TaxTMI 
TaxTMI 
2012 (7) TMI 88
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....s granted benefit of Section 80IB (10) of the Income Tax Act, 1961 (for short hereinafter referred to as the Act) on the ground that the assessee was an integral part of the construction activities. 3. The assessee firm is engaged in the business of development and construction of residential flats. It came into existence in the year 1995. It purchased agricultural land measuring 2 acres 39 guntas for an amount of Rs. 11,24,100/- at Amruthahalli Village, Yelahanka Hobli, Bangalore North Taluk. The sale deed was not registered. A Memorandum of Understanding was entered on 16.05.1996 with the land owners and the assessee took possession of the property. On 19.12.1997, a joint development agreement was entered into by the assessee as "consent....
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....im of the assessee with regard to whether the role of the assessee firm's in the above project could be interpreted as development and construction activity for the purpose of Section 80IB(10) of the Act. The assessee made an application to the Additional Commissioner of Income Tax requesting to allow its claim under Section 80IB(10). The Additional Commissioner of Income Tax held that although the assessee satisfied most of the conditions laid down in Section 80IB(10), however, since the assessee itself has not developed and built the housing project, he held that the deduction under Section 80IB(10) could not be made available to the assessee. He further held that the provisions of Section 80IB(10) provided for deduction of profits from h....
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....essee is entitled to deduct under Section 80IB(10) of the Act admittedly when the assessee has not carried out activity of developing and building house project and has merely assisted the developer/promoter in the project?" 5. Sub-Section (10) of Section 80IB enables an undertaking, which is developing and building housing projects approved before the 31st day of March 2008 by a local authority, shall be hundred percent of the profits derived in the previous year relevant to any assessment year from such housing project. The said section also provides the conditions to be fulfilled before claiming benefit of deduction under the said provision. 6. In the instant case, all those conditions are fulfilled. However, the dispute is when the as....
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.... owner of the land was made a party to the said proceedings. Thus, the assessee contributed the land, undertook the aforesaid developmental activities in the said land and thus, complied with all other conditions, which have to be fulfilled before claiming benefit under Section 80IB(10) of the Act. The builder has invested the money in the construction. It is after completion of the building in terms of the agreement, the assessee was given 22% share of the building area. It is after sale of the built area, in terms of Section 80IB (10), the assessee is claiming deduction. As is clear from the joint development agreement, the undertaking of developing and building housing project was jointly undertaken by the assessee and the builder. There....