TaxTMI 
TaxTMI 
2010 (2) TMI 791
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.... (2) It may please be held that an area of amenity space admeasuring about 690.70 sq. mtrs., compulsory required to be handed over to Pune Municipal Corporation by the appellant out of land at S. No. 123/1 Kalas, Pune constitutes an integral part of the housing project and hence the same is required to be considered while calculating the area of plot of land of the housing project for the proposes of exemption under s. 80-IB(10) of the IT Act, 1961. (3) The learned CIT(A) has erred in holding that the letter dt. 14th Sept., 2005 issued by the Asstt. City Engineer (Planning and Development) Pune Municipal Corporation to the partner of the appellant firm constituted fresh evidence not entitled to be admitted. The said letter being of a calcinatory letter the same may please be admitted as evidence and on the basis of the said letter it may please be held that the amenity space admeasuring 690.70 sq. mtrs. constitutes a part of the housing project. (4) The various reasons given by both the lower authorities for holding that the appellant constructed the housing project on a plot of land admeasuring an area of less than one acre being arbitrary, preserve devoid of....
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....of the assessee was that even after reducing the amenity space of 690.70 sq. mtrs. from the demarcated total area available to the assessee admeasuring 5,048.48 sq. mtrs. the balance available area for the development was 4,357.78 sq. mtrs. The assessee has therefore contested that the plot area was more than 1 acre therefore entitled for the claim of deduction under s. 80-IB(10). 2.2 The AO was not convinced and he has referred few more facts that the development rights purchased by the assessee were only in respect of 4,600 sq. mtrs. of plot. He has also mentioned that the PMC has also approved the layout plan vide sanction dt. 27th March, 2000 only in respect of 4,600 sq. mtrs. By referring cl. (b) of s. 80-IB(10) the AO has mentioned that the size of the plot of land should be 1 acre on which the project had to be constructed to get the benefit of the deduction under the said section. He has also referred a certificate issued by an architect wherein the area of plot available for the construction was said to be 3,344.24 sq. mtrs. which was admittedly less than the prescribed area of 1 acre. In addition to above, the AO has also mentioned that on Form No. 10CCB the aud....
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....ssistant Engineer, Pune Municipal Corporation (DP). As per this plan, the area of the plot is 3,344.24 sq. mtrs. (4) As per p. 43 of the paper book submitted by the appellant in this office dt. on 11th Oct., 2005 copy of which was given to the AO for comments at the instance of this office is the plan for proposed residential complex at S. No. 123/1, Plot No. 3, Kalas, Tal. Haveli. As per this plan, the area of the plot is 3,344.24 sq. mtrs." 4. Finally the action of the AO was affirmed. Being aggrieved now the assessee is further in appeal. 5. From the side of the appellant Mr. Sunil Ganoo appeared and stated that he had basically two-folds of arguments. One of the argument is in respect of grounds 1 to 4 and the second line of argument is in respect of ground No. 5. He has stated that if he will succeed in establishing the total area of plot in question as contested in ground No. 5 then the purpose would be served as the assessee shall get the benefit of deduction under s. 80-IB(10). In this regard he has submitted that the plot of land in question was demarcated as 5,048.48 sq. mtrs. This demarcation was always in the knowledge of the authorities wh....
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....ependent Government authority therefore such boundaries should be treated as correct measurement. He has mentioned that as per r. 13 on receipt of the application for the purpose of demarcation, the Collector shall cause the survey number to be measured by the District Inspector and get the boundary marks fixed in accordance with the provisions of these rules. The demarcated boundaries were therefore available for the purpose of the project learned Authorised Representative has concluded. 6. On the other hand from the side of the Revenue learned CIT-Departmental Representative Mr. Mukulesh Dube appeared and strongly supported the view expressed by the authorities below. The main plank of the argument of the learned Departmental Representative was that once the excessive area was not under the ownership of the assessee then how it can be said to be the plot available for the project of the assessee. He has placed reliance on certain documents which were also highlighted by learned CIT(A) as per the relevant para already reproduced above to establish that all the authorities have taken into account the area which was purchased by the assessee i.e., 4,600 sq. mtrs. Rather le....
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.... of 4,600 sq. mtrs. the calculation for granting open space, amenity space, internal road had started. Therefore one thing is evident and also undisputed that the concerned authorities have made all the calculation for rest of the purposes starting with the area of 4,600 sq. mtrs. Even this is also not in dispute that while calculating the 15 per cent amenity space the calculation was based upon 4,600 sq. mtrs. and not 5,048.48 sq. mtrs. The outcome of this discussion is that we have to give due credence to all such evidences through which the area in question was earmarked as 4,600 sq. mts. 7.1 Reverting back to the legal aspect, presently we are dealing with a specific section which prescribes deduction to an undertaking engaged in developing and building of housing project. The section applicable to resolve this controversy is s. 80-IB(10)(b) which reads as follows:- "(b) The project is on the size of a plot of land which has a minimum area of one acre." 7.2 The language of the impugned section is such that the project has to be on the size of a plot of land which has a minimum area of 1 acre. The basic condition is that the project should be develo....
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....il disputes in nature and in such civil cases the question of easement rights or the right of possession has to be determined on the basis of the boundaries over which such rights are generally exercised and in those disputes the description/dimensions may or may not match with the boundaries. Such nature of disputes can only be resolved on the basis of the actual existence of the availability of land at the site though the dimensions on paper might differ. To resolve those types of disputes and the conflict, the Courts have thus held that the boundaries as existed at the site must prevail over the dimensions. Be that as it was, we are not on those issues and the controversy for our adjudication is altogether different. For the purpose of the applicability of s. 80-IB(10) one has to simply ascertain the size of plot available for the impugned housing project. Any other approach may lead to an inappropriate situation so as to allow the assessee to encroach the adjacent land and thereupon such an encroachment be claimed to be treated as part of the project on 1 acre land. Our interpretation of the language of the provisions is that the statute has not only specified the measurement b....
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....r building 3,344.21 sq. mtrs." 8.1 As per the Revenue authorities, both AO and learned CIT(A), since the net area available for the purpose of construction was less than 1 acre therefore the assessee was not entitled for claim of deduction under s. 80-IB(10). However, we are not in agreement with such an approach of the Revenue authorities. To give strength to our reasons for such disagreement we hereby refer one of the point as explained in the CBDT circular cited in (2005) 197 CTR (St) 1 : (2005) 276 ITR (St) 170, wherein the guidelines issued were as follows:- "Extension of the time-limit for obtaining approval of housing projects for the purpose of tax holiday under s. 80-IB, and allowing deduction for redevelopment or reconstruction of existing building in slum areas:- This section does not specifically provide area limit for the garden, the development plan roads, internal means of access, etc., in the housing project. Therefore, the same should conform to the project plan approved by the local authority in accordance with the regulations in force. Also, the area limit of the plot has to be construed with reference to the area of the site on which th....