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Issues Involved:
1. Admissibility of deduction under section 80IB(10) of the Income-tax Act, 1961. 2. Compliance with conditions stipulated under section 80IB(10). 3. Ownership of land and its relevance to the deduction. 4. Interpretation of "developer" versus "contractor". 5. Application of legal precedents and interpretations. Detailed Analysis: 1. Admissibility of Deduction under Section 80IB(10): The core issue in the appeal was whether the assessee was entitled to a deduction under section 80IB(10) of the Income-tax Act, 1961. The Revenue contended that the CIT(A) erred in allowing the deduction as the assessee was not granted approval by the local authority to carry on the business of developing and building housing projects. The Tribunal noted that the CIT(A) had allowed the deduction following the decision of the ITAT in the case of M/s Radhe Developers & Others. However, the Tribunal emphasized that the statute provides for the deduction and exemption of income along with certain conditions that must be complied with by the assessee. 2. Compliance with Conditions Stipulated under Section 80IB(10): The Tribunal highlighted that section 80IB(10) requires compliance with specific conditions, including the completion of the housing project within the stipulated time frame. The Revenue argued that the project was not completed as per the conditions laid down under section 80IB(10), as only 130 out of 456 units had received completion certificates by the deadline. The Tribunal agreed that all conditions under section 80IB(10), including the completion of the project, must be met for the deduction to be admissible. 3. Ownership of Land and Its Relevance to the Deduction: The Revenue argued that the assessee could not pass on full title over dwelling units to customers without owning the land component. The Tribunal referred to the decision in the case of M/s Radhe Developers, where it was held that the deduction is available to the person developing and building the housing project, irrespective of land ownership. The Tribunal emphasized that the agreement must be scrutinized to determine whether the assessee had acquired dominant control over the land and developed the project at its own cost and risk. 4. Interpretation of "Developer" versus "Contractor": The Tribunal discussed the distinction between a "developer" and a "contractor." It noted that the term "contractor" is not essentially contradictory to "developer." A person who enters into a contract to develop and build a housing project can still be considered a developer if they have dominant control over the project and undertake all associated risks. The Tribunal reiterated that the deduction under section 80IB(10) is available to the undertaking developing and building the housing project, regardless of whether it is the landowner or a contractor. 5. Application of Legal Precedents and Interpretations: The Tribunal referred to several legal precedents, including the decision in the case of Faqir Chand Gulati and the Supreme Court's interpretation of "ownership" in the context of section 32 of the Income-tax Act. It emphasized that the interpretation of statutes should be based on the plain and explicit language of the provisions. The Tribunal concluded that the decision in the case of M/s Radhe Developers would not apply universally without examining the specific terms of the development agreement. Conclusion: The Tribunal set aside the order of the CIT(A) and restored the issue to the file of the Assessing Officer (AO). The AO was directed to re-examine the development agreement and determine whether the assessee had dominant control over the land and developed the housing project at its own cost and risk. If the AO finds that the assessee acted merely as a contractor for a fixed remuneration, the deduction under section 80IB(10) should not be allowed. The AO was also instructed to verify compliance with the condition regarding the completion of the housing project by the stipulated date. The appeal was allowed for statistical purposes.
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