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TMI Blog2011 (4) TMI 642X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of profits derived from such housing projects cannot be denied to the assessee particularly when the assessee is not eligible for exemption and is merely acting as a contractor and further deleting the disallowance in a summary and non-speaking manner especially when the pre-requisite condition of section 80-IB(10) of the Act were not fulfilled by the assessee and further allowing the deduction under section 80-IB when the assessee has not sold any constructed property to its customers and all the sums received from customers are treated as construction receipts and the registry of the land was only made in the name of the society, therefore, the deduction is against the letter and spirit of legal provisions. 2. During hearing, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see constructed the houses and sold to the buyers. The stand of the assessee is that the assessee is a builder and development of housing project, therefore, eligible for deduction under section 80-IB(10) of the Act. However, the learned Assessing Officer denied such claim of Rs. 24,15,305. The main reason for making disallowance under section 80-IB(10) was that the assessee was not the owner of the land and the registry was also not in the name of the assessee. The approval was also not obtained in the name of the assessee. The stand of the assessee is that there is no requirement under section 80-IB(10) that the land on which such houses are constructed/built must be in the name of the assessee or the approval should be obtained in the na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approval in respect of the housing project is obtained more than once, such housing project shall be deemed to have been approved on the date on which the building plan of such housing project is first approved by the local authority; (ii) the date of completion of construction of the housing project shall be taken to be the date on which the completion certificate in respect of such housing project is issued by the local authority; (b) the project is on the size of a plot of land which has a minimum area of one acre: Provided that nothing contained in clause (a) or clause (b) shall apply to a housing project carried out in accordance with a scheme framed by the Central G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y person representing such individual, the spouse or the minor children of such individual or the Hindu undivided family in which such individual is the karta. Explanation.-For the removal of doubts, it is hereby declared that nothing contained in this sub-section shall apply to any undertaking which executes the housing project as a works contract awarded by any person (including the Central or State Government)." However, the Assessing Officer found that the conditions stipulated under section 80-IB of the Act have not been fulfilled by the assessee. He, accordingly, declined the claim of the assessee under section 80-IB of the Act. By the impugned order, the learned Commissioner of Income-tax (Appeals) allowed the assessee's claim afte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oes not own the land, the benefit of deduction to the extent of 100 per cent of the profits derived by the activity of developing and building a housing project, available under section 80-IB(10), cannot be denied to the appellant. In view of the above, the Assessing Officer is directed to allow the deduction claimed by the appellant under section 80-IB(10) of the Income-tax Act, 1961 and in the process this ground of appeal is allowed." From record, we find that the Assessing Officer has declined the claim of deduction under section 80-IB(10) of the Act by observing that the assessee has not developed this project. The main condition for grant of exemption under section 80-IB(10) of the Act is that the assessee should work as a developer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er or merely a contractor. We, therefore, set aside the order of the learned Commissioner of Income-tax (Appeals) on the issue of allowability of deduction under section 80-IB of the Act and the matter is restored to the file of the Assessing Officer for deciding afresh after asking the assessee to produce completion certificate of the project which should be prior to 31-3-2008 by the local authority. The Assessing Officer is also directed to examine the agreement which appears to be produced before the ld. first appellate authority for the first time giving details of scope of the work to be undertaken by the assessee. The Assessing Officer is also required to verify whether the assessee has actually undertaken all the jobs which are requi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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