for the completed units, as supported by various judicial precedents.
- Tribunal's Decision: The assessee is eligible for deduction under Section 80-IB(10) for the units for which BU permission was obtained. The denial of deduction for the entire project was not justified.

Conclusion:
The appeals by the Department for both A.Y. 2013-14 and A.Y. 2014-15 are dismissed. The assessee is entitled to deductions under Section 80-IB(10) for both the POR and PMC projects as per the findings of the CIT(A) and supported by judicial precedents.

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