M/s. Shubhmangal Construction, Pune v. ACIT, Circle-3, Pune

ITA 1014/PUN/2009 | 2006-2007
Pronouncement Date: 09-11-2011 | Result: Allowed

Appeal Details

RSA Number 101424514 RSA 2009
Assessee PAN AATFS8346L
Bench Pune
Appeal Number ITA 1014/PUN/2009
Duration Of Justice 2 year(s) 2 month(s) 15 day(s)
Appellant M/s. Shubhmangal Construction, Pune
Respondent ACIT, Circle-3, Pune
Appeal Type Income Tax Appeal
Pronouncement Date 09-11-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 09-11-2011
Date Of Final Hearing 09-09-2011
Next Hearing Date 09-09-2011
Assessment Year 2006-2007
Appeal Filed On 24-08-2009
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV JUDICIAL MEMBER AND SHRI G.S. PANNU ACCOUNTANT MEMBER I.T.A. NO. 1014/PN/2009 : A.Y. 2006-07 SHUBHAMANGAL CONSTRUCTION 326 M.G. ROAD PUNE-411 001 PAN AATFS 8346 L APPELLANT VS. ASSTT. CIT CIR. 3 PUNE RESPONDENT APPELLANT BY: SHRI NIKHIL PATHAK RESPONDENT BY: SHRI HARESHWAR SHARMA DATE OF HEARING: 9-9-2011 DATE OF PRONOUNCEMENT : 9-11-2011 ORDER PER SHAILENDRA KUMAR YADAV JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF CIT(A)-II PUNE DATED 15-7-2009 ON THE POIN T OF CONFIRMATION OF DISALLOWANCE OF DEDUCTION OF RS. 3 84 94 540/- U/S 80-IB(10) CLAIMED IN RESPECT OF P ROJECT ADITYA NAKODA ENCLAVE. 2. THE LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY T HE DECISION OF CO-ORDINATE BENCH OF THE TRIBUNAL IN TH E CASE OF OPEL SHELTERS PVT. LTD. VS. ACIT IN ITA NO. 219/PN/ 2009 FOR A.Y. 2005-06 DATED 31-5-2010 AND ALSO BY THE DE CISION OF CO-ORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF KUMAR BEHARAY RATHI VS. ACIT IN ITA NO. 1033/PN/2009 FOR A.Y. 2 ITA NO. 1014/PN/2009 SHUBHAMANGAL CONSTRUCTION A.Y. 2006-07 2005-06 DATED 5-8-2011. THE LEARNED AR FOR THE ASSE SSEE DREW OUR ATTENTION TO PAGE 8 OF THE PAPER BOOK AND SUBMITTED THAT THE PLANS WERE SANCTIONED PRIOR TO AMENDMENT I.E. 1-4-2005. THE RELEVANT DETAILS ARE A S FOLLOWS: DETAILS OF PLANS SANCTIONED SR. NO. SANCTION DATE COMMENCEMENT CERTIFICATE NO. RESIDENTIAL AREA )(IN SQ. MTR) COMMERCIAL AREA (IN SQ. MTR) 1. 21 - 01 - 2 003 5858 4 454.69 1 453.41 2 22 - 5 - 2003 5894 12 233.29 1 453.41 3. 20 - 3 - 2004 2217 12 233.29 1 453.41 4. 30 - 12 - 2004 3627 12 520.29 1 507.77 IN VIEW OF ABOVE THE LEARNED AR SUBMITTED THAT THE CLAIM OF THE ASSESSEE BE ALLOWED. THE LD. D.R. ON THE O THER HAND TRIED TO JUSTIFY THE ORDERS OF THE AUTHORITIES BELO W. HE SUBMITTED THAT ADMITTEDLY THE AMENDED PROVISIONS U/S. 80IB ( 10) W.E.F. 1.4.2005 HAD COME INTO OPERATION DURING THE A.Y. U NDER CONSIDERATION I.E. 2006-07 HENCE IT IS VERY MUCH A PPLICABLE IN THE CASE OF ASSESSEE FOR MAKING ASSESSMENT FOR THE YEAR ON THE PROFITS SHOWN RECEIVED FROM THE PROJECT ON WHICH DEDUCTIO N HAS BEEN CLAIMED. 3. WE FIND THAT THE ISSUE RAISED IN THIS APPEAL IS SQUARELY COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF TRIBUN AL IN THE CASE OF KUMAR BEHARAY RATHI IN ITA NO. 1033/PN/2009 DATED 5 -8-2011 WHEREIN THE ISSUE HAS BEEN DECIDED AS UNDER: 5. CONSIDERING THE ABOVE SUBMISSION AND HAVING GON E THROUGH THE ORDER DATED 31 ST MAY 2011 OF THE TRIBUNAL IN THE CASE OF OPEL SHELTERS PVT. LTD. & OTHERS RELIED UPO N BY THE LD. A.R. WE FIND THAT AN IDENTICAL ISSUE UNDER ALMOST SIMILAR FACTS AND CIRCUMSTANCES HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE. THE RELEVANT PARA NO. 20 OF THE SAID ORDER IS BEING REPRODUCED FOR A READY REFERENCE. 3 ITA NO. 1014/PN/2009 SHUBHAMANGAL CONSTRUCTION A.Y. 2006-07 20. BY APPLYING THE PRINCIPLE OF HARMONIOUS CONSTRUCTION TO INTERPRET THE PROVISIONS UNDER SUB- SECTION (10) TO SECTION 80IB AS AMENDED W.E.F. 1.4. 2005 WE COME TO THE CONCLUSION THAT THE LEGISLATURE ALWA YS INTENDED THAT THE PROJECT MUST BE APPROVED BY THE L OCAL AUTHORITY THUS IN THOSE APPROVED PROJECTS WHERE CONSTRUCTION HAS BEEN STARTED MUCH EARLIER THAN 1.4.2005 THE ASSESSEES ARE REQUIRED TO COMPLETE TH E PLAN AS IT HAS BEEN APPROVED. AS PUTTING SUCH ASSESSEES TO COMPLETE THE PLAN MEETING OUT CONDITION UNDER CLAUS E (D) OF THE SUB-SECTION WOULD LEAD INTO ABSURDITY AND IMPOSSIBILITY FOR THE ASSESSEE AND IN CONTRADICTIO N TO THE PROVISIONS U/S. 80 IB(10) AS PREVAILED AT THE TIME OF APPROVAL AND COMMENCEMENT OF THE CONSTRUCTION OF T HE PROJECT WELL BEFORE 1.4.2005. BOMBAY BENCH OF THE TRIBUNAL IN THE CASE OF HIRANANDANI AKRUTI J.V (SUP RA) HAS DISCUSSED ALL THESE RELEVANT ASPECTS RAISED BY THE DEPARTMENT. IN THE CASE OF HIRANANDANI AKRUTI J.V V/S. DCIT IT HAS BEEN HELD THAT THE LAW AS EXISTED WHEN THE ASSESSEE SUBMITTED ITS PROPOSAL AND PERMISSION FOR CARRYING OUT THE DEVELOPMENT WAS ACCORDED AND WHEN THE ASSESSEE COMMENCED DEVELOPMENT IS TO BE APPLIED. IN THE PRESENT CASES AS PER PAGE NOS. 17 AND 20 OF T HE PAPER BOOK IN THE CASE OF OPEL SHELTER THE PROJECT WAS COMMENCED ON 23.2.2001 AND EVEN COMPLETED ON 14.5.2004 SIMILARLY AS PER THE CONTENTS OF PAGE NO .2 OF THE ASSESSMENT ORDER AND PAGE NO. 41 OF THE PAPER BOOK IN THE CASE OF D.S. KULKARNI AND ASSOCIATES THE P ROJECT WAS COMMENCED ON 12.4.2001 AND COMPLETED IN THE MONTH OF NOVEMBER 2003. THUS THE ASSESSEES WERE SUPPOSED TO COMPLETE THE PROJECTS AS PER THE LAW A S EXISTED IN THE A.Y. 2001-02 IN THE CASE OF OPEL SHE LTERS AND IN THE A.Y. 2002-03 IN THE CASE OF D.S. KULKARN I AND ASSOCIATES. WE THUS FOLLOWING THE DECISION IN THE CASE OF HIRANANDANI AKRUTI JV V/S. DCIT (SUPRA) HOLD THAT AMENDED PROVISIONS UNDER SECTION 80 IB(10) W.E.F. 1.4.2005 ARE NOT APPLICABLE IN THE PRESENT CASE HE NCE ASSESSEES ARE ELIGIBLE FOR THE CLAIMED DEDUCTION U/ S. 80 IB (10) OF THE ACT. WE ACCORDINGLY DIRECT THE A.O TO ALLOW THE CLAIMED DEDUCTION TO THE ASSESSEES. 6. ADMITTEDLY IN THE PRESENT CASE APPROVAL TO THE PROJECT IN QUESTION WAS GIVEN BY THE PMC DURING THE YEAR 2001 (30 TH MARCH 2001 AND 28 TH JUNE 2001) HENCE AS PER ABOVE DECISION IN THE CASE OF OPEL SHELTERS PVT. LTD. & OTHERS TH E LAW AS EXISTED DURING THE PERIOD WHEN APPROVAL WAS GRANTED BY THE PMC WILL BE APPLICABLE TO THE ASSESSEE AS THE ASSES SEE CANNOT BE EXPECTED TO COMPLETE ITS PROJECT AS PER THE LAW IN EXISTENCE 4 ITA NO. 1014/PN/2009 SHUBHAMANGAL CONSTRUCTION A.Y. 2006-07 IN THE COMING A.Y. 2005-06. WE THUS FOLLOWING TH E ABOVE DECISION DECIDE THE ISSUE IN FAVOUR OF THE ASSESSE E THAT THE AMENDED PROVISIONS U/S. 80 IB (10) CAME INTO EFFEC T FROM 1.4.2005 ARE NOT APPLICABLE IN THE CASE OF ASSESSEE HENCE THE A.O WAS NOT JUSTIFIED IN DENYING THE CLAIMED DEDUCT ION ON THE BASIS THAT THE CONSTRUCTED COMMERCIAL AREA WAS EXCE EDING 2000 SQ. FT. AS PER THE AMENDED PROVISIONS. SO FAR AS THE DISALLOWANCE OF DEDUCTION BY THE A.O ON THE BASIS T HAT THE DEDUCTION IS RESTRICTED TO RESIDENTIAL UNITS ONLY THE SAME HAS ALREADY BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY T HE HONBLE BOMBAY HIGH COURT IN THE CASE OF BRAHMA ASSOCIATES (SUPRA) UPHOLDING THE DECISION OF THE TRIBUNAL THAT THE D EDUCTION U/S. 80 IB (10) IS AVAILABLE EVEN ON THE PROJECTS APPROVED BY THE PMC AS RESIDENTIAL + COMMERCIAL AND THE SAME CO MES WELL WITHIN THE MEANING OF HOUSING PROJECT IN THE PROV ISIONS U/S. 80 IB (10) OF THE ACT. WE THUS WHILE SETTING AS IDE ORDERS OF THE AUTHORITIES BELOW ON THE ISSUE DIRECT THE A.O TO ALLOW THE CLAIMED DEDUCTION. THE GROUND IS ACCORDINGLY ALL OWED. 4. FACTS BEING IDENTICAL SO FOLLOWING THE AFORESAI D DECISION OF THE TRIBUNAL IN THE CASE OF KUMAR BEHAR AY RATHI (SUPRA) WE HOLD THAT THE AUTHORITIES BELOW WERE NOT JUSTIFIED IN MAKING THE DISALLOWANCE U/S 80-IB(10) OF THE ACT IN RESPECT OF THE PROJECTS ADITYA NAKODA ENCLAV E. WE DIRECT ACCORDINGLY. 5. IN THE RESULT THE APPEAL OF THE ASSESSEE IS ALL OWED. PRONOUNCED IN THE OPEN ON 9 TH NOVEMBER 2011. S D/ - (G.S. PANNU) ACCOUNTANT MEMBER S D/ - (SHAILENDRA KUMAR YADAV) JUDICIAL MEMBER PUNE DATED THE 9 TH NOVEMBER 2011 ANKAM COPY OF THE ORDER IS FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT III PUNE 4. CIT(A)-II PUNE 5. THE D.R ITAT PUNE BENCH PUNE 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY 5 ITA NO. 1014/PN/2009 SHUBHAMANGAL CONSTRUCTION A.Y. 2006-07 INCOME TAX APPELLATE TRIBUNAL PUNE BENCHES PUNE.