TaxTMI 
TaxTMI 
2013 (10) TMI 418
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....appeal for AY 2006-07) 2. First, we shall take up the appeals of the assessee. Assessment Year 2006-07 Though the assessee has raised numbers of elaborate grounds in each relevant assessment year, vide letter dated 29-06-2012, the assessee has furnished concise grounds of appeal, the same are reproduced herein under for reference: "1.1 The Ld. CIT(A) has grievously erred in law or on facts in confirming the disallowance of the deduction u/s. 80-IB(10) of Rs. 42,00,136/- for A.Y. 2006-07 on the ground that the conditions precedent for claiming the same were not fulfilled. 1.2 That in the facts and circumstances of the case as well as in law, the Ld. CIT(A) ought not to have confirmed the disallowance of the claim of deduction u/s.80-IB(10) of Rs. 42,00,136/- for A.Y. 2006-07. 2.1 The Ld. CIT(A) has grievously erred in making reference to DVO and the findings given by DVO are not admitted by the appellant since the same are contrary to the facts on record. 2.2 The Ld. DVO has grievously erred in holding that (a) the built- up area of the bunglows was in excess of 1500 sq.ft and (b) that of commercial establishments in excess of 5% of the aggregate built-up area."....
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.... the aggregate built up area. 3. The assessee is a firm engaged in the business of developing residential housing projects, filed its return of income on 11.10.2006 for the assessment year 2006-07 and finally assessment was completed u/s. 143(3) of the Act on 26.12.2008 and 15.12.2010 for A.Y. 05-06. 4. The brief facts of the case are that the appellant had entered into a development agreement with Devalay (Motera) Co.Op. Housing Ltd., on 09.09.2000 for development of land bearing survey No. 224/B and S.P. No.2 of F.P. No.141/1 admeasuring about 5436 sq.yds., at Nr. ONGC Office [Avani Bhawan], Sabarmati-Kalol Highway, Motera, Ahmedabad (Page-122-134). Later on, a supplementary development agreement was execute on 15.02.2001 with it (PB;Page-81). During the course of assessment proceeding, the ld. A.O. opined and came to conclusion that the assessee was not entitled to claim the benefit for deduction u/s. 80-IB (10) of the Act because of the following reasons: 1. As per terms and conditions of the supplementary development agreement dated. 15.02.2001, the assessee was entitled to fixed charges as remuneration of Rs. 50,00,000/- per annum and therefore, it was evident that t....
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....as fixed fee paid by the Housing Society to the appellant. Therefore, we do not find any merit in this contention of the Revenue. Further, with respect to the construction of the 26th bungalow, the assessee has categorically denied and had replied that it had raised bills for construction of 25 bungalows and not for 26 bungalows. The Revenue had only stated that from the two bills raised by the assessee dated 31.03.2005 and 31.03.2006 of Rs. 50 lacs each mentioned that the fees charge was for 13 bungalows in each bill which meant that the fee was charged for 26 bungalows. Other than this statement, there is not finding by the assessee to establish that the assessee had constructed the 26th bungalow. Further, it is pertinent to note that the DVO's report also do not suggest conclusively that the construction was carried out by the assessee. This is evident from the report of the DVO; the relevant portion of the report is reproduced for reference (paper book page no. 137). "In fact it is noted that in residential unit no.10 one storey has been added and in residential unit no.18, additional construction has been added providing covered parking at ground floor and room above it. Th....
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....e. 10. With respect to the other issue that "The Revenue has erred in holding that the construction of commercial space in the project is in excess of 5% of the aggregate built up area", we are of the considered opinion that the matter is squarely covered by the decision of the Hon'ble Jurisdictional High Court in case of Manan Corporation vs. ACIT cited by the assessee (supra) for the assessment year 2006-07. "As is very apparent from the record, there were no criteria for making commercial construction prior to the amended section and the plans are approved as housing projects by the local authority for both the projects of the appellant. Permission for construction of shops has been allowed by the local authority in accordance with rules and regulations, keeping in mind presumably the requirement of large townships. However, the projects essentially remained residential housing projects and that is also quite apparent from the certificates issued by the local authority and, therefore neither on the ground of absence of such provision of commercial shops nor on account of such commercial construction having exceeded the area contemplated in the prospective amendment can be ....