TaxTMI 
TaxTMI 
2010 (4) TMI 838
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....im citing the following reasons. (i) Project was not exclusively for units with built-up area less than 1500 sq. ft. (ii) Project though stated to be approved by "Kuniamuthur Town Panchayat", the building construction approval was unit wise. The assessee has sold individual sites and through separate agreement undertook to construct the houses therein. (iii) Certificate from the Village Administrative Officer (VAO) could not be accepted since the Village Administrative Officer was not the authority to issue approval for housing proposal. 3. In its appeals before the Commissioner of Income-tax (Appeals) the assessee's contentions were that (i) Just because the project contained housing units with built-up area exceeding 1500 sq. ft. deduction under section 80-IA(10) could not be denied. (ii) The total land area was more than one acre and approval was therefrom Kuniamuthur Town Panchayat. (iii) Narrow interpretation should not be taken for a beneficial provision like section 80-IB(10). 4. However, the learned Commissioner of Income-tax (Appeals) was least impressed. Relying on the Budget Speech of the hon'ble Finance Minister, when the ....
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....s relied on by the assessee should not be applied. 2. We have perused the orders and heard the rival contentions. Taking up the first reason cited for denying the claim, viz. the approval was only for a layout and individual units were separately approved by the local authority which would not suffice the requirement of a project approval, it would be appropriate to have a look at the approval placed at paper book pages 14 and 15 of the assessee's paper book. In the first place, this approval dated February 16, 1987 is given by the Deputy Director Town planning, of Kovai-Periyar-Nilagiri District. Relevant paragraphs 1, 5, 7, 8, 9, 13 and 17 are reproduced hereunder : "1. The plots and roads demarcated and approved in layout plan LP/R(CPN) No. 44/87 have identified by physical marking of stones. The identification has to be in accordance with sections 175 and 179 of Tamilnadu District by placing mountain stones at the places and height specified by the local authorities. The applicant has also to provide for culverts, drainage, street lights and other facilities within the approved layout. The applicant shall not make any change in the approved layout without the prior permis....
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....issue regarding total area of the houses having less than 1500 sq. ft., built-up area, admittedly, the project as a whole well exceeded one acre. The work-sheet of the assessee show that out of 6.47 acres, land area of 3.54 areas were for units less than 1500 sq. ft., and this is much more than 50 per cent vis-a-vis the contention of the learned Departmental representative that where some of the housing units exceeded 1500 sq. ft., no claim under section 80-IA(10) could be allowed and his reliance on various decisions, we are of the opinion all these aspects of the argument, as well as the decisions relied on by him, were considered by the co-ordinate Bench in the case of S. Ravi (supra). Paragraphs 7 to 11 of this decision would clearly show that the contentions of the Departmental representative has to be rejected. These are reproduced hereunder : "7. We have considered the rival contentions, relevant records as well as various decisions relied upon by either parties. The Assessing Officer denied the deduction under section 80-IB(10) on two grounds, firstly, there is no approval of the housing project but only individual residential units were approved ; and secondly, on the g....
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.... 80-IB(10) on proportionate basis as all other conditions prescribed under the provision are satisfied." 10. In the case of Chitra Construction (P.) Ltd. (supra) the co-ordinate Bench of this Tribunal in paragraphs 7.4 and 7.5 has held that, "7.4 Now, in this case, it is an admitted fact that there was a single joint development agreement entered into with the Loyola College, Chennai on February 25, 1999 in respect of a plot of land measuring about 3.05 acres. The development of all the blocks and the floors of this project have to be viewed as composite in nature. The necessary approval from the authorities was also for developing the project. The project, inter alia, consisted of various blocks, which of course consisted of various floors. Hence, when the mandate of section 80-IB(10) is that the exemption in this regard is to be provided to the project in which the residential unit has a maximum built-up area of 1500 sq. ft., then if there is violation of this condition in any of the residential units, there is a clear violation of the provisions of the Act. It is trite law that, when the language of the Act is plain and unambiguous, no interpolation of the same need to be ....
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....ions as contained in section 80-IB(10) and the same has not been disputed by the Assessing Officer also. We have also noted down the fact that even the provision as laid down in section 80-IB(10) does not speak regarding such denial of deduction in case of profit from a housing complex containing both the smaller and large residential units and since the assessee has only claimed deduction on account of smaller qualifying units by fulfilling all the conditions as laid down under section 80-IB(10), the denial of claim by the assessee is on account of rather restricted and narrow interpretation of the provisions of clause (c) of section 80-IB(10) while coming to such conclusion, we also find support from the order of the hon'ble Supreme Court in the case of Bajaj Tempo Ltd. v. CIT [1992] 196 ITR 188 (SC), wherein it was held that the provisions should be interpreted liberally and since in the present case also, the assessee by claiming pro rata income on qualifying units has complied with all the provisions as contained in the said section, in our considered opinion, such claim of the assessee was rightly allowed by the learned Commissioner of Income-tax (Appeals) by reversing the or....