TaxTMI 
TaxTMI 
2011 (8) TMI 1294
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....nces of the case and in law, the Ld. CIT (A) erred in directing the Assessing Officer to allow the deduction to the assessee on the ground that the assessee has purchased the land for a fixed consideration from the landowner and has developed the house project at its own cost and risks involved, in respect of issue regarding deduction u/s. 80-IB(10) r.w.s. 80IB(1) claimed by the assessee, without appreciating the fact that the approval by the local authority as well as completion certificate was not granted to the assessee but to the land owner and the rights and obligation under the said approval were not transferable, and that transfer of dwelling units in favour of the end-users was made by the landowner and not by the assessee. ....
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....s to prospective buyers, the profit booked from sale of 35364.19 sq. mt. was stated to be outside the ambit of provisions of section 80IB (10) as it is not the profit derived from activities of development and construction. In essence deduction u/s. 80IB (10) was denied and in the alternate the deduction on sale of unutilized FSI was disallowed. 5. By impugned order the CIT (A) allowed both grounds in favour of the assessee by following the decision of Co-ordinate Bench in the case of Radhe Developers and others. After going through this decision, we find that similar issue came up before the Hon'ble ITAT, Ahmedabad, in ITA No.2482/AHD/2006 in the case of M/s. Radhe Developers and others in which appellant was also one of the party. The ....
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....ion would be eligible to the person who is developing and building housing project and not to the mere owner thereof. 29. It is also the case of the Revenue that the assessee was a mere contractor developing and building housing project and therefore, it could not be a developer. We fail to understand as to how such a situation could emerge. A person who enters into a contract with another person is no doubt a contractor. Having entered into agreements with landowners for development and building the housing project, was obviously a contractor but it does not derogate the assessee for being a developer, as well. The term contractor is not essentially contradictory to the term developer. As stated above it is the undertaking that de....
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....t; there is no question of selling unused FSI to the individual buyer for each project and also there is no question of calculating the profitability on FSI as the same has not been contemplated u/s. 80IB (10) OF THE Act. On verification of the sale deed executed in favour of buyers of the residential houses, it is clear that the assessee had made this sale deed for sale of plot of land. Further, on verification of development agreement with the land owner, we find that here also the reference is with respect to land area only. In both the documents assessee had not acquired rights and has not relinquished rights with reference to FSI. Further, on verification of approved map for each unit is with reference to built up area only. Under the ....
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....ng all the risks involved therein. We may mention here that, in our opinion, the decision in the case of Radhe Developers (supra) will not apply in a case where the assessee has entered into the agreement for a fixed remuneration merely as a contractor to construct or develop the housing project on behalf of the landowner. The agreement entered into in that case will not entitle the developer to have the dominant control over the project and all the risks involved therein will vest with the landowner only. The interest of the Developer will be restricted only for the fixed remuneration for which he would be rendering the services. The decision in the case of Radhe Developers (supra) has not dealt with such situation. The proposition of law ....