Deemed ownership for housing project deduction extends to developer profits, including unutilized FSI, despite title in landowner's name.

For section 80IB(10) of the Income-tax Act, a developer in possession under a development agreement who has undertaken construction is treated as satisfying the ownership requirement through deemed transfer under section 2(47)(v) read with section 53A of the Transfer of Property Act. Deduction cannot be denied merely because the approval or completion certificate stands in the landowner's name, so the developer remains eligible for the housing project deduction. The same settled principle extends to composite project profits, including profit attributable to unutilized FSI, which also falls within the deduction.

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Issues: Whether deduction under section 80IB(10) of the Income-tax Act, 1961 was admissible where approval and completion certificate stood in the landowner's name and whether profit from sale of unutilized FSI was outside the ambit of the deduction.

Analysis: The dispute was governed by the settled principle that, where the developer had entered into a development agreement, taken possession, and carried out construction, the requirements of ownership were satisfied for the limited purpose of section 80IB(10) by applying section 2(47)(v) of the Income-tax Act, 1961 read with section 53A of the Transfer of Property Act, 1882. On that basis, the assessee was treated as the person developing and building the housing project notwithstanding that formal title, approval, or completion certificate stood in the landowner's name. The Court also followed the same settled view in relation to the composite project profits, including the component arising from unutilized FSI.

Conclusion: The assessee was entitled to deduction under section 80IB(10) and the revenue's challenge failed.

Final Conclusion: The appeal was rejected because the questions of law stood concluded in favour of the assessee by binding precedent.

Ratio Decidendi: For the purpose of section 80IB(10) of the Income-tax Act, 1961, a developer in possession under a development agreement who has undertaken construction is treated as satisfying the ownership requirement on the doctrine of deemed transfer and part performance, and the deduction cannot be denied merely because legal title or approvals stand in the landowner's name.

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