TaxTMI 
TaxTMI 
TaxTMI 
2015 (4) TMI 41
X X X X Extracts X X X X
X X X X Extracts X X X X
....finition of built up area. 3) The learned Commissioner of Income tax (Appeals) erred in holding that the assessee is eligible for deduction u/s.80IB(10) without appreciating that as per provisions of section 80IB(14)(a) built up area is to be calculated taking into account all the projections and balconies and as such the flats on the first floor of building B exceeded the built up area of 1500 sq.ft. making the assessee ineligible for deduction u/s.80IB(10) of the Act. 4) The learned Commissioner of Income tax (Appeals) erred in holding that the assessee is eligible for deduction u/s.80IB(10) ignoring the findings given in the assessment order which was based on facts and which was also based on the report of the Govt. Approved Valuer. 3. In the appeal of the Revenue, the only issue raised is with regard to the action of the CIT(A) in allowing the deduction under section 80IB(10) of the Act, which had been disallowed by the Assessing Officer. 4. In brief, the relevant facts are that, assessee is a partnership firm engaged in the business of builders and promoters. For the assessment year 2009-10, it filed a return of income declaring total income of Rs. 1,71,390/-, which inter....
X X X X Extracts X X X X
X X X X Extracts X X X X
....(No.2) Act, 2004 w.e.f. 01.04.2005. In so far as the assessee's project was concerned, it was approved prior to 01.04.2005 and therefore, the expression 'built-up area' is not to be understood in terms of the definition in section 80IB(14)(a) of the Act and rather the same has to be understood having regard to the Development Control Rules of the local authority i.e. Pune Municipal Corporation. With regard to the inclusion of the common terrace, assessee pointed out that such area was not sold exclusively to any of the flat owners and therefore, the respective flat holders are not enjoying the exclusive use of such attached common terrace, and on this count also such area could not be included to calculate the 'built-up area' of the four flats in question. In sum and substance, the claim of the assessee was that the built-up area of the aforesaid four flats was liable to the considered by excluding the attached terrace projections or the attached common terrace; and, if it was so done, the built-up area was within the prescribed limit. The Assessing Officer rejected the plea of the assessee and observed that on account of four flats violating the condition prescribed in clause (c) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....T(A) erred in allowing assessee's claim for deduction without appreciating that the definition of 'built-up area' contained in section 80IB(14)(a) of the Act was to be applied to examine the claim of deduction under section 80IB(10) of the Act from assessment year 2005-06 onwards, irrespective of the date of approval of the project. 9. On the other hand, the learned Representative for assessee has relied upon the order of CIT(A) in support of the case of the assessee. It has also been submitted by the learned Representative for assessee that the decisions of Pune Bench of the Tribunal relied upon by the CIT(A) continue to hold the field and that even in the later decisions of the Tribunal, same position has been upheld. In this context, he relied upon decision of Pune Bench of the Tribunal in Shri Naresh T. Wadhwani Vs. DCIT, vide ITA Nos.18, 19 & 20/PN/2013 & Others, dated 28.10.2014. Reliance has also been placed on the judgment of the Hon'ble Madras High Court in the cases of CIT Vs. Sanghvi and Doshi Enterprises reported in (2013) 214 taxman 463 (Madras) and CIT Vs. Mahalakshmi Housing in Tax Case (Appeal) Nos.585 of 2011 and 318 of 2012, vide order dated 02.11.2012. Reliance ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....xpression 'built up area' for the purposes of clause (c ) to Sec.80IB(10) of the Act. Sec. 80 IB (14)(a) was inserted by the Finance (No.2) Act, 2004 w.e.f. 01.4.2005 prescribing the definition of the expression 'built up area'. In terms of the said definition, the built up area inter alia, includes the area of projections and balconies. The moot point is as to whether the such definition is applicable in respect of the project in question before us. Admittedly, it is emerging from the orders of the authorities below that the project DSK Frangipani commenced on 12.12.2003 i.e. prior to the 01.4.2005. Therefore, Revenue authorities are not justified in including the balconies/open terraces in the calculation of 'built-up area' and the definition of 'built-up area' in terms of Sec. 80IB(14)(a) of the Act cannot be applied to projects commenced prior to 1.4.2005. The aforesaid proposition is in line with the decision of the Mumbai Bench of the Tribunal in the case of Haware Constructions (Supra) as also the decision of the Pune Bench of the Tribunal in the case of Prime Properties (Supra). Now coming to the issue of inclusion of area of car parking, the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ment. It is also observed by the CIT(A) that the respective flat owners were not the owners of so called common terrace and the assessee also pointed out before him that even the Government Registered Valuer in his report nowhere stated that the common terrace area is exclusively used by the four flat owners referred above. Having regard to the aforesaid, in the absence of any controversion from the side of the Revenue, we find no reasons to approve the action of Assessing Officer in including the area styled as 'additional common terrace' as a part of the built-up area of the four residential units in question. The stand of the CIT(A) on this aspect is upheld. 14. At the time of hearing, the learned Representative for the assessee also relied upon the decision of Pune Bench of the Tribunal in the case of Shri Naresh T. Wadhwani Vs. DCIT (supra), wherein after following the decision of the Hon'ble Madras High Court in the case of M/s. Ceebros Hotels Private Limited Vs. DCIT, vide Tax Case (Appeal) No.581 of 2008 order dated 19.10.2012, it was held that even after taking into consideration the definition of 'built-up' area contained in section 80IB(14)(a) of the Act, the area cover....