TaxTMI 
TaxTMI 
2015 (6) TMI 358
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.... facts are, assessee is a firm deriving income from construction of residential flats. Assessee filed return of income for A.Ys 2010-11 on 15.10.2010 declaring total income of Rs. 16,30,020 and for A.Y 2011-12 on 30.09.211 determining total income at Rs. 15,23,350. AO completed the assessment on 28.03.2013 for A.Y 2010-11 and on 18.02.2014 for A.Y 2011-12 u/s 143(3) determining total income at Rs. 2,17,15,740 and Rs. 85,62,700 respectively. 3. The ld CIT (A) allowed the appeal of the assessee on further appeal and held as under: "11. The first issue is with regard to rejection of claim u/s 80IB(10) of the I.T. Act by the assessing officer. Detailed submissions made and evidences available clearly indicate that the housing project was ....
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....anding with the customers i.e. flat owners the appellant incurred further expenditure in respect of thes said project. The appellant filed a detailed explanation, the same is reproduced as under: ".............. It can be seen from the profit and loss a/c that expenditure relating to finishing works is incurred during the financial year 2009-10 relevant to the A.Y 2010-11 mainly expenditure relating to law, club house, swimming pool, gym and some expenditure relating to changes requested by flat owners. The AO has not pin pointed that the expenditure is relating to construction cost and not for the above works carried on by the assessee. The profit admitted is 30% for the sales of Rs. 6,42,65,250 which is Rs. 1,92,79,575 when we dedujct ....
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....he assessee sold away the flats fallen to his share except 27 by 31.03.2008 itself. Whatever expenditure was incurred and debited to profit and loss account subsequent to 31.03.2008 was incurred for the purpose of promised common facilities tagged on to the housing project. In view of the above, as the assessee complied with all the requirements as laid down u/s 80IB of the IT Act the deduction claimed may be allowed". 4. Aggrieved, the Revenue has filed appeal before us raising the following grounds: "1. The order of the CIT (A) is erroneous in law as well as the facts of the case. 2. Whether the CIT (A) is correct in holding that the assessee is eligible for deduction u/s 80IB(10) despite the fact that project was not completed b....
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....after 01-04-2004, the construction should be completed within 4 years from the end of the financial year in which the housing project is approved by the Local Authority. ii) The housing project is constructed on a plot of land which has a minimum area of 1 acre. iii) The residential units constructed in the housing project have a maximum built up area of 1500 sq. ft. where such units are situated in places other than Delhi or Mumbai. iv) The built-up area of shops and other commercial establishments included in the housing projects does not exceed 5% of the aggregate built-up area of the housing project or 2000 sq. ft., whichever is less." 18. In the present case, the building plan approval was obtained on 10.3.2004 and there is....
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....ht in under Finance (No. 2) Act of 2004, effective from 1.4.2005. Thus, in the absence of any such requirement read into the section, we find it difficult to accept the observation of the AO that the claim for deduction was rejected on the ground that the assessee had not furnished the completion certificate. Being so, in the absence of any requirement u/s. 80IB(10)(a) of the Act and going by the provisions as applicable to the relevant assessment year, it is difficult to accept the contention of the Department that the claim of deduction has to be allowed to the assessee only on production of completion certificate. 21. Further, our view is supported by judgment of Madras High Court in the case of CIT vs. Jain Housing & Construction Ltd....
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.... As far as the projects at Manapakkam and Pallavaram are concerned, if the assessee had submitted certificates from sewerage and Electricity Board, which according to the Commissioner would not satisfy the requirement of the Rules, as already pointed out, in the absence of any requirement under Section 80IB(10)(a) of the Income Tax Act and going by the provision, as it stood during relevant assessment year, 2004-05, it is difficult to accept the contention of the Revenue that the claim for deduction rested on the assessee's production of completion certificates." 22. In view of the above discussion, there is no infirmity in the order of the CIT(A) and the same is to be confirmed. 23. Further there is a controversy regarding issue ....