TaxTMI 
TaxTMI 
2016 (12) TMI 1888
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....ection 263 of the Act. Notably, in the assessment order dated 13/1/2014(supra), the Assessing Officer has allowed a deduction of Rs.13,23,43,671/- under section 80 IB(10) of the Act in respect of profits earned from the housing project consisting of Buildings No.2 & 5, Balaji Garden, Koper (E), Dombivali,Dist. Thane. As per the CIT, assessee does not satisfy some of the conditions prescribed in section 80 IB (10) of the Act , therefore, he has set aside the assessment order dated 13/01/2014(supra) with a direction that the Assessing Officer shall make a fresh assessment in compliance with the directions contained in his order. Before, us the assessee has preferred an appeal by raising various Grounds, but the primary grievances is that the CIT was not justified in holding that the assessment order dated 13/1/2014(supra) was erroneous, in so far as, it is prejudicial to the interests of the Revenue within the meaning of section 263 of the Act. The stand of the assessee is that it is wrong on the part of the CIT to hold that the assessee has not satisfied some of the conditions prescribed under section 80 IB(10) of the Act and further it is also wrong on the part of the CIT to say th....
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....in the built-up area calculated by the architect, which violated the condition contained in clause (c) of section 80IB(10) of the Act. For the aforesaid reasons, the CIT has proceeded to hold that the assessee firm does not satisfy the conditions prescribed under the provisions of section 80IB(10) of the Act and, therefore, he has set-aside the assessment requiring the Assessing Officer to re-do the same. 5. Before us, the Ld. Representative for the assessee has vehemently argued that the project of the assessee satisfies all the conditions prescribed as per the provisions of section 80IB(10) of the Act and in this context, he has referred to a detailed chart made in the assessment order, which brings out the manner in which all the conditions prescribed as per the provisions of section 80 IB(10) of the Act have been complied with. At the time of hearing, Ld. Representative for the assessee has also referred to the relevant material placed in the Paper Book so as to support the chart contained in the assessment order, which enumerates the various contentions. In so far as the specific objections of the CIT is concerned, it is submitted that assessee has considered the project of B....
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....within the time limit of five years prescribed in section 80 IB(10) of the Act, but the Local authority did not issue the certificate within 21 days nor did it communicate any objection to the assessee and, therefore, following a petition moved by the assessee The Court of Joint Civil Judge, Junior Division Kalyan held that the Local authority not having rejected the application within 21 days, as per Rule-38 of the Corporation Development Control Regulations, the application is deemed to have been accepted. Therefore, as per the Court order, the Local authority is deemed to have issued the completion certificate for the Buildings No.2 & 5 on the basis of the application dated 19/03/2010; and, a copy of such certificate dated 17/09/2013 has been placed at page 60A of the Paper Book. 6. Before we proceed further, at this stage, we may refer to the other objection raised by the CIT, which is to the effect that the built-up area of the flats in the project might be in excess of 1000 sq.fts., which violates the condition prescribed in clause (c) of section 80 IB(10) of the Act. This stand of the CIT is based on the premise that the area of balcony is to be included in the calculation ....
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....sessment year 2010-11, the fact of the inspection having been carried out with respect to the area of some of the flats is corroborated in the affidavit in reply as filed by the Assessing Officer. In this context, a copy of the affidavit-in reply of the Assessing Officer has been placed on record, which brings out the assertions of the assessee. For all the above reasons, it is canvassed that the CIT has erred in coming to a presumption that built-up area of some of the flats might exceed 1000 sq.fts., if balconies are included. 7.1 Before us, it has also been vehemently canvassed that appropriate enquiries have been made at the time of assessment proceedings and that it is not a case of lack of enquiries and that the CIT has proceeded on misinterpretation of the architect's certificate on the issue of the built-up area of flats. 8. On the other hand, the Ld. Departmental Representative has not contested any of the factual matrix brought out by the Ld. Representative for the assessee, but has primarily reiterated the stand of the CIT that all the buildings in the complex 'Balaji Garden' were not completed within the stipulated date and, therefore, the deduction under section 80 I....
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....ing project' has not been defined. The point for consideration is as to whether in the facts of the present case, the assessee firm is justified in considering the group of Buildings No.2 & 5 in the 'Balaji Garden' complex as a 'project' for the purposes of claim of deduction under section 80 IB (10) of the Act. A somewhat similar issue had come-up in the case of M/s. Vandana Properties (supra), wherein a singular building namely, "E "building was sought to be construed as a housing project for the purposes of section 80 IB (10) of the Act, whereas the Revenue contended that project for the purposes of section 80 IB(10) has to be reckoned after taking into account the other buildings constructed on the same piece of land. In this context, the Hon'ble High Court noted that in the absence of the expression 'housing project' being defined under the Act or even under Bombay Municipal Corporation Act, 1988, such expression for the purposes of section 80IB(10) of the Act has to be considered as commonly understood. In this context, Hon'ble High Court observed that the expression 'housing project' in common parlance would mean constructing building or group of buildings consisting....
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....es that the residential units comprised in the housing project must have a maximum built-up area of 1000 sq.fts., where such residential unit is situated within the states of Delhi or Mumbai or within 25 Kms. from the municipal limits of these states and 1500 sq.fts. at any other place. The case made out by the CIT on this aspect is that the certificate of built-up area of flats issued by the architect shows that the built-up area of some of the flats is very near the figure of 1000 sq.fts and that, if the area of balcony is added, the total 'built-up area' might exceed 1000 sq.fts. Therefore, according to the CIT, the Assessing Officer ought to have carried out the necessary verification. In this context, it is noticed that 'built-up area' has been defined in section 80 IB (14)(a) of the Act, which means the inner measurements of the residential units at the floor level, including the projections and balconies, as increased by the thickness of the walls but it does not include the common areas shared with other residential units. In the background of the aforesaid definition of 'built-up area', we have perused the relevant certificate of the architect, which is placed at pages 61 ....