TaxTMI 
TaxTMI 
2012 (6) TMI 319
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....for completion of the project within four years of the year in which the first building plan was passed applied to the assessee's case although the first building plan was passed before the introduction of this condition in section 80IB(10). (b) the project consisted of 16 buildings and as the assessee had not completed the construction of all these buildings, the condition of completing the housing project u/s 80IB(10) was not fulfilled. (c) the concept of a 'project' as per section 80IB(10) was to be understood as per the sanctioned layout for the entire land and the condition in section 80IB(10) required the assessee to complete the construction of all the buildings shown in the layout plan within four years. (d) the assessee's stand that 11 buildings namely A1 to A5 and B1 to B6 covering the land of more than one acre were completed and hence, these buildings together constituted a project and the deduction ought to have been allowed in respect of the profits from these buildings is not a correct stand. (4) The CIT(A) failed to appreciate that - (a) the first building plan of the assessee was passed before 1.4....
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....on below Sec. 80IB(10)(a) of the I.T. Act, the A.O held that as per the Explanation (i) when the approval in respect of the housing project was obtained more than once, the very first approval was the date to be taken for the approval of the project for the purpose of Sec. 80IB(10)(a) of the Act. The A.O. stated that in this case, the date of approval of the project was 3.4.2003, therefore, Sec. 80 IB(10)(a) required that the project should have been completed on or before 31st March 2008, which was not fulfilled by the assessee in respect of the entire project comprising of A to D, type of buildings. 3. The contention of the assessee remained that the housing project consisted 16 buildings in a total area of 20 acres and 5 different lay out plans and accordingly different building plans were sanctioned from 3.4.2003 to 13.7.2003. Five buildings i.e. A1 to A 5 known as "Atul Nagar" were sanctioned as per amended lay out plans dated 27.6.2003, 3.10.2003 and 20th April 2004. Further, 6 buildings B1 to B 6 were constructed on the basis of lay out plans sanctioned on 15.9.2004 and 8.3.2006. It was stated that these 6 buildings known as "Rahul Nisarg Co-operative Housing Society Ltd.....
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....hat the assessee has completed only A & B type of buildings by this date and the other buildings in C & D type are still under construction and therefore, he held that the assessee had not completed this project within four years and accordingly, he has disallowed the claim of deduction u/s 80IB(10). (2) In the paper book on page no. 4 the assessee has given the first plan which was sanctioned on 29/4/2003. Thereafter, the plan was revised a few times and on page no. 5, the assessee has given the final plan as per which the buildings of A & B Group were completed. This final plan was passed on 8.3.2006. The A group consisted of five buildings namely A1 to A5 and which cluster is called Atul Nagar. The B group buildings cost of six buildings B 1 - B 6 and this cluster is called Rahul Nisarg. Both these clusters are separately registered societies and they have their separate amenities. The particulars regarding these clusters are as under - (3) Cluster of A buildings - Atul Nagar (i) Approval of the project by local authority before 31/3/2007. The 1st building plan for A type has been sanctioned by Pune Municipal Corporation on 29/4/2003 vide com....
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....at the term ''housing project" is not defined anywhere under the Income Tax Act, therefore, there is a possibility of different views on the subject leading to protracted litigation. The Maharashtra Chamber of Housing Industry vide its letter dated 1^st January 2001 had requested for clarification under the provisions of Sec. 10(23G) of the I.T. Act 1961 from the Hon'ble Finance Minister, Government of India. It was requested in the said letter that suitable clarification be made to define the term "housing project" to include various amenities and facilities, inter alia, including that of a convenient shopping etc. The said letter was replied by the CBDT vide its letter dated 4th May 2001. The Ld. A.R. referred the relevant extract of the said letter of CBDT i.e. "with regard to your query regarding the definition of housing project which has been approved by local authority as a housing project should be considered adequate for the purpose of Sec. 10(23G) and Sec. 80IB(10)". The Ld. AR. Referred page Nos. 1 to 71 of the paper book i.e. copies of profits and loss account for A & B type projects; Profit & Loss A/C for C & D Type Project; Commencement Certificate For A Type Project,....
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.... Considering the above submission, and having gone through the orders of the authorities below, material available on record and the decisions relied upon, we find that the issue involved is as to whether the assessee had completed the housing project within the prescribed time limit since the date of first approval of the project by the PMC. 9. To decide the above issue, it is necessary to decide firstly as to what would be first date of approval of the housing project by the PMC to compute the time limit prescribed for completion of the project to take benefit of deduction u/s. 80IB(10) of the Act. There is no dispute on some material facts that out of 16 buildings in the housing project of the assessee only 11 buildings were completed within the prescribed time limit upto 31st March 2008. The lay out plan in respect of entire complex was sanctioned by PMC vide order No. DPO/45/D/646 dated 3.4.2003 and the building plan was sanctioned vide Commencement Certificate No. 4269 dt. 29.4.2003. Admittedly, the term "housing project" has not been defined in the Income Tax Act but in the context of deduction u/s. 80IB(10) an Explanation has been provided below clause (a) to sub-section....
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....ncement certificate in respect of six wings in Block 'N' was separately received by the assessee and all the flats in Block were less than 1000 sq.ft. It was held by the Tribunal that it is not upon to the revenue to include block 'BC' as part of block 'N' just to deny relief to the assessee u/s. 80 IB(10). The Tribunal observed that Block "BC" was meant for higher strata of the Society had been kept separately by assessee in all the respect, assessee had not claimed relief u/s. 80IB in respect of Block "BC". In the case of Mudhit Madanlal Gupta (supra) before the Mumbai Bench, it has been held that the housing project does not necessarily have to be various group of buildings constructed on that particular land, but it can also be a particular building or any building which is part of a large project. It has been further held that whatever portion of the housing project is otherwise found to be eligible has to be considered as a housing project for the purpose of deduction u/s. 80 IB (10) of the Act. Similar view has been expressed by Mumbai Bench of the Tribunal in the case of Vandana Properties (supra). 10. In view of above discussion, we come to the conclusion that for verif....
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....ceed 1500 sq.ft. It is also not in dispute that both the projects are entirely a residential project and there is no commercial area therein. Under the above circumstances, we are of the view that the assessee is very much entitled to the claimed deduction u/s. 80 IB (10) of the Act on the buildings A1 to A5 in "Atul Nagar" and buildings B1 to B6 in "Rahul Nisarg Co-operative Housing Society Ltd." The issue is therefore decided in favour of the assessee. We thus while setting aside the orders of the authorities below on the issue, direct the A.O to allow the claimed deduction u/s. 80IB(10) in question. The related grounds are accordingly allowed. 11. In result, appeal is allowed. ITA No. 707/PN/2010 12. The first appellate order has been questioned by the assessee on the following grounds : "(1) The CIT(A) erred in confirming the disallowance of deduction of Rs. 18,43,29,768/- u/s. 80IB(10) in respect of the housing project constructed by the assessee at Warje, Pune. (2) The CIT(A) erred in holding that the assessee's project consisted of 16 buildings as per the sanctioned layout plan on the plot of land of about 20 acres and as all these buildings were n....