TaxTMI 
TaxTMI 
2017 (3) TMI 483
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....dition of Rs. 2,46,34,603/- made by AO by disallowing deduction u/s 80IB of the Income Tax Act, 1961. The ld. CIT (A) has not appreciated the specific and express provisions of Explanation (ii) to clause (a) as well as clause (f) of section 80IB(10). (ii) Deleting the addition of Rs. 2,50,000/- made by AO by disallowing expenses u/s 40(a)(ia) of the Act. The ld. CIT (A) has not appreciated the fact that the assessee had failed to furnish certificate in prescribed from the payee as stipulated in Section 201 of the Act as well as the fact that the assessee failed to deduct any tax at source u/s 194J. (iii) Deleting the addition of R. 33,908/- made by AO by disallowing Interest Expenses u/s 40(a)(ia) of the Income Tax Act, 1961. The ld. CIT (A) has not appreciated the fact that there is not question of payment of TDS when the assessee failed to deduct any tax at source. (iv) The appellant craves liberty to raise additional ground and to modify/amend the ground of appeal at the time of hearing. 2. Briefly stated the facts of the case are that the case of the assessee was picked up for scrutiny assessment and the assessment under section 143(43) of the Income Tax Act, 1961 (hereinaf....
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....de and the UIT Kota gave a completion certificate with regard to 11 blocks only, thereby two blocks, namely, A5 and A6 were not approved, and the authority had inter alia laid down specific conditions that (1) installation of solar power and (2) approval of map for the construction of community hall, which was the condition to issue completion certificate for the above mentioned two blocks. After complying with the above two conditions, the assessee made a fresh application to UIT Kota dated 21.06.2011 for issue of completion certificate, followed by two reminders dated 18.07.2011 and 14.11.2011. But none of the above was responded by the concerned authority. The ld. Counsel submitted that the UIT Kota follows the rules and regulations of JDA Jaipur. As per provisions of sub-section (iii) of section 16 of JDA Rules, it is mandatory that after giving intimation of construction work being completed by the builder, completion certificate is to be issued within 30 days from the receipt of such intimation, and in case it is not provided by the competent authority, the applicant is to issue 15 days notice to the competent authority and if completion certificate is not issued by the compe....
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....too has to be construed so as to advance the objective of the provisions and not to frustrate the same. The ld. Counsel has relied upon the decision rendered in the case of Kura Homes P. Ltd. vs. ITO, 139 ITD 445. Further reliance is placed on the judgment of Hon'ble Gujarat High Court rendered in the case of CIT vs. Tarnetar Corporation, 362 ITR 174 (Guj.) in support of the condition that if substantial compliance of the conditions as required u/s 80IB(10) is established on record, in a given case, the court may take the view that minor deviation thereof would not vitiate the very purpose for which deduction was being made available. The ld. Counsel submitted that in the present case admittedly the project was duly completed within the prescribed time. Merely because the completion certificate was not furnished by the concerned local authority despite application would not dis-entitle the assessee from claiming deduction u/s 80IB(10). The ld. Counsel placed reliance on the decision of the Coordinate Bench rendered in the case of Gera Developments Pvt. Ltd. vs. JCIT Pune in ITA No. 598/PN/2013. Reliance is also placed on the decision of Coordinate Bench in the case of D.K. Construc....
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.... Act (No.2) 2009 w.e.f 01-04-2010, therefore would not be applicable in the case of the assessee. 3.4. Under these facts, we need to examine whether Ld. CIT(A) is justified in allowing the claim of deduction u/s 80 IB (10) of the Act. For availing the benefit of deduction u/s 80IB(10), the assessee has to demonstrate that all the conditions embodied into that section are fulfilled. For the sake of clarity, section 80IB(10) is reproduced as under:- " 80IB(10): The amount of deduction in the case of an undertaking developing and building housing projects approved before the 31st day of March, by a local authority shall be hundred per cent of the profits derived in the previous year relevant to any assessment year from such housing project if,- (a) Such undertaking has commenced or commences development and construction of the housing project on or after the 1st day of October, 1998 and completes such construction,- (i) in a case where a housing project has been approved by the local authority before the 1st day of April, 2004, on or before the 31st day of March, 2008; (ii) in a case where a housing project has been, or, is approved by the local authority on or after the 1st....
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....n which such individual is the karta, (iii) any person representing such individual, the spouse or the minor children of such individual or the Hindu undivided family in which such individual is the karta. Explanation- For the removal of doubts, it is hereby declared that nothing contained in this sub-section shall apply to any undertaking which executes the housing project as a works contract awarded by any person (including the Central or State Government)." 3.5. Now we need to apply the above conditions on the facts of the present case. There is no dispute with regard to approval, development and building housing project. As per the AO, the assessee was required to furnish Completion Certificate of Project for claiming the deduction. The ld. CIT (A) has given finding that the assessee has furnished Completion Certificate in respect of 11 blocks out of 13 blocks i.e. except block A-5 & A-6. This fact is not controverted by the revenue. In respect of remaining two blocks, the assessee had applied to the concerned authority and sent various reminders. It is observed by the ld.CIT (A) that as per the regulations governing the issuance of Completion Certificate, in case the as....
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....ncial year. The ld. CIT (A) has further contended that in the above case since the SLP filed by the department was dismissed by the Hon'ble Supreme Court. The ld. Counsel further submitted that the ratio established in the case of Vector Shipping has been recently followed by the Hon'ble ITAT Jaipur Bench in the case ofGirdhari Lal Bargoti, ITA No. 757/JP/2012 and the decision of the ITAT Jaipur Bench (supra) has been followed again in the case of M/s. Choudhary Yatra Company (P) Ltd. vs. ACIT in ITA No. 177/JP/2016 dated 05.09.2016. Based on above, it is submitted that the ratio of the above cases fully apply to the present case and the consultancy charges paid to Mahak Mehta and interest paid to Tata Motor Finance, since the same were duly paid before the end of the relevant financial year. Hence provisions of section 40(a)(ia) are not applicable to the above amounts, and thus disallowances made thereunder deserves to be deleted, and are rightly held so, by the ld. CIT (A), and thus prays that the same may kindly be accepted. The ld. Counsel further submitted that in the case of Mahak Mehta, it is not a case of non-deduction of tax, as tax has been deducted from the payment mad....
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.... held as under :- Second proviso - Assessment year 2006-07 - Whether insertion of second proviso to section40(a)(ia) with effect from 01.04.2013 is declaratory and curative in nature and it has retrospective effect from 01.04.2005, being date from which sub-clause (ia) of section 40(a) was inserted by Finance (No. 2) Act, 2004 - Held, yes." Thus, the proviso inserted in section 40(a)(ia) w.e.f. 01.04.2012 is curative and remedial in nature as it goes with the spiritofthe Government that no double tax should be charged on same income and hence the same is applicable retrospectively w.e.f. Asstt. Year 2005-06 when the sub section (ia) was inserted in section 40(a) of the Income tax Act, 1961. Such view has been upheld by the Hon'ble Supreme Court also. Therefore, the said proviso may kindly be taken to be applicable for the year under consideration also and the disallowance so made may kindly be deleted, as one can safely presume that the condition stipulated in the section namely (i) has furnished his return of income under section139; (ii) has taken into account such sum for computing income in such return of income; and (iii) has paid the tax due on the income declared by him in....