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TMI Blog2014 (1) TMI 914X X X X Extracts X X X X X X X X Extracts X X X X ..... aring on the asset side of balance sheet - payment to the land lord is not an essential condition for granting deduction u/s 80IB of the Act - There is no such mention in the Act that entire construction of the land should be paid to the land lord. The decision in Income-tax Officer, Ward-2(5), Ahmedabad Versus Shakti Corporation [2008 (11) TMI 436 - ITAT AHMEDABAD] followed - The land owners were entitled to a fixed consideration of Rs. 11 per square feet and the housing project was to be developed by the assessee at his own cost and risk - Assessee had full control over development of land and sale of tenements - CIT(A) has rightly allowed the deduction u/s 80IB(10) of the Act to the assessee – Decided against Revenue. - ITA No. 605/A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all the conditions required in the light of the decision in the case of M/s Shakti Corporation. The assessee also submitted that as per development agreement the land owners were entitled to a fixed amount of Rs. 11 per square feet. It was also submitted that the assessee had appointed the contractor and other agencies for execution of work. It had appointed architect to get the plan prepared and got it approved from the local authorities. It was also submitted that assessee was entitled to enroll members, to receive money from them, to issue receipts to them and to give necessary documents and other certificates for obtaining loans. As per development agreement the assessee was entitled to develop the land and it had to bear all expenses f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d and to put up any scheme for development of the said land. (ii) To construct the houses as per the scheme and the entire expenditure for the same shall be incurred by the developer. (iii) To appoint architect for the execution of the scheme. It is also provided in the said clause that it is the responsibility of the developer to determine and to pay the fees of architect. (iv) To appoint contractors for execution of work and to make contracts with them. (v) To prepare the plans for approval and to get it approved from the local authority. (vi) To enroll the members of the scheme, to receive money from them to issue receipts to them and for that purpose to enter into the development agreement. The said clause also specifies that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oted that your appellant has to appoint contractor and other agencies for execution of work. It has to appoint architect and get the plan prepared them and get it approved from the local authority. The developers were also entitled to enroll the members to receive money from them to issue receipt from them and to give necessary documents and other certificates to members to obtaining loans. In going through the said development agreement, it is seen that the developer was entitled to develop the said land and for that he has to bare all expenses for construction and obtaining other permission etc. During the course of reassessment proceeding the learned AO has asked to justify the claim of your appellant in light of the order in case of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tractor and other agencies for execution of work. it has to appoint architect and get the plan prepare from them and get it approved for the local authority. The developers are also entitled to enroll the members to receive money from them to issue receipts from them and to give necessary documents and other certificates to members to obtaining loans. On going through the said development agreement, it is seen that the developer is entitled to develop the said land and for that he has to bare all" expenses for construction and for obtaining other permission etc. From the development agreement it is seen that the land lord is entitled to the cost of land and not the profit earn by the developer. As regards the AO's plea that your appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aced reliance on the order of Ld. CIT(A). 9. After hearing Ld. D.R. and perusing the record, we find that Ld. CIT(A) after going through the copy of the development agreement filed by the assessee before him found that land owners were entitled to a fixed consideration of Rs. 11 per square feet and the housing project was to be developed by the assessee at his own cost and risk. Assessee had full control over development of land and sale of tenements. Since on these facts ratio of decision in the case of M/s Shakti Corporation is fully applicable, Ld. CIT(A) has rightly allowed the deduction u/s 80IB(10) of the Act to the assessee, therefore we feel no need to interfere with the order passed by him and the same is hereby upheld. 10. In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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