Section 80-IB(10) deduction depends on real development risk and control, not land ownership or approval name alone.

Section 80-IB(10) relief does not depend solely on legal ownership of the land or on local authority approval being in the assessee's name; ownership is not an express statutory condition. Entitlement turns on whether the assessee is the developer undertaking the housing project on its own cost and risk with effective dominion over the project. A development agreement must be examined on its substance, not its label: where the assessee bears expenses, secures permissions, and assumes business risk, deduction is available; where it merely acts as a contractor for fixed remuneration, deduction is not available and factual verification is required.

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Issues: (i) Whether deduction under section 80-IB(10) could be denied merely because the assessee was not the owner of the land or the local authority approval stood in the landowner's name. (ii) Whether the assessee, on the terms of the development agreement, acted as a developer undertaking the project on its own cost and risk, or merely as a contractor/agent for the landowner.

Issue (i): Whether deduction under section 80-IB(10) could be denied merely because the assessee was not the owner of the land or the local authority approval stood in the landowner's name.

Analysis: The deduction under section 80-IB(10) is available to an undertaking developing and building housing projects approved by the local authority. The provision does not expressly require that the assessee must be the legal owner of the land. The earlier view in Radhe Developers was applied to hold that ownership of land is not, by itself, a statutory condition for the deduction. The existence of approval in the landowner's name also did not, by itself, disqualify the assessee where the development rights and obligations were in substance with the assessee.

Conclusion: Deduction under section 80-IB(10) cannot be refused solely on the ground that the assessee was not the registered owner or that the approval was in the landowner's name.

Issue (ii): Whether the assessee, on the terms of the development agreement, acted as a developer undertaking the project on its own cost and risk, or merely as a contractor/agent for the landowner.

Analysis: The nature of the agreement had to be determined from its terms and not from its label. On the facts of the lead case, the agreement transferred effective dominion and development rights to the assessee, who bore the expenses, obtained permissions, undertook construction, and assumed the business risks. Fakir Chand Gulati was distinguished because that case involved a true collaboration agreement with sharing of constructed area, whereas the present agreement was treated as an agreement for sale coupled with development rights. However, for the connected matters where the agreement was not fully examined, the matters were restored to the Assessing Officer to verify whether the assessee had in fact purchased the land for a fixed consideration and developed the project on its own cost and risk, or had merely acted on behalf of the landowner for fixed remuneration.

Conclusion: Where the assessee had dominant control and developed the project on its own cost and risk, deduction was allowable; where the assessee had merely acted as a contractor for fixed consideration, deduction was not allowable and the matter required factual verification.

Final Conclusion: The legal position was clarified that ownership of land is not an absolute prerequisite for section 80-IB(10) relief, but entitlement depends on whether the assessee is the real developer bearing the project risks and exercising effective control over the housing project.

Ratio Decidendi: For section 80-IB(10), the decisive test is whether the assessee is the undertaking that actually develops and builds the housing project on its own cost and risk with effective dominion over the project, not whether it holds legal title to the land or the local approval is in its own name.

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