Sanctioned housing project area governs the one-acre test under section 80-IB(10)(b), including mandatory amenity space.

For deduction under section 80-IB(10)(b), the relevant plot area is the area actually recognised in the sanctioned housing project, not a larger unapproved demarcated extent. Project documents, the sanctioned layout and municipal calculations showed 4,600 sq. mtrs. as the operative plot area, and the larger demarcated area was not treated by the sanctioning authority as part of the project. Mandatory amenity space, open space and internal roads required by the local authority formed part of the sanctioned project area and could not be excluded for the one-acre test. The deduction was therefore available on the basis of the sanctioned 4,600 sq. mtrs., while reliance on the larger demarcated area was rejected.

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Issues: (i) Whether the area of 5,048.48 sq. mtrs. stated on demarcation could be treated as the plot area for the purpose of section 80-IB(10)(b), and (ii) whether the 15% amenity space required by the local authority formed part of the housing project plot for computing the minimum area of one acre.

Issue (i): Whether the area of 5,048.48 sq. mtrs. stated on demarcation could be treated as the plot area for the purpose of section 80-IB(10)(b).

Analysis: The project documents, development agreement, sanctioned layout and municipal calculations consistently proceeded on the basis of 4,600 sq. mtrs. as the plot area. The larger demarcated area was not the subject-matter of the development agreement and was not treated by the sanctioning authority as part of the project for working out amenities, roads or FSI. The statutory requirement was that the housing project must be on a plot having a minimum area of one acre, and the broader demarcated area could not be substituted for the area actually recognised for the project.

Conclusion: The claim that 5,048.48 sq. mtrs. should be taken as the project plot area was rejected.

Issue (ii): Whether the 15% amenity space required by the local authority formed part of the housing project plot for computing the minimum area of one acre.

Analysis: The approved plan and the municipal computation showed that amenity space, open space and internal road area were mandatory components of the sanctioned project. The local authority required such reservation as part of the approval process, and additional FSI was granted in relation to the space set apart. The area for the purposes of section 80-IB(10)(b) had therefore to be understood with reference to the site area on which the project was sanctioned, inclusive of mandatory amenities, rather than by excluding them and insisting on a net built-up area exceeding one acre.

Conclusion: The 15% amenity space was to be treated as part of the project area, and the assessee was entitled to deduction under section 80-IB(10)(b) on the basis of 4,600 sq. mtrs.

Final Conclusion: The assessee succeeded on the core eligibility issue for deduction under section 80-IB(10)(b) to the extent that the sanctioned plot area, including mandatory amenity space, satisfied the one-acre requirement, while the contention based on the larger demarcated area was rejected.

Ratio Decidendi: For section 80-IB(10)(b), the relevant plot area is the area actually recognised in the sanctioned housing project plan, including mandatory amenity reservations required by the local authority, and not an unutilised or unapproved larger demarcated area.

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