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TMI Blog2015 (8) TMI 1160X X X X Extracts X X X X X X X X Extracts X X X X ..... DABAD] to hold that the amount was the receipt from developing and building of housing project in the name and style of ‘Ornate House’ which was eligible for deduction u/s 80IB(10) - Decided in favour of assessee. - ITA No. 2966/Ahd/2014 - - - Dated:- 7-8-2015 - SHRI G.D. AGRAWAL AND SHRI KUL BHARAT, JJ. For The Assessee : Shri Mehul Shah, AR For The Revenue : Shri Narendra Singh, Sr. DR ORDER PER G.D. AGRAWAL, VICE PRESIDENT: This appeal by the assessee is directed against the order of the learned Commissioner of Income-tax (Appeals)-I, Surat dated 28.08.2014 for Assessment Year 2010-11. 2. The first ground of the assessee s appeal reads as under:- 1. On the facts and in circumstances of the case as well as law on the subject, the learned CIT(A) has erred in passing ex-parte order without giving proper opportunity of being heard. 3. At the time of hearing before us, the ld. Counsel for the assessee did not press this ground of appeal; accordingly the same is rejected as not pressed. 4. The ground No.2 of the assessee s appeal reads as under:- 2. On the facts and circumstances of the case as well as law on the subject, the learned Commissi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee s housing project was eligible for deduction u/s 80IB(10). However, he was of the opinion that the sum of ₹ 76,25,000/- was not the income from the housing project. During the course of assessment proceedings, the Assessing Officer asked for the details of the flat owners who made the payment of on-money. The assessee did not have any other details except that was recorded in the diary found during the course of survey and seized by the Revenue. During the course of survey, the survey team held that in the said diary the assessee has recorded the details of onmoney received for booking of flat. The assessee accepted the view of the survey team and offered the same as its income. That, the assessee did not have any other business activity except the one housing project which was eligible for deduction u/s 80IB(10). The Assessing Officer accepted the assessee s statement given during the course of survey for the purpose of taxing the sum of ₹ 76,25,000/-, but he did not accept the said statement for the purpose of considering deduction u/s 80IB(10). He stated that identical issue is considered by the ITAT, Ahmedabad Bench in the case of M/s. Nilkanth Developers v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere a housing project has been, or, is approved by the local authority on or after the 1st day of April, 2004 but not later than the 31st day of March, 2005, within four years from the end of the financial year in which the housing project is approved by the local authority; (iii) in a case where a housing project has been approved by the local authority on or after the 1st day of April, 2005, within five years from the end of the financial year in which the housing project is approved by the local authority. Explanation.-For the purposes of this clause,- (i) in a case where the 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of flat was properly recorded in the regular books of accounts or not. In view of above, we are unable to agree with the view of the CIT(A) that the deduction u/s 80IB(10) would be allowed only in respect of the profit which is worked out as per receipt recorded in the regular books of accounts found at the time of survey and not in respect of the on-money which was found recorded in a diary. In our opinion, the deduction u/s 80IB(10) is to be allowed on the 100% of the profit derived from the housing project. 11. Now, the question is whether the sum of ₹ 76,25,000/- is the profit derived from the housing project. Admittedly, during the accounting year relevant to assessment year under consideration the only business activity of the assessee-firm was the housing project which is eligible for deduction u/s 80IB(10). During the course of survey, one diary named as Valentinel was found which was marked as Annexure BF-5. On page Nos. 2-9 of the diary, there were receipts of certain amounts. As per Revenue authorities who conducted the survey such noting in the diary was for receipt of onmoney from housing project. This would be clear from question No.11 put by the officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e authorities themselves have considered the receipt noted in the diary to be on-money received for booking of the flats in Ornate House. The assessee admitted the same and surrendered the sum of ₹ 76,25,000/- as its income from Ornate House project. Admittedly, the assessee did not have any other business activity during the year under consideration. Considering the totality of these facts and the arguments of both the sides, in our opinion, there was no justification for the Assessing Officer to hold that the sum of ₹ 76,25,000/- was the income from other sources and not the income from Ornate House project. We find that similar issue is considered by the ITAT, Ahmedabad Bench in the case of M/s. Nilkanth Developers vide ITA No.2610/Ahd/2014, wherein the ITAT after considering the factual and legal position in detail held as under:- 13. In the instant case, we find that it is not in dispute that the only business of the assessee was of developing and building of housing project styled Nilkanth Heights Project . No material has been brought before us to show that the assessee was engaged in any other activity. Further, during the course of survey, the assessee has ..... X X X X Extracts X X X X X X X X Extracts X X X X
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