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TMI Blog2015 (6) TMI 836X X X X Extracts X X X X X X X X Extracts X X X X ..... Account” a sum of ₹ 92,61,613/- was transferred. Also one of the schedule of the balance sheet to demonstrate that the cost of land was reflected in the account. Learned AR has also informed that the assessee had arranged the finances but simultaneously also received the development charges from the members of the society. There is a difference between a “developer” and a “contractor” which was elaborately explained to learned CIT(A) who has considered those legal aspect in the light of the facts of this case. We have noted that in the case of Radhey Developers, (2011 (12) TMI 248 - GUJARAT HIGH COURT ) the Hon’ble Court has opined that ownership of the property is not the only condition precedent, especially under the circumstances when an agreement is executed to develop a property and the developer has full authority to execute the project but side by side also undertaken the risk as well as the responsibilities. Respectfully following the decision of the Hon’ble High Court in the background of the facts of this case, we hereby uphold the view taken by learned CIT(A) and dismiss the ground of the Revenue. - Decided in favour of assessee. - ITA No.1872/Ahd/2011 - - - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into or Development Agreement with Suraj (Ghodasar) Owners Association on 11.10.2004 As per the terms of the agreement, (i) the assessee was given possession of the land for construction of housing units as per the plan, (ii) the assessee was allowed to enroll prospective buyers as the members on behalf of the Association/society, (iii) the assessee was allowed to collect the consideration for land as well as super-structure from the buyers on, behalf of the Association (iv) the assessee was allowed to retain the consideration received for construction and charge the land cost to the Association. In other words the Association was formed for group housing of the members and was supposed to construct and transfer the houses to the members, (v) According to the Development Agreement, since the Association had no experience of construction, the assessee was allowed to construct the houses on behalf of the Association as per the terms narrated in the agreement according to the approved plan of the Association. 2.1 In short, the AO s objection was that the assessee was not the owner of the land and that the permission was issued in the name of the Chairman of the said Association; ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tage of construction for commercial use. His objection is that the appellant is not the owner of the land. This objection of the AO has to be seen in the light of the tests laid down by Hon'ble ITAT Bench A Ahmedabad decision in the case of M/s.Shakti Corporation, Baroda in ITANo.1503/Ahd/2008 in AY 2005-06 wherein Hon'ble ITAT has held that where the appellant is found having practically purchased the land and has borne the risk of development deduction should be allowed. Here the appellant has been found fulfilling the conditions laid down in section 80IB(10) of the Income Tax Act and has also been found meeting the tests laid down in Hon'ble ITAT Bench A Ahmedabad decision in the case of M/s.Shakti Corporation, Baroda in ITA No.l503/Ahd/2008 in A.Y. 2005-06 as it had practically purchased the land as clear from the P L account where ₹ 92,61,613 has been debited as land cost and cheque payments made to Suraj (Ghodasar) Owners Association from its bank account and it had borne the entire cost and risk of developing the project as clear from Clause 15A of the Development Agreement, which clearly states that the profit was to be of the appellant, therefore in my ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome of the clauses of the agreement which were highlighted before us were as under: 3. All plans, elevations, sections and drawings of erections and premises to be created as a part of development of the said property have been approved by the Ahmedabad Municipal Corporation Authority and the specification/s of the construction and all the building materials to be used therein shall be decided/arranged by the Developer/Builder at its own cost and expenses and the development of the said property shall be made strictly in accordance with the plans duly sanctioned by the said authority and subject to the law for the time being in force. 4. The Developer/Builder shall be entitled to develop the said property either alone or jointly with other or others or through any contractor as the Developer/Builder may deem fit and proper. However, for all purposes of the NTC, the Developer/Builder alone shall be responsible for all and every acts done for the development of the said property . 7. For the purpose of this Agreement and for the development of the said property, the Developer/Builder shall be entitled to engage its cost and expenses, architects, engineers, supervisors con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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