Appellant's Tax Deduction Upheld for Housing Projects in NOIDA

The appellant was entitled to deduction under Section 80 (IB) of the Income Tax Act for housing projects in NOIDA. The ITAT upheld the deduction for units within the statutory limit, emphasizing the approval dates for construction commencement. Regarding the liability to pay income tax on the annual letting value of unsold flats, the Court ruled in line with previous decisions, allowing assessments based on ALV. The appeals related to these issues were disposed of accordingly, with some dismissed and others partly allowed based on established legal precedents.

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Issues:
1. Entitlement to deduction under Section 80 (IB) of the Income Tax Act, 1961.
2. Liability to pay income tax on the annual letting value of unsold flats under the head income from the house property.

Entitlement to Deduction under Section 80 (IB):
The appellant commenced development of housing projects in NOIDA and claimed benefits under Section 80IB. The Assessing Officer disallowed the claim for certain years, leading to appeals and revision proceedings. The ITAT upheld the appellant's contentions, allowing the deduction for units not exceeding the statutory limit. The ITAT held that the deduction was rightly allowed as construction commenced after the approval of building plans post-1.10.98. The High Court rejected the Revenue's contentions, citing the debatable nature of the issue and the application of Supreme Court decisions. The High Court affirmed the Tribunal's findings, emphasizing the importance of approval dates for determining the commencement of construction.

Liability to Pay Income Tax on Annual Letting Value:
The Court addressed whether the assessee could be assessed based on the annual letting value (ALV) of unsold flats. Referring to a previous decision, the Court held that the assessee could indeed be assessed on the ALV of unsold flats. This decision was based on a previous Supreme Court ruling. Consequently, the Court dismissed some appeals while partly allowing one. In another case, the Court affirmed the Tribunal's decision based on previous orders, finding no substantial question of law. As a result, the appeals related to these issues were disposed of accordingly.

This comprehensive analysis of the judgment outlines the issues of entitlement to deduction under Section 80 (IB) and the liability to pay income tax on the ALV of unsold flats. The judgment delves into the factual background, legal arguments, Tribunal's findings, Revenue's contentions, and the Court's reasoning based on relevant legal precedents.

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