ITAT upheld CIT(A)’s order allowing deduction

1. Assessee was engaged in the business of construction as M/s. Suman Constructions.

2. She had undertaken residential cum commercial project and claimed deduction u/s 80IB(10) (of Income Tax Act, 1961).

3. A survey u/s 133A (of Income Tax Act, 1961) was carried out at the premises of the assessee.

4. AO noted that assessee was constructing project on land admeasuring 2,33,180 sq.ft.

5. AO held that where the area of commercial unit exceeded 2000 sq.ft., it was not entitled to the claim of deduction us 80IB(10).

6. The Certificate submitted by the assessee of Grampanchayat regarding built up area of bungalows and drawings of the bungalows, was not accepted by the AO holding that the said area was includable in the hands of assessee.

7. CIT(A) allowed the assessee’s appeal.

On Revenue’s appeal, the ITAT held as under:

8. The commercial project which has been sanctioned, commenced and completed on a later date and on which, no deduction under section 80IB(10) (of Income Tax Act, 1961) has been claimed by the assessee, is a separate project from the residential project of row houses completed by the assessee.

9. Accordingly, we find no merit in the order of Assessing Officer in this regard and upholding the order of CIT(A), we hold that the assessee is entitled to the claim of deduction under section 80IB(10) (of Income Tax Act, 1961).

10. In view thereof, there is no merit in the observations of Assessing Officer that the assessee is not entitled to the claim of deduction under section 80IB(10) (of Income Tax Act, 1961) since the commercial area exceeded 2000 sq.ft.

Case Reference - The Dy. Commissioner of Income Tax Vs. Smt. Suman Jagannath Pharande.

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH "A", PUNE

BEFORE MS. SUSHMA CHOWLA, JM AND SHRI PRADIP KUMAR KEDIA, AM

ITA No s.711 & 712/PN/2012

(Assessment Years: 2006-07 & 2008-09)