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2020 (7) TMI 306
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....) A.Y 2012-13 CIT(Appeals)-32,Mumbai - Order dated 06/06/2016 Assessment order u/s 143(3), dated 31.03.2015. ITA 5523/Mum/2016 (Revenue) A.Y 2012-13 ITA 5913/Mum/2017 (Revenue) A.Y 2013-14 CIT(Appeals)-32,Mumbai - Order dated 20/06/2017. Assessment order u/s 143(3), dated 18.03.2016 As the issues involved in the abovementioned appeals are inextricably interlinked or in fact interwoven, therefore, the same are being taken up and disposed off together by way of a common order. We shall first advert to the cross-appeals for A.Y 2011-12. The impugned order has been assailed by the assesse on the following effective grounds of appeal before us: "1. The CIT(A) erred in upholding the reassessment proceedings initiated by the A.O under section 147 of the Act to be valid. 2. The CIT(A) failed to appreciate that jurisdictional pre-conditions necessary to be satisfied before assuming jurisdiction under sections 147 to 151 of the Act had not been fulfilled in the present case rendering the reassessment proceedings to be illegal and bad in law." On the other hand, the revenue has challenged the impugned order on the following grounds of appeal ....
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..... feet in size, when the provisions of section 80IB(10) of the Act allow deduction only upon completion of the entire project and not on part project or on part fulfilment of the requirements stated in the provisions of the section." 2. Briefly stated, the assessee firm which is engaged in the business of a property developer had filed its return of income for A.Y 2011-12 on 29.09.2011, declaring its total income at Rs. Nil. Return of income filed by the assessee was processed as such u/s 143(1) of the Act. Subsequently, the case of the assessee was selected for scrutiny assessment u/s 143(2) of the Act. In the course of the assessment proceedings, it was observed by the A.O that the assessee had in its return of income claimed deduction of Rs. 29,69,84,644/- u/s 80IB(10) of the Act in respect of a housing project "Adityavardhan" that was developed by it at 186-B, Saki Vihar Road, Andheri (East), Mumbai. On the basis of the material furnished in the course of the assessment proceedings the A.O found the claim for deduction raised by the assessee u/s 80IB(10) in order, and accepted the same while framing the assessment u/s 143(3), vide his order dated 28.03.2013. 3. Subsequent....
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....ening of the concluded assessment vide his letter No. JCIT/R.23(1)/Approval/151, dated 16.04.2015. In compliance to the notice issued u/s 148 of the Act, the assessee had requested that its 'Original' return of income filed on 06.12.2011 for A.Y 2011-12 may be treated as a return filed in compliance to the same. Accepting the said request of the assessee the A.O had proceeded with the assessment and issued notices u/ss. 143(2)/142(1) of the Act. On a perusal of the assessment order, we find that the A.O had vide his office letter dated 20.07.2015 provided to the assessee a copy of the 'reasons to believe' on the basis of which its case was reopened u/s 147 of the Act. As is discernible from a perusal of the 'reasons to believe' the case of the assessee was reopened by the A.O u/s 147 of the Act for two reasons viz. (i). that in the course of the assessment proceedings in the case of the assessee for A.Y 2012-13 "fresh information" was received from MCGM that Building Completion Certificate/Occupation Certificate had not been issued to the assessee, and accordingly, the building had not been completed till date; and (ii). that the "built-up area" of some of the residential units con....
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....er the plan as approved by MCGM in respect of the said project there were two D.P Roads running on the said plot which were to be constructed by the assessee and handed over to them. It is an undisputed position that the assessee has constructed as well as handed over the road running on East side of the plot to MCGM. However the Assessee could not construct the road on the South side of the plot of land as where the road was to be constructed there is a hill on which there is a pylon i.e., a transmission tower for transmission of electricity of Tata Electric Company. Since the South side road was not constructed, MCGM has not accepted the handing over of the same. Since the housing project was approved after 01.04.2005, as per section 80-IB(10)(a)(iii) of the Act the said project ought to have been completed within 5 years from the end of the financial year in which the said project was approved i.e on or before 31.03.2012. 2. 17.06.2010 The construction of the said project was completed by the assessee before this date, as its architect Mr. Bhupendra Patrawala issued a Certificate stating that the latest amended plans for residential building had been approved by Municip....
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....pleted during the year under consideration, assessee offered for tax income arising from the said project up to 31.03.2011 during the year. Total number of flats sold during upto 31.03.2011 were 54 and in respect of 44 flats the assessee had also granted possession to the purchasers. Upto 31.03.2012, the total number of flats sold stood at 92 of which possession has been granted by the assesee to the flat purchasers in respect of all the 92 flats. In respect of the flats sold by the assessee for which possession was also given to the flat purchasers, the electricity and the water bills have been met by the flat purchasers. They were also liable to share in the maintenance charges of the said building. Since the assessee had granted possession of almost 85% of flats to the flat purchasers before 31.03.2012, the presumption should be that the buildings were complete in all respects and were ready for occupation. 6. 29.09.2011 Assessee filed its return of income for A.Y 2011-12 declaring total income of Rs. Nil. Since it had fulfilled the conditions as prescribed under section 80-IB(10) of the Act it claimed deduction of Rs. 26,69,84,644/- under the said section. According....
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....re ready for occupation. Also, as claimed by the assessee, the architect had filed an application with MCGM for grant of "Occupation Certificate" in respect of the residential buildings in the said project. Alongwith the said application, the assessee's architect had filed certain certificates/documents evidencing that the construction of the building was complete viz. (i). certificate from the site supervisor to the effect that the construction of the residential building was complete in accordance with regulations 45 and 46 of the Development Control Regulations; and (ii). certificate from Structural Consultants Engineers & Architects therein certifying that structural work of the building was carried out as per his structural design which complied with the requirement of I.S. Code No. 1893 for earthquake design and requirements as mentioned in clause Nos. 45 and 46 of the Development Control Regulations. Apart from that, it was submitted by the assessee that total number of flats sold upto 31.03.2011 were 54 out of which possession of 44 flats had already been given to the purchasers. Further, it was stated by the assessee that by the end of the next year i.e upto 31.03.2012 it ....
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....which the project was supposed to be completed i.e 31.03.2012, therefore, the assessee was not eligible for claim of deduction u/s 80IB(10) of the Act. Accordingly, the A.O on the basis of his aforesaid deliberations concluded that the assessee had failed to comply with the mandate of Sec. 80IB(10)(a)(iii) of the Act. 8. As regards the observation of the A.O that as the built up area of all 3 BHK flats in the aforesaid project was more than 1000 sq. ft., therefore, the assessee had also violated the condition specified in Sec. 80IB(10)(c) of the Act, the same was rebutted by the assessee. It was submitted by the assessee that the area of the 3 BHK flats as per their calculation was 997 sq.ft. In order to fortify its aforesaid claim, the assessee had drawn support from the certificate of Shri. Bhupendra Patrawala, Architect, that was furnished in the course of the assessment proceedings. It was the claim of the assesee that while calculating the "built-up area" of the 3 BHK flats it had excluded the area of "dry balcony" as it was 6 inches below the floor level. On the basis of his aforesaid submissions, it was the claim of the assessee that as it had duly complied with the condi....
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...., the A.O vide his order passed u/s 143(3) r.w.s 147, dated 18.03.2016, assessed the income of the assessee company at Rs. 26,69,84,644/-. 10. Aggrieved, the assessee assailed the assessment order before the CIT(A). As regards the claim of the assessee that the A.O had exceeded his jurisdiction in reopening the case of the assessee for the year under consideration, the CIT(A) was not inclined to accept the same. Insofar the declining of the assessee's claim for deduction u/s 80IB(10) by the A.O, for the reason, that as the "Building Completion Certificate" and "Occupation Certificate" was not obtained by the assessee from MCGM, therefore, the project viz. "Adityavardhan" could not be held to have been completed within the stipulated time period as envisaged in Sec. 80IB(10)(a)(iii) i.e latest by 31.03.2012, the same did not find favour with the CIT(A). It was observed by the CIT(A) that the withholding of the aforesaid certificates by the local authority was because the assessee which as per the approved plan was mandated to construct and hand over a 18.3 mtr wide DP road on the South side of the plot had failed to comply with the said requirement. On a perusal of the facts born....
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....at the built-up area of each flat did not exceed 1000 sq. ft. In the backdrop of his aforesaid observations, the CIT(A) concluded that there was no violation of Sec. 80IB(10)(c) as was alleged by the A.O. 12. On the basis of his aforesaid deliberations, the CIT(A) after upholding the validity of the jurisdiction assumed by the A.O u/s 147 of the Act, however, on merits found favour with the claim of deduction raised by the assessee u/s 80IB(10) of the Act. 13. Both the assessee and the revenue being aggrieved with the order of the CIT(A) have carried the matter by way of cross-appeals before us. Insofar the assessee is concerned, it has assailed the order of the CIT(A), to the extent, he had upheld the validity of the jurisdiction assumed by the A.O u/s 147 of the Act. On the other hand, the revenue has challenged the order of the CIT(A) on the ground that he had erred both in law and the facts of the case in setting aside the well reasoned order of the A.O and allowing the assessee's claim for deduction u/s 80IB(10) of the Act. 14. We shall first advert to the contentions advanced by the ld. A.R in support of his claim that the A.O had traversed beyond the scope of his ju....
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....d had submitted that the said project was completed during the year under assessment. The ld. A.R also took us through the complete sold/unsold flat vise details that was furnished with the A.O in the course of the 'Original' assessment proceedings (Page 13 -23 of 'APB'). Also, our attention was drawn to the "Closing stock" of Wing A & B- flats, as were lying with the assessee as on 31.03.2011 (Page 26-29 of 'APB'). The ld. A.R further took us through a letter dated 16.03.2013 filed by the assessee in the course of the assessment proceedings, wherein in compliance to the details called for by the A.O in the course of the 'Original' assessment proceedings, the assessee had furnished its reply alongwith supporting documents viz. area of land alongwith supporting documents; copy of Commencement Certificate issued by MCGM; copy of the plan of the project approved by MCGM; copy of the application filed by the assessee's architect as regards the completion of the project etc (Page 30-31 of 'APB'). Further, the ld. A.R took us through a letter of Shri Bhupendra Patrawala, Architect, dated 17.06.2010, wherein it was certified by him that the latest amended plans for residential buildings c....
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....im of deduction u/s 80IB of the Act, could not have thereafter been disturbed by reopening its case on the basis of a mere 'change of opinion' of his successor. In order to buttress his aforesaid claim reliance was placed by the ld. A.R on the judgment of the Hon'ble High Court of Bombay in the case of GKN Sinter Metals Ltd. Vs. Ms. Ramapriya Raghavan, ACIT & Ors. (2015) 371 ITR 225 (Bom) and that of the Hon'ble Supreme Court in the case of CIT Vs. Kelvinator of India Ltd. (2010) 320 ITR 561 (SC). Relying on the said judicial pronouncements, it was submitted by the ld. A.R that an assessment cannot be reopened on a mere 'change of opinion'. It was further submitted by the ld. A.R that now when the assessee in course of verification of its claim for deduction u/s 80IB(10) of the Act, had furnished the requisite details/documents as were called for by the A.O during the 'Original' assessment proceedings, thereafter it was not obligated to inform the A.O of the probable inferences that may be raised on the basis of the facts disclosed. The said contention was advanced by the ld. A.R to support his claim that though the assessee in the course of the 'Original' assessment proceedings wa....
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.... the 'Original' assessment proceedings had specifically called upon the assessee vide his letter dated 22.02.2013 [Page 6-7 - Para 10(iv)] to place on record the "Completion Certificate" issued by the local authorities, however, the assessee instead of complying with the said requirement had furnished the "Building Completion Certificate" issued by its architect (Page 36 of 'APB'). It was further submitted by the ld. D.R that as in the present case the reopening was done within a period of four years from the end of the assessment year, therefore, the requirement of proving that there was no full and true disclosure on the part of the assessee was not to be shown. It was submitted by the ld. D.R that the only issue which was required to be examined for verifying the validity of the reopening of the concluded assessment of the assessee for the year under consideration was as to whether was there any "tangible material" with the A.O, on the basis of which he could validly arrive at a satisfaction that the income of the assessee chargeable to tax had escaped assessment. It was submitted by the ld. D.R that the 'Original' assessment in the case of the assessee for the year under consid....
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....ord, and also the judicial pronouncements relied upon by them in context of the aforesaid issue under consideration. Admittedly, the A.O while framing the 'Original' assessment, vide his order passed u/s 143(3), dated 28.03.2013, had raised exhaustive queries as regards the eligibility of the assessee towards claim of deduction u/s 80IB(10) of the Act. Being of the view, that the claim raised by the assessee for deduction u/s 80IB(10) was in order, the same was allowed by the A.O, as such. However, as observed by us hereinabove, it was only in the course of the assessment proceedings in the case of the assessee for A.Y 2012-13 that the A.O was informed by the MCGM vide its letter No. DyChE/BP/19415/ES, dated 19.03.2015, that the "Building Completion Certificate" and "Occupation Certificate" was not issued to the assessee on account of certain failure on the part of the latter as regards effecting compliance to the building I.O.D (Intimation of Disapproval) conditions. Accordingly, in the backdrop of the aforesaid information received subsequent to the culmination of the 'Original' assessment framed vide order passed u/s 143(3), dated 28.03.2013 for A.Y 2011-12, that the A.O had ....
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....aterial" to come to the conclusion that there is escapement of income from assessment. It was further observed by the Hon'ble Court that the reasons must have a live link with the formation of the 'belief'. Accordingly, in the backdrop of the aforesaid settled position of law, we shall deliberate upon the aspect as to whether the A.O on the basis of "tangible material" had came to a conclusion that the income of the assessee chargeable to tax had escaped assessment, and thus reopened its concluded assessment u/s 147 of the Act, or had done so on the basis of a mere "change of opinion". As is discernible from the facts borne from the records, the assessee in the course of the "Original" assessment proceedings had despite specific direction by the A.O failed to place on record the "Completion Certificate" of its project viz. "Adityavardhan", as issued by the local authorities. In fact, as observed by us hereinabove, the assessee had filed with the A.O a building completion certificate issued by its architect i.e Mr. Bhupendra Patrawala. It was only in the course of the assessment proceedings in the case of the assessee for the immediately succeeding year i.e A.Y 2012-13 that the A.O ....
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....aped assessment. As such, a reason to believe at the stage of reopening of a concluded assessment is all that is relevant. Our aforesaid view is fortified by the judgment of the Hon'ble Supreme Court in the case of CIT Vs. Rajesh Jhaveri Stock Brokers (P) Ltd. (2007) 291 ITR 500 (SC). We find that it is the claim of the ld. A.R that the A.O while framing the 'Original' assessment, vide his order passed u/s 143(3), dated 28.03.2013 for the year under consideration i.e A.Y 2011-12, had accepted the 'Building Completion Certificate' issued by the assessee's architect i.e Mr. Bhupendra Patrawala, alongwith other documents that were placed on his record by the assessee, for concluding, that the assessee had completed its project viz. "Adityavardhan" within the stipulated time period i.e latest by 31.03.2012. In the backdrop of his aforesaid claim, it was submitted by the ld. A.R that the subsequent reopening of its concluded assessment on the ground that the said project was not completed till date, for the reason, that MCGM had not issued "Completion Certificate"/"Occupation Certificate" would tantamount to reopening on the basis of a mere 'change of opinion' of the successor A.O, whic....
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....the said project. Be that as it may, it is an admitted fact that subsequent to the culmination of the regular assessment for the year under consideration, the A.O was in receipt of information from MCGM vide its letter No. DyChE/BP/19415/ES, dated 19.03.2015, that the "Building Completion Certificate" and "Occupation Certificate" was not issued to the assessee on account of certain failure on its part to comply with the building I.O.D (Intimation of Disapproval) conditions. We hold a strong conviction that the said "fresh information" received by the A.O from MCGM justified formation of a bonafide belief on his part that the income of the assessee chargeable to tax had escaped assessment. Apart from that, we find that in the course of the assessment proceedings for the immediately succeeding year i.e A.Y 2012-13, specific information was gathered by the A.O that some of the residential units constructed by the assessee in its housing project viz. "Adityavardhan" exceeded the maximum area allowable u/s 80IB(10)(c) of the Act. In our considered view, the said information gathered by the A.O on the basis of verifications carried out in the course of the assessment proceedings for A.Y ....
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....relevant assessment year had earlier been framed under sub-section (3) of Section 143 or Sec. 147, no action shall thereafter be taken after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax had escaped assessment for such assessment year by reason of the failure on the part of the assessee to make a return under section 139 or in response to a notice issued under subsection (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year. In our considered view, as the case of the assessee before us had been reopened within a period of four years from the end of the relevant assessment year, therefore, the aforesaid judicial pronouncement being distinguishable on facts would not assist its case. (ii). GKN Sinter Metals Ltd. Vs. Ms. Ramapriya Raghavan ACIT & Ors. (2015) 371 ITR 225 (Bom) : The ld. A.R had in the course of hearing of the appeal had relied on the aforesaid judgment of the Hon'ble High Court of Bombay. Facts in brief are that the assessee petitioner had three manufacturing units - one located at Pimpri and two at Ahmednagar. The two ....
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....ture in the units which were not eligible for Sec. 80-IA deduction, thereby inflating the profits of the units which were eligible for deduction. We find that it was in the backdrop of the aforesaid facts that the Hon'ble High Court had concluded that the A.O in the course of the regular assessment had called upon the assessee to furnish details as regards its claim for deduction u/ss. 80-IA/80-IB of the Act. It was further noticed by the Hon'ble High Court that the A.O on being satisfied with the assessee's reply, had vide his assessment order passed u/s 143(3), dated 09.03.2005 accepted its claim for deduction u/ss. 80-IA/80-IB of Rs. 2.08 crores. As such, it was in the backdrop of the aforesaid facts that the Hon'ble High Court had observed that the A.O while passing the assessment order u/s 143(3), dated 09.03.2005, had formed an opinion in respect of allocation of expenses amongst the three manufacturing units for deduction u/ss. 80-IA/80-IB of the Act. Further, the Hon'ble High Court had also declined to accept the claim of the revenue that the reopening was based on the communication dated January 15, 2007 that was received by the A.O from the Addl. CIT who had assessed the ....
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....rmity in the assumption of jurisdiction by the A.O u/s 147 of the Act, and are thus not inclined to subscribe to the claim of the ld. A.R that the concluded assessment in the case of the assessee had been reopened on a mere 'change of opinion'. As such, holding a conviction that the A.O had rightly assumed jurisdiction and reopened the case of the assessee u/s 147 of the Act, we uphold the same to the said extent. Grounds of appeal Nos. 1 & 2 are dismissed. 20. Resultantly, the appeal of the assessee is dismissed. ITA No. 5912/Mum/2017 A.Y 2011-12 (Revenue's appeal) 21. We shall now take up the appeal of the revenue for A.Y 2011-12. The Revenue has assailed the order of the CIT(A), to the extent he had set aside the order of the A.O and held the assessee's claim for deduction u/s 80IB as being in order. As elaborated at length by us hereinabove, the A.O vide his reassessment order passed u/s. 143(3) r.w.s 147 of the Act, dated 18.03.2016, had withdrawn the assessee's claim for deduction of Rs. 26,69,84,644/- u/s 80IB of the Act. The A.O had held the assessee to have failed to carry out a cumulative satisfaction of the requisite conditions contemplated in Sec. 80IB(10....
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.... was not eligible for claim of deduction u/s 80IB of the Act. The ld. D.R drawing our attention towards 'Explanation (ii)' to Sec. 80IB(10)(a), therein submitted, that as per the mandate of law the date of completion of construction of the housing project statutorily has to be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority. Further, it was submitted by the ld. D.R that as the built-up area of all 3 BHK residential units and flats in the assessee's housing project viz. "Adityavardhan" had exceeded the maximum allowable area of 1000 sq. feet, therefore, the assessee having violated the conditions of Sec. 80IB(10)(c) of the Act, was thus rightly held by the A.O to be ineligible for claim of deduction under the said statutory provision. In the backdrop of his aforesaid contentions, it was submitted by the ld. D.R that the CIT(A) was in error in setting aside the well reasoned order of the A.O in context of the issue under consideration and holding the assessee as eligible for claim of deduction u/s 80IB(10) of the Act. 23. Per contra, the ld. A.R supported the order of the CIT(A), to the extent he had held....
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....f Electrical Engineer, vide his orders dated 11.08.2010, 10.11.2010 and 22.12.2010.; (ii). no objection certificate dated 22.12.2010 issued by the Deputy Chief Fire Officer (ES) in the Miumbai Fire Brigade; (iii) certificate of Assistant Engineer Building Proposal, MCGM, dated 02.07.2010 that the drainage system in the project was complete; (iv). provision of water connection in the buildings w.e.f 23.12.2011; and (v). confirmation of the Assistant Commissioner L-Ward in MCGM, dated 15.11.2011 that the flats of the housing project were occupied. Ld. A.R further submitted that the fact that out of 108 flats in the housing project the assessee had sold and given possession of 92 flats by 31.03.2012, in itself proved to the hilt that the construction of the housing project was complete well within the stipulated time period. The ld. A.R also took us through the certificates of independent professionals viz. (i). certificate of its architect viz. Mr. Bhupendra Patrawala, stating that the onsite works of the project i.e "Adityavardhan" were completed as regards the residential buildings in all respects and the flats were ready for occupation; (ii).application filed by the architect with....
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....that minor deviation thereof would not vitiate the very purpose for which deduction was being made available. The ld. A.R also took support of the orders of the Hon'ble Supreme Court in the case of CIT Vs. Classic Binding Industries (2018) 407 ITR 429 (SC) and PCIT Vs. Aarham Softronics (2019) 261 Taxman 529 (SC). Also, reliance was placed by the ld. A.R on the orders of the coordinate benches of Tribunal in the case of (i). Puran Ratilal Mehta Vs. ACIT, Circle 23(3), Mumbai (2019) 175 ITD 190 (Mum); and (ii). Ashiana Amar Developers Vs. ITO (2016) 178 TTJ 474 (Kol). Further, rebutting the observation of the A.O that the built up area of all 3 BHK flats in the aforesaid project was more than 1000 sq. ft., it was submitted by the ld. A.R that the area of the 3 BHK flats as per their calculation was 997 sq.ft. In order to fortify his aforesaid claim, the ld. A.R had drawn our attention to the certificate of Shri. Bhupendra Patrawala, Architect, that was filed with the A.O in the course of the assessment proceedings. It was the claim of the ld. A.R that while calculating the "built-up area" of the 3 BHK flats it had excluded the "dry balcony area" as it was 6 inches below the floor....
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....ld not encompass within its fold strict literalism, as the same would therein result in ignoring an important aspect that is "apparent legislative intent". It was averred by the ld. A.R that the Hon'ble Apex Court had observed, that strict interpretation does not encompass such literalism which would lead to absurdity and go against the legislative intent. Accordingly, it was submitted by the ld. A.R that the rule of strict interpretation was to be utilised in a manner to decipher the legislative intent and thereafter provide an appropriate interpretation for the exemption provided under the provisions of the Act which would be neither too narrow nor too broad. It was further submitted by the ld. A.R that the Hon'ble Apex Court had observed that the doctrine of substantial compliance is a judicial invention, equitable in nature, designed to avoid hardships in cases where a party does all that can reasonably be expected of it, but failed or faulted in some minor or inconsequent aspects which cannot be described as the "essence" or the "substance" of the requirements. The ld. A.R drawing support from the aforesaid observations of the Hon'ble Apex Court, therein submitted, that now wh....
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....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 day of April, 2004 [but not later than the 31st day of March, 2005], within four years from the end of the financial year in which the housing project is approved by the local authority. [(iii) in a case where a housing project has been approved by the local authority on or after the 1st day of April, 2005, within five years from the end of the financial year in which the housing project is approved by the local authority.] Explanation.-For the purposes of this clause,- (i) in a case where the approval in respect of the housing project is obtained more than once, such housing project shall be deemed to have been approved on the date on which the building plan of such housing project is first approved by the local authority; (ii) the date of completion of construction of the housing project shall be ....
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....B(10)(a)(iii) of the Act, it was required to be completed on or before 31.03.2012 i.e within 5 years from the end of the financial year in which it was so approved. Further, as per the "Explanation (ii)" to Sec. 80IB(10)(a), the date of completion of construction of the housing project statutorily had to be taken to be the date on which the completion certificate in respect of such housing project was issued by the local authority. As is discernible from the records, the A.O while framing the assessment had observed that as the assessee in the course of the assessment proceedings for A.Y 2012-13 despite specific directions had failed to furnish evidence in respect of completion of the project by placing on record the "Building Completion Certificate" as well as the "Occupation Certificate" issued by the local authority, therefore, the A.O had called for the requisite information by issuing notice u/s 133(6) of the Act to MCGM. Information was received by the A.O from MCGM vide its letter No. DyChE/BP/19415/ES, dated 19.03.2015, which revealed that the "Building Completion Certificate" and "Occupation Certificate" was not issued to the assessee, till date, on account of certain fail....
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....e assessee had not agreed to shift to another location; and (ii). that de hors issuance of the BCC/OC by MCGM, now when the construction of the housing project of the assessee was completed in all respects within the stipulated time period, therefore, its claim of deduction u/s 80IB(10) of the Act was in order. We have deliberated at length on the aforesaid contentions of the ld. A.R and are unable to persuade ourselves to subscribe to his claim. On a bare perusal of Sec. 80IB(10)(a)(iii) of the Act, we find that the assessee was obligated to complete the construction of the housing project latest by 31.03.2012. As observed by us hereinabove, the legislature in all its wisdom, vide the Finance (No.2) Act, 2004, w.e.f 01.04.2005 had carried out an intentional, purposive and conscious insertion of an "Explanation" to Clause (a) of Sec. 80IB(10) of the Act. On a perusal of clause (ii) of the "Explanation", we find that it has been therein provided that the date of completion of construction of the housing project shall be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority. As such, an assessee w.e.f A.Y 2005-....
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....uction of the project within the prescribed time limit. The ld. A.R had also advanced a contention that now when the buildings viz. Wing A & B of the housing project had been completed, and out of 108 flats in the housing project the assessee had sold and given possession of 92 flats by 31.03.2012, therefore, it would be incorrect to conclude that the assessee had not completed the "housing project" within the stipulated time period. We are not at all impressed by the said claim of the ld. A.R. In our considered view, the assessee was obligated to complete the construction of the housing project as per the approved plan and comply with the I.O.D conditions, and by no means could be permitted to construe the completion of the construction of buildings as completion of the housing project. 28. We shall now advert to the claim of the ld. A.R that as the failure to construct and hand over 18.30 mt wide D.P Road passing through the south side of the plot to MCGM as per the I.O.D conditions was for reasons beyond its control, therefore, it could not have been justifiably be denied of its claim for deduction u/s 80IB(10) of the Act. We are unable to agree with the said claim of the ass....
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....he aforesaid facts that the Hon'ble High Court had observed that as the delay in issuance of the "Completion Certificate" could not be attributed to the assessee company, therefore, the assessee was entitled for exemption u/s 80IB(10) of the Act. (b). Unlike the facts of the aforesaid case, the facts involved in the case before us are totally distinguishable. As observed by us hereinabove, the "Completion Certificate" for the project viz. Adityavardhan, had till date not been issued to the assessee because it had admittedly failed to comply with the building I.O.D (Intimation of Disapproval) conditions, and had not completed the "housing project" as per the approved plan. On the basis of our aforesaid observations, we are of the considered view that as the aforesaid case is distinguishable on facts, therefore, the same would not assist the case of the assessee before us. (ii). CIT Vs. Tarnetar Corporation (2014) 362 ITR 174 (Guj) (a). In the aforesaid case, the fact that the assessee had completed the construction of the "housing project" within the stipulated time period i.e well before 31.03.2008, was not in doubt. In fact, the assessee had not only com....
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....n facts would not come to the rescue of the assessee. (iii). Ashiana Amar Developers Vs. ITO (2016) 178 TTJ 474 (Kol) (a) In the aforesaid case, the assessee had duly applied for the "Completion Certificate" from JDA i.e the local authority, immediately after the completion of the project. However, the local authority directed the assessee developer to take the completion certificate from a registered architect for official purposes. It was in the backdrop of the aforesaid facts, that the Tribunal had observed that insistence of the A.O on the certificate from the local authority would only result in impossibility of performance on the part of the assessee. Observing, that the "housing project" was completed within the allotted time frame and the possession certificate was also duly furnished before the A.O, the Tribunal concluded that the deduction u/s 80-IB(10) could not be denied on the ground of non-production of "completion Certificate" from the local authority. (b) As in the aforesaid case, the assessee had admittedly completed the "housing project" within the stipulated time period, therefore, the Tribunal had concluded that the assesse's ....
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.... It was submitted by the ld. A.R that as the assessee by completing the construction of the "housing project" within the prescribed time frame had substantially complied with the mandate of Sec. 80IB(10) of the Act, therefore, by taking recourse to a strict literal interpretation its entitlement towards claim of deduction under the said statutory provision could not be declined. In sum and substance, the ld. A.R advocated the principle of liberally construing a statutory provision in a case where the assessee is found to have substantially complied with the conditions therein envisaged. The ld. A.R by pressing into service the "Principles of Statutory Interpretation" by Justice G.P Singh, submitted, that the general rule that non-compliance of mandatory requirements results in nullification of the act is inter alia subject to an exception viz. where the performance of the requirement is impossible, then the performance of the same is to be excused. Accordingly, it was submitted by the ld. A.R that the failure on the part of the assessee to construct the 18.30 mt wide D.P Road passing through the south side of the plot, being an act which could not possibly be performed, would clear....
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....retation of the language used therein. 31. Apart from the aforesaid judicial pronouncements of the Hon'ble Apex Court, we shall now advert to the judgment of the "Constitutional bench" of the Hon'ble Supreme Court in the case of Commissioner Customs (Imports), Mumbai Vs. Dilip Kumar And Company And Others (2018) 9 SCC 1 relied upon by the ld. D.R. The ld. D.R by drawing support from the said judgment had claimed that in case of any ambiguity in understanding an exemption notification or an exemption clause the benefit of such ambiguity must be strictly interpreted in favour of revenue. On a perusal of the aforesaid judgment, we find that the Hon'ble Apex Court had deliberated on the aspect as to how a concession/exemption/incentive/rebate/subsidy notifications or provisions are to be construed. In its said judgment the Hon'ble Apex Court had observed that before taxing any person, it must be shown that he falls within the ambit of the charging section by clear words used in the section, and if the words of the charging section are ambiguous or open to two interpretations then the benefit of interpretation of such charging provisions has to be given to the assessee. In so far int....
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.... exemption notification, and in case of any ambiguity such notification has to be construed against the assessee. As observed by the Hon'ble Court, the need to resort to any interpretative process arises only where the meaning is not manifest on the plain words of the statute. If the words are plain and clear and directly convey the meaning, there is no need for any interpretation. Further, it was observed by the Hon'ble Court that if an exemption is available on complying with certain conditions, then the said conditions have to be complied with. As regards the aspect of "substantial compliance", we find that the Hon'ble Apex Court had observed that the doctrine of substantial compliance seeks to preserve the need to comply strictly with the conditions or requirements that are important to invoke a tax or duty exemption and to forgive non-compliance for either unimportant and tangential requirements or requirements that are so confusingly or incorrectly written that an earnest effort at compliance should be accepted. It was further observed, that an exemption from taxation is to be allowed based wholly by the language of the notification and exemption cannot be gathered by necessa....
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....ed that the doctrine of substantial compliance seeks to preserve the need to comply strictly with the conditions or requirements that are important to invoke a tax or duty exemption and to forgive non-compliance for either unimportant and tangential requirements or requirements that are so confusingly or incorrectly written that an earnest effort at compliance should be accepted. Now, in the case of the assessee before us, we are unable to comprehend that as to on what basis the failure of the assessee to complete the construction of its housing project viz. "Adityavardhan" within the prescribed time limit could be brought within the meaning of an unimportant or tangential requirement, as had been canvassed by the ld. A.R before us. In fact, we are of a strong conviction that completion of the construction of a "housing project" by an assessee developer, as per the approved plan, within the prescribed time frame forms the very basis for the eligibility of an assessee to claim deduction u/s 80IB(10) of the Act. On the basis of our aforesaid observations, we are of the considered view that the assessee had failed to strictly comply with the conditions or requirements that were import....
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.... that the importance of the "Explanation (ii)" to Sec. 80IB(10) cannot be undermined for the purpose of construing the scope and gamut of the said statutory provision. Our said conviction is fortified by the judgment of the Hon'ble Apex Court in the case of Dilip Kumar (supra), wherein it was observed that an "Explanation" to a statutory provision is inter alia an internal aid for construing the same. In the backdrop of our aforesaid observations, we are of the considered view that the assessee had failed to show as to how its case comes squarely within the realm of the deduction contemplated u/s 80IB(10) of the Act. Accordingly, in our considered view, the A.O had rightly concluded that de hors satisfaction of the conditions contemplated in Sec. 80IB(10) of the Act, the assessee was not entitled for claim of deduction under the said statutory provision. We thus not finding favour with the order of the CIT(A), to the extent he had concluded that the assessee had satisfied the conditions contemplated in Sec. 80IB(10) of the Act, 'set aside' his order. The Grounds of appeal No. 1 & 4 raised by the revenue are allowed. 33. We shall now take up the grievance of the revenue that the ....
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....alia acting upon the information that the built-up area of all 3BHK flats in the project viz. "Adityavardhan" was more than 1000 sq. ft, which was in clear violation of the norms prescribed in Sec. 80IB(10)(c) of the Act, inter alia for the said reason reopened the concluded assessment. On being called upon to explain its eligibility for deduction u/s 80IB(10)(c) in the backdrop of the fact that the built-up area of all 3 BHK flats in its project was more than 1000 sq. ft., the assessee rebutted the said allegation of the A.O. It was submitted by the assessee that the area of the 3 BHK flats as per their calculation was 997 sq.ft. In order to fortify its aforesaid claim, the assessee had drawn support from the certificate of Shri. Bhupendra Patrawala, Architect, that was furnished in the course of the assessment proceedings. It was submitted by the assessee that while calculating the "builtup area" of the 3 BHK flats it had excluded the "dry balcony area" as it was 6 inches below the floor level. On the basis of its aforesaid submissions, it was the claim of the assessee that it had duly complied with the conditions contemplated in Sec. 80IB(10)(c) of the Act. However, the A.O w....
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....he assessee's architect had also certified that the built-up area of each flat did not exceed 1000 sq. ft. In the backdrop of his aforesaid observations the CIT(A) concluded that there was no violation of Sec. 80IB(10)(c) by the assessee, as was alleged by the A.O. 35. We have heard the authorised representatives for both the parties, perused the orders of the lower authorities and the material available on record, as well as the judicial pronouncements relied upon by them. On a perusal of the records, we find that the controversy involved in context of the issue under consideration hinges around the construing of the term "built-up area" used in Sec. 80IB(10)(c) of the Act. We find that the definition of the term "built-up area" has been made available on the statute vide the Finance (No.2) Act, 2004, w.e.f 01.04.2005, and the said term thereafter stands defined in Sec. 80IB(14)(a) of the Act, as under: "80IB(14) For the purposes of this section,- (a) "built-up area" means the inner measurements of the residential unit at the floor level, including the projections and balconies, as increased by the thickness of the walls but does not include the common areas s....
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....ovided by the assessee had been sold to the flat purchasers; (iii). that as the 'projections' and 'balconies' are not in the nature of a common area shared with other residential units, therefore, the same would fall within the realm of the definition of "built-up area" as contemplated in Sec. 80IB(14)(a); (iv). that even otherwise the qualifier 'at the floor level' in Sec. 80IB(14)(a) was applicable to the "Inner measurements of the residential unit" and not to the 'projections' and 'balconies' which followed the term 'including the'; and (v). that even otherwise as per the Development Control Rules (DC Rules) of 2012 (for short "DCR"), the Government of Maharashtra has announced that under the new DCR, areas for balcony, flower-beds, terrace, voids, niches would be counted in the FSI. Hence, even as per the rules of the local authority, the area for balcony is to be added for computation of the 'built-up area'. 37. As observed by us hereinabove, the CIT(A) accepted the claim of the assessee that the area of neither of the flats exceeded the prescribed limit of 1000 sq. ft. It was observed by the CIT(A) that as claimed by the assessee, as per the definition of "built-up area" i....
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....ust be part of the inner measurements of a residential unit or projection or balcony. In our considered view, the claim of the assessee that as the "dry balcony" was 6 inches below the floor level, therefore, the same for the said reason would not fall within the realm of the definition of "built-up area" is absolutely misconceived. As observed by us hereinabove, the inner measurements of a residential unit or projection or balcony would inter alia form part of the "built-up area". Our aforesaid view is supported by the judgment of the Hon'ble High Court of Gujarat in the case of CIT Vs. Amaltas Accociates (2016) 389 ITR 175 (Guj). Also, support is drawn from the order of the ITAT, Mumbai in the case of ITO Vs. Siddhivinayak Homes, ITA No. 8726/Mum/2010 - A.Y 2007-08 & ITA No. 5986/Mum/2011-A.Y 2008-09 AND ITAT, Hyderabad in the case of Modi Builders & Realtors (P) Ltd., (2011) 12 taxmann.com 129 (Hyd), as had been relied upon by the A.O. In so far the observation of the CIT(A) that the "dry balcony" has not been sold by the assessee to the flat purchaser, the said fact as per records remains so. But then, we are unable to comprehend that de hors transfer of ownership of the same, ....
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.... of the walls, but did not include the common areas shared with other residential units. In our considered view, if the assessee in the case before us had de facto provided the exclusive possession/enjoyment of the "dry balcony" attached with a flat to the purchaser of the said flat (as advertised by it in its brochures), then the same will have to be included while computing the "built-up area" of such flat, failing which the very purpose of the definition of the said term in Sec. 80IB(14)(a) would be rendered as otiose. But then, in the absence of the correct factual position the aforesaid issue before us cannot be adjudicated. We thus in all fairness restore the issue to the file of the A.O for fresh adjudication. In case, the flat purchaser is de facto in exclusive possession/enjoyment of the "dry balcony" attached with the flat, then the area of the same shall be included while computing the "built-up area" of such flat. However, if such projection is either in the nature of a service projection to be used for servicing the building or carrying out repairs of the building, or a common area shared with the other residential units, then the same would not be included in the "bui....
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....s Private Limited Vs. ACIT (2013) 214 Taxman 524 (Mad) and CIT Vs. Elegant Estates (2016) 383 ITR 49 (Mad). Also, a similar view had been taken by various coordinate benches of the Tribunal in viz.(i). DCIT vs. Brigade Enterprises Pvt. Ltd.,(20Q8) 119 TT J (Bang) 269; (ii). AIR Developers.,(2010) 122 ITD 125 (Nag); (iii). Sheh Developers Pvt. Ltd. 33 SOT 277 (Bom); (iv). Runwal Multihousing Pvt. Ltd. Vs ACIT, ITA Nos. 1015, 1016 & 1017/PN/2011; (v) Brahma Associates Vs JCIT, 119 ITD 255 (Bom); (vi). Kumar Builders Consortium Vs ACIT, 7 Taxcorp (AT) 32844 (Pune); (vii). Tushar Developers Vs ITO, 6 Taxcorp (AT) 30190 (Pune); (viii). Kumrar Beharey Rathi & Raviraj Kothari Punjabi Associates Vs DCIT, 22 DTR 1 (Pune); (ix). Jindal Mittal Griha (2017) 51 CCH 240 (Pune); Nirman Pvt. Ltd. Vs. ITO and (x). Varun Developers Vs DCIT, 7 Taxcorp (AT) 1978 (Pune). Before parting, we may herein observe that our findings recorded in context of the issue under consideration, are without prejudice to our observations recorded as regards the eligibility of the assessee towards deduction u/s 80IB(10)(a), as dealt with at length hereinabove.The Ground of appeal No. 5 raised by the revenue is dismiss....
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....tually represented a service projection constructed from the point of view of servicing the building. The said area was 6" to 7 ½" below the floor level. Further, the said area was not a subject matter of sale and was not expected to be occupied by the flat owner and therefore could not be regarded as a part of the built-up area of the residential unit." On the other hand, the revenue has challenged the impugned order on the following grounds of appeal before us : "1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in allowing deduction under section 80IB(10) of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') to the assessee on a high gross profit of 61.99% when the assessee had not fulfilled all the conditions laid down in the provisions of the Act. 2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in allowing deduction under section 80IB(10) of the Act to the assessee inspite of the fact that the assessee did not complete its project within the time as stipulated in the provisions of section 80IB(10)(a)(iii) of the Act. 3. On the facts and in the circumstanc....
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.... on part project or on part fulfilment of the requirements stated in the provisions of the section. 7. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in allowing proportionate deduction under section 80IB(10) of the Act to the assessee on those flats which were less than 1000 sq. ft in size and disallowed the deduction in respect of flats which were more than 1000 sq. ft. In size, when provisions of section 80IB(1) of the Act allow deduction only upon completion of the entire project and not on part project or on part fulfilment of the requirements stated in the provisions of the section. 8. The appellant prays that the order of the Ld. CIT(A) on the above grounds be set aside and that of the A.O be restored. 9. The appellant craves leave to amend or alter any ground or add a new ground." 43. Briefly stated, the assessee firm had e-filed its return of income for A.Y 2012-13 on 29.09.2012, declaring its total income at Rs. Nil. Subsequently, the case of the assessee was selected for scrutiny assessment u/s 143(2) of the Act. In the course of the assessment proceedings, it was observed by the A.O that the assessee had ....
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....r deliberating at length on the facts attending to the issue under consideration, it was observed by the CIT(A) that as it was impossible on the part of the assessee to remove the hill for constructing the road, therefore, for the said reason it had failed to comply with the said condition in the IOD/CC. In the backdrop of the aforesaid facts, the CIT(A) was of the view that the assessee should not have been denied deduction under Sec. 80IB(10) for not performing of an act which was impossible of performance, and that the Building Completion Certificate/Occupation Certificate could not be obtained for reasons beyond its control. The CIT(A) further drawing support from the judgment of the Hon'ble High Court of Bombay in the case of CIT Vs. Hindustan Samuh Awas Ltd. (2015) 62 taxmann.com 175 (Bom), therein observed that the facts borne from the records viz. purchasers of the flats had taken possession and were residing in the said flats; approvals were obtained by the assessee from the Fire Brigade authority, Lift Inspector, Asst. Engineer MCGM for drainage works etc., evidenced that the assessee had completed the physical construction of the project. Accordingly, the CIT(A) holding ....
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....rom the sale were recognized, which were furnished by the assessee as under: Assessment Year B/U Area Sold During the Year (Sq/ft) B/U Area in respect of Flat No. 1, 2 & 7 (Sq. ft) (Sq/ft) (A) - (B) Sq/ft 2011-12 49347.88 13956.28 35391.60 2012-13 33782.71 7969.56 25,813.15 2013-14 10277.36 4985.13 5292.23 2014-14 5642.06 2995.73 2646.33 Total 99050.01 29906.70 69143.31 On the basis of the aforesaid facts and figures provided by the assessee, the CIT(A) observed that the "built-up area" of 7969.56 of flats Nos. 1,2 & 7 was ineligible for deduction u/s 80IB of the Act. Accordingly, the CIT(A) disallowed the assessee's pro-rata claim for deduction of Rs. 4,52,95,102/- u/s 80IB on the said residential units. 48. Both the assessee and the revenue being aggrieved with the order of the CIT(A) has carried the matter in appeal before us. We shall first deal with the grievance of the assessee. The assessee has assailed the order of the CIT(A), for the reason, that he had erred in disallowing the assesses claim for deduction of Rs. 4,52,95,102/- u/s 80IB(10) in respect of flat nos. 1,2 and 7 on each floor of the bu....
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....d for servicing the building or carrying out repairs of the building, or a common area shared with the other residential units, then the same would not be included in the "built-up area" of the flat. The Grounds of appeal No. 1 to 3 are allowed for statistical purposes. 49. Resultantly, the appeal of the assessee is allowed for statistical purposes in terms of our aforesaid observations. ITA No. 5523/Mum/2016 A.Y 2011-12 (Revenue's appeal) 50. We shall now take up the appeal of the revenue. On a perusal of the grounds of appeal, we find that the revenue has assailed the order of the CIT(A) on three grounds viz. (i). that the CIT(A) had erred in allowing assessee's claim of deduction u/s 80IB(10), despite the fact that it had failed to complete the project within the prescribed time contemplated in Sec. 80IB(10)(a)(ii) of the Act; (ii). that the CIT(A) had erred in allowing pro rata deduction u/s 80IB(10), failing to appreciate that the provisions of Sec. 80IB(10) allowed deduction only upon completion of the entire project and not on part project or on part fulfilment of the requirements stated in the provisions of the section; and (iii). that the CIT(A) had erred in....
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....ns of Sec. 80IB(10)(a)(iii) and also Sec. 80IB(10)(c), in the case of Ekta Sankalp Developers(supra) the only non-compliance was as regards the provisions of Sec. 80IB(10)(c) of the Act. In so far the CIT(A) is concerned, as observed by us hereinabove, he had while disposing off the appeal held that the assessee had completed the construction of the housing project within the time limit contemplated in Sec. 80IB(10)(a)(iii)of the Act. Accordingly, the said distinguishing factor brought to our notice cannot be acceped. At the same time, we may herein clarify that though we have principally upheld the entitlement of the assessee towards pro rata claim of deduction u/s 80IB(10), i.e as regards the residential units whose "built-up area" is found to be within the prescribed limit of 1000 sq. feet, but then, as we have held that the assessee had failed to complete the construction of the housing project within the meaning of Sec. 80IB(10)(a)(iii), therefore, its claim for deduction u/s 80IB would fail on the said count itself. The Ground of appeal No. 5 is disposed off in terms of our aforesaid observations. 54. We shall now advert to the grievance of the revenue that the CIT(A) h....
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....sent case are totally different from the facts of the case in the above decision. In Hindustan Samuh Awas Ltd. (supra), the Hon'ble High Cout held that since the assessee had complied with all the norms of Intimation of disapproval (IOD) and had applied for completion certificate well in time before the Municipal Authority, therefore, the delay in issuing project completion certificate cannot be attributable to the assessee, whereas in the present case, the Municipal Corporation of Greater Mumbai (MCGM) had not issued completion certificate to the assessee as the assessee had not fulfilled in all the norms of IOD at the time of applying for completion certificate. Thus, the assessee is wholly and exclusively responsible for this delay. Hence, the case law relied upon by the Ld. CIT(A) is not applicable in this case. 5. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in allowing deduction u/s 80IB(10) of the IT Act, 1961 to the assessee on those flats which were less than 1000 sq. feet in size, when the provisions of section 80IB(10) of the Act allow deduction only upon completion of the entire project and not on part project or on....
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....th the said requirement. On a perusal of the facts borne from the records, it was observed by the CIT(A) that the construction of the aforesaid road was being obstructed by a power pylon transmission line belonging to Tata Electric Company, which had to be relocated before the road could be constructed. It was further observed by the CIT(A) that despite persuasion by the assessee the aforesaid power company had refused to relocate or shift the power pylon. After deliberating at length on the facts attending to the issue under consideration, it was observed by the CIT(A) that as it was impossible on the part of the assessee to remove the hill for constructing the road, therefore, for the said reason it had failed to comply with the said condition in the IOD/CC. In the backdrop of the aforesaid facts, the CIT(A) was of the view that the assessee should not have been denied deduction under Sec. 80IB(10) for not performing of an act which was impossible of performance, and that the Building Completion Certificate/Occupation Certificate could not be obtained for reasons beyond its control. The CIT(A) further drawing support from the judgment of the Hon'ble High Court of Bombay in the ca....
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....venue for A.Y 2012-13, ITA No. 5523/Mum/2016. Accordingly, the Grounds of appeal Nos. 1 and 4 raised by the revenue are allowed in terms of our aforesaid observations. 63. We shall now take up the claim of the revenue that the CIT(A) had erred in allowing deduction u/s 80IB(10) to the assessee despite the fact that the assessee did not fulfil the conditions laid down under Sec. 80IB(10)(c) of the Act, as some of the area of some of the residential units was more than the prescribed limit. The genesis of the controversy involved pertains to the construing of the term "built-up area" by the CIT(A), who as per the ld. D.R had erred in accepting the claim of the assessee that the area of the "dry balcony" is not to be included for the purpose of calculating the "built-up area" of the flats within the meaning of Sec. 80IB(14)(a) of the Act. We find that the construing of the term "built-up area" as envisaged in Sec. 80IB(14)(a) by the CIT(A), had been assailed by the revenue in its appeal in the assessee's own case for the preceding year i.e A.Y 2011-12 in ITA No. 5912/Mum/2017. As in year under consideration, in A.Y 2011-12 also the CIT(A) had found favour with the claim of the asse....
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....me terms dismissed. 65. Before parting, we may herein deal with a procedural issue that though the hearing of the captioned appeal was concluded on 19.02.2020, however, this order is being pronounced much after the expiry of 90 days from the date of conclusion of hearing. We find that Rule 34(5) of the Income-tax Appellate Tribunal Rules, 1962, which envisages the procedure for pronouncement of orders, provides as follows: (5) The pronouncement may be in any of the following manners :- (a) The Bench may pronounce the order immediately upon the conclusion of the hearing. (b) In case where the order is not pronounced immediately on the conclusion of the hearing, the Bench shall give a date for pronouncement. In a case where no date of pronouncement is given by the Bench, every endeavour shall be made by the Bench to pronounce the order within 60 days from the date on which the hearing of the case was concluded but, where it is not practicable so to do on the ground of exceptional and extraordinary circumstances of the case, the Bench shall fix a future day for pronouncement of the order, and such date shall not ordinarily be a day beyond a further period of 30 days and due notice ....
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....t, it has been such an unprecedented situation, causing disruption in the functioning of judicial machinery, that Hon'ble Supreme Court of India, in an unprecedented order in the history of India and vide order dated 6.5.2020 read with order dated 23.3.2020, extended the limitation to exclude not only this lockdown period but also a few more days prior to, and after, the lockdown by observing that "In case the limitation expired after 15.03.2020 then the period from 15.03.2020 till the date on which the lockdown is lifted in the jurisdictional area where the dispute lies or where the cause of action arises shall be extended for a period of 15 days after the lifting of lockdown". Hon'ble Bombay High Court, in an order dated 15th April 2020, has, besides extending the validity of all interim orders, has also observed that, "It is also clarified that while calculating time for disposal of matters made time-bound by this Court, the period for which the order dated 26th March 2020 continues to operate shall be added and time shall stand extended accordingly", and also observed that "arrangement continued by an order dated 26th March 2020 till 30th April 2020 shall continue furt....