TaxTMI 
TaxTMI 
2016 (7) TMI 381
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....he case, as culled out from the assessment records are as under:- 2.1. Assessee is an individual, who filed his return of income for AY 2006-07 on 31/10/2006 showing the total income of Rs. 50,86,470/-, after claiming deduction of Rs. 97,38,816/- u/s.80IB of the Act. Thereafter, assessee filed revised return of income on 02/01/2007 declaring total income of Rs. 50,86,470/-. The case was selected for scrutiny and thereafter assessment was framed u/s.143(3) of the I.T.Act, 1961 vide order dated 29/12/2008 and the total income was determined at Rs. 1,48,25,286/- by disallowing the claim of deduction u/s.80IB(10) of the Act. Aggrieved by the order of Assessing Officer (AO), assessee carried the matter before the ld.CIT(A), who vide order dat....
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....n which construction activities was carried out was not owned by the assessee and the necessary permission from the appropriate authorities was also not obtained by the assessee but the approval of the local authorities was granted to S/Shri Ambalal T.Patel and Gordhanbhai Nathabhai Patel, land owners. AO was therefore of the view that the assessee was not a Developer but was a mere Contractor and therefore was not eligible for deduction u/s.80IB(10) of the Act. He accordingly, denied the claim of deduction. Aggrieved by the order of AO, assessee carried the matter before the ld.CIT(A), who after considering the submissions of the assessee, allowed the claim of the assessee by holding as under:- "8. For claiming deduction u/s.80IB(10) fi....
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....ition is not under dispute. d) The built up area of the shops and other commercial establishments included in the housing project does not exceed 5% of the aggregate built up area or 2000 sq.ft. whichever is less: Thus the conditions specified in section 80IB(10) mentioned above stand fulfilled by the appellant. 9. Now to come to the legal controversy whether 80-IB(10) can be denied to an assessee on the logic taken by the AO that he is not the owner of the land then how can he be a developer, his status is just that of a contractor. This point has to be examined in the light of the decision dated 7.11.2008 given by Hon'ble ITAT Bench A Ahmedabad in the case of M/s.Shakti Corporation, Baroda in ITA No.1503/Ahd/2008 in AY 200-06.....
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....we are of the view that the assessee will be entitled for the deduction u/s.80IB(10). The decision of the Hon'ble Supreme Court in the case of Faquir Chand Gulati (supra) will not assist the Revenue, as the agreement is not sharing of the constructed area. In other cases the copy of agreement since has not been submitted before us. If submitted the terms and conditions of the agreement were not specifically argued before and placed before us, we therefore in the interest of justice and fair play to both the parties set aside the order of the CIT(A) ad restore all other appeals to the file of the AO with the direction that the AO shall look into the agreement entered into by each of the assessees with the land owner and decide whether the as....
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.... the Housing Project shall be under the control and management for the Developer only) 6.9. (the Developer shall hold the said land and developments thereon till the scope and purpose of the housing projects are duly achieved and all amounts to be recovered from the members of the project are received.) 7.1. (the Developer shall arrange the entire finance for the project in addition to the amounts that may be received from the prospective members) 9.1 (which says that the profit or loss that may arise out of the project will belong to the Developer). 10.3. (all residential units till they are disposed of shall remain under the possession of the Developer) As the appellant fulfills the conditions laid down for claiming deducti....
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....see was not the owner of the land and the permission for the construction was not obtained by the assessee and the risk and reward of the project was not of the assessee. We find that the ld.CIT(A) after considering the submissions of the assessee and after perusing the Development Agreement has given a finding that the assessee has practically purchased the land and bore the entire cost and risk for developing the project, had invested in the cost of land and had acquired dominant control over the land. She has further given a finding that the assessee has fulfilled all the required conditions laid down u/s.80IB(10) of the Act for claiming the deduction in the light of the decision of Tribunal in the case of M/s.Shakti Corporation(supra). ....