ITAT upholds CIT(A) decisions on Section 80IB(10) deduction, dismisses Revenue's profit contentions.

The ITAT upheld the CIT(A)'s decisions in both appeals, allowing the deduction under Section 80IB(10) for the assessee and dismissing the Revenue's contentions regarding the profit derived from the sale of unutilized FSI. Both appeals of the Revenue were dismissed.

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Issues:
1. Allowance of deduction under Section 80IB(10) for the assessee.
2. Profit derived from the sale of unutilized FSI and its eligibility for deduction under Section 80IB(10).

Issue 1: Allowance of deduction under Section 80IB(10) for the assessee:

The appeals filed by the Revenue for A.Y:2008-09 & 2009-10 contested the orders of CIT(A)-II, Baroda directing the Assessing Officer to allow the deduction u/s. 80IB(10) r.w.s. 80IB(1) of the Income Tax Act to the assessee. The main contention was that the approval by the local authority and completion certificate were granted to the landowner, not the assessee, and the transfer of dwelling units was done by the landowner, not the assessee. The ITAT upheld the CIT(A)'s decision based on previous judgments where it was established that the assessee had dominant control over the projects and developed the land at their own risk and costs. The Tribunal dismissed the Revenue's grounds, stating that no contrary material was presented, and the issue was directly covered by a previous order. The Tribunal emphasized that the Revenue Department should not contest the directions given to the Assessing Officer in this matter.

Issue 2: Profit derived from the sale of unutilized FSI and its eligibility for deduction under Section 80IB(10):

Regarding the profit derived from the sale of unutilized FSI, the Assessing Officer had denied the deduction under Section 80IB(10) on the grounds that the profit was not derived from the activities of development and construction. The ITAT cited a decision where it was clarified that there was no requirement as to the FSI under the provisions of Sec. 80IB(10). The Tribunal also referred to a case where it was stated that the concept of unutilized FSI sold was imaginary and based on surmises and conjectures. The Tribunal approved the decision of the CIT(A) and dismissed the Revenue's ground related to the profit derived from the sale of unutilized FSI.

In conclusion, the ITAT upheld the CIT(A)'s decisions in both appeals, allowing the deduction under Section 80IB(10) for the assessee and dismissing the Revenue's contentions regarding the profit derived from the sale of unutilized FSI. Both appeals of the Revenue were dismissed.

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