2011 (7) TMI 1280 - AT - Income Tax

Summary

Issues Involved:
Validity of revisional order passed u/s. 263 of the Act regarding the entitlement to claim deduction u/s. 80IB(10) for profits from a housing project.

Summary:
The assessee claimed deduction u/s. 80 IB (10) for a housing project named "Pate Sanskruti." The Assessing Officer (A.O) allowed the claim, but the Commissioner of Income Tax (CIT) held that the project did not meet the conditions for the deduction due to the plot size being below the prescribed limit. The CIT issued a show cause notice u/s. 263, directing the A.O to re-compute the income. The assessee appealed, arguing that all necessary details were provided during assessment, and the A.O had applied his mind. The A.O had asked for and received information on the plot size, and the CBDT Circular No. 5 of 2005 was cited to support the inclusion of road areas in plot calculations. The Tribunal found that the A.O had rightly allowed the deduction, considering the evidence presented and relevant legal precedents. The CIT's decision to invoke u/s. 263 was deemed unjustified, and the revisional order was set aside, restoring the assessment order in favor of the assessee.

Conclusion:
The Tribunal allowed the appeal, pronouncing the order on 8th July 2011.