TaxTMI 
TaxTMI 
2013 (10) TMI 758
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....led for the assessment year 2007-08, assessee claimed deduction u/s 80- IB(10) of the Act of Rs. 14,28,01,695/- in respect of profits derived from the said project. The Assessing Officer denied the claim of deduction u/s 80-IB(10) on two grounds. Firstly, as per the Assessing Officer, assessee was required to complete construction of the project by 31-3-2008 in terms of section 80- IB(10)(a)(i) of the Act whereas, the assessee completed the construction beyond the said date. Secondly, as per the Assessing Officer, built-up area of certain residential units in the housing project exceeded 1500 sq.ft., which was violative of clause (c) to section 80-IB(10) of the Act. On the above grounds, the claim of deduction u/s 80-IB(10) amounting to Rs. 14,28,01,695/- was denied. 3. The assessee carried the matter in appeal before the CIT(A) and assailed both the objections of the Assessing Officer on assessee's claim for deduction u/s 80-IB(10) of the Act. The CIT(A) accepted the plea of the assessee that construction of the project was complete within the period applicable in the present case, which was to be seen in terms of clause (ii) to section 80- IB(10)(a) and not as per clause (i) t....
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....T(A) however, emphasized that the assessee had combined the adjacent flats during the construction phase of project itself and therefore, it was not a case where individual flat owners have combined the flats on their own subsequent to completion of the project and consequent taking over of possession by them. For the aforesaid reason, it was held that the assessee had violated the condition prescribed u/s 80-IB(10)(c) of the Act with respect to 17 such flats. Therefore, the deduction claimed u/s 80-IB(10) of the Act has been denied with respect to the entire project. 6. On the aforesaid aspect, before us no new arguments have been raised. Factually speaking, it is not in dispute that the built up area of the 17 combined flats in question exceeded 1500 sq.ft. each and therefore, it was violative of the condition prescribed in sec. 80-IB(10)(c) of the Act. Accordingly, the aforesaid aspect of the matter is decided in consonance with the stand of the Revenue. 7. So however, the case built up by the assessee before us is that even if the aforesaid plea of the Revenue is to be upheld, the deduction u/s 80-IB(10) of the Act be denied only in relation to the profits derived from su....
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....d the said petition by specifically mentioning that the same was misconceived. In fact, the Hon'ble High Court has not considered anything concerning the merit of the issue that whether in the circumstances of the case, the assessee could claim deduction u/s 80-IB(10) of the Act or not. The Hon'ble High Court clarified that it was still open for the assessee to appeal against the finding of the Tribunal on merits of the issue in appeal before the High Court permissible u/s 260A of the Act. Therefore, it would not be appropriate to hold that the order of the Tribunal dated 13-10-2008 in the case of Vishwas Promoters (P) Ltd. (supra) has been upheld by the Hon'ble High Court of Madras in the light of its judgment dated 11-9-2009 (supra). Clearly, the arguments advanced by the learned CIT-DR based on the decision of the Hon'ble Madras High court in the case of Vishvas Promoters (P) Ltd. dated 11-09-2009 (supra) are not in correct perspective. In fact, similar argument was considered by the Third Member in the case of Sanghavi & Doshi Enterprises (supra), and was rejected. Therefore, we do not find the aforesaid argument of the Revenue to be potent, so as to distract from the ratio of ....
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....s could be considered as a project by itself considering that it was a part of an earlier approved project. The judgment of the Hon'ble High court in the case of Vandana Properties (supra) has to be appreciated only in this context. Therefore, the issue before us i.e. in case where certain residential units of a project have builtup area in excess of 1500 sq.ft. would result in the loss of exemption for the entire project or not and whether the assessee would be entitled to a proportionate deduction, was not an issue before the Hon'ble Jurisdictional High court in the case of Vandana Properties (supra). Therefore, the said decision does not come to the rescue of the Revenue. 12. In this case, factually, it is not in dispute that so far as the built-up area of 17 flats is concerned, the same is beyond the limit prescribed in clause (c) to section 80-IB(10) of the Act. The plea of the assessee is that the entire project could not be held ineligible for deduction u/s 80-IB(10) of the Act. The assessee contends that the deduction u/s 80-IB(10) of the Act be allowed with respect to the profits derived from the development and construction of residential units in the said project whic....