2018 (1) TMI 196

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....ellate Tribunal, New Delhi. The moot question of law arising in this appeal is:- "Whether on the facts and circumstances of the case, the ITAT was legally correct in allowing deduction (s) under Section 80 I A (5) and 80 I B (10) of the Income Tax Act, 1961 when it was clearly established that the constructions of the projects started before 1.10.1998." The respondent assessee is a company engaged in building and construction activities. It undertook construction of two major complexes namely M/S Shipra Rivera and M/S Shipra Sun City at Indirapuram. Each of the above complexes were sub-divided into small projects. The Shipra Rivera complex was divided into the following six projects:- 1) Bhagirathi Project; ....

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....ng project is admissible subject to fulfilment of the following three conditions:- 1) Required land area under which project is more than one acer; 2) Built up area of housing is not more than 1000 sq. feet; and 3) The development and construction of the housing project commences on or after 1.10.1998 and is completed before 1.4.2004. In the case at hand there is no dispute with regard to satisfaction of the first two conditions rather the dispute is only with regard to commencement of the development and construction of the project prior to 1.10.1998. The tribunal in allowing the claim of the assessee has held that as in all the four projects work orders were issued subsequent to 1.10.1998, there is no reas....

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.... so as to develop the land to facilitate the construction of a building over it, the development and construction of the housing project commences with such levelling of the earth. Therefore when the expression used is "Commences Development and Construction of the Housing Project" the intention of the legislature is clear that the development of the project and the construction which follows such development must start on or before the date specified even if either the development or the construction starts before the specified date, the benefit under the aforesaid provisions would not be admissible. The evidence on record may prove that the foundation laying ceremony of the projects may have been performed on 30.9.1998 and actual const....