9911796707
TMI Blog2015 (11) TMI 1208X X X X Extracts X X X X X X X X Extracts X X X X ..... ant, so the same is not tenable in the eye of law. The appellant requests that leave be granted to add, alter or amend any of the grounds of appeal on or before the final hearing of the appeal. 2. Briefly stated the facts of the case are that the assessee is a partnership firm carrying out business of construction and development of land for housing project(s). It filed its return of income on 31.08.2005 declaring total income of Rs. 36,890/- for AY 2005-06, along with audit report in form No.10CCB claiming deduction u/s 80IB(10) of the Act. The case was selected for scrutiny assessment under CASS. Notice u/s 143(2) was served upon the assessee and assessment proceeding was initiated. AO framed the assessment order by disallowing the claim of deduction of Rs. 18,07,624/- made by assessee u/s 80IB(10) of the Act. Aggrieved, assessee went in appeal before the CIT(A), who confirmed the disallowance made by AO giving following observation in the appellate order :- "5.5 This clearly shows that the receipts the appellant is entitled is fixed at the inception of the project and the risks which rise during the construction of the project as a result of the price escalation or the prices ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssment proceedings, appellant had furnished all the details called for by the ld. AO including agreement of construction and development. The ld. AO has verified the books of account vouchers, bills etc. completely. 7) That the ld. AO had not accepted the claim of appellant on the ground as indicated in para no.5 of assessment order and determined the appellant's total income at Rs. 18,07,624/- by making following addition in the returned income. It is in this backdrop of fact, appellant respectfully submit as under :- The ld. AO has grossly erred on facts and in law in rejecting the appellant's claim of deduction of Rs. 18,07,624/- where the requisite conditions have been fully satisfied, hence the same may please be deleted. So far as the three conditions stipulate in the said provision have been fulfilled by the appellant and accepted by the ld. AO. * That the appellant entered into agreement with society for carrying out the development and construction works as per approved plan by AUDA. * The society land area is more then 1 acre (1040 sq.mts) * The appellant had been carrying out the development and construction activity since December, 1999. The appellant has been en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of deduction under section 80IB(10) in relation to profit from housing projects constructed by the assessee. The order passed by the co-ordinate Bench in ITA Nos.1191,1192 & 1193/Ahd/2011 dated 9.6.2014 is the latest order which has also discussed the order passed by the co-ordinate Bench in ITA Nos.1086 & 1087/Ahd/2007 for AYs 2002-03 & 2003-04, dated 11.3.2008. Relevant portion of the order dated 9.6.2014 passed by the co-ordinate Bench reads as below :- "6. We find that the Tribunal in Assessment Year 2002-03 and 2003- 04 vide order dated 11.03.2008 has held as under: "6. The CIT(A) considering these facts in 2002-03 assessment year took specific note of the fact that the view taken in 2000-01 assessment year is the latest in point of time by the CIT(A) since the order dated 27.1.2006 whereas the issue in 2001-02 assessment year was decided by his predecessor on 11.2004.Accordingly, taking into consideration these facts he was of the view that the facts and circumstances as taken into consideration by his predecessor in 2000-01 assessment year in his order dated 27.1.2006 needs to be followed. Being also of the view that the deduction u/s 80IB(10) which has been claimed i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been that of a full fledged contractor/builder in housing project. The development charges were fixed @ 23% of housing project which is in the guise of net income from the housing scheme. The appellant is involved from the beginning i.e. from the time of land purchase to the last step of completion of housing project These facts show that the appellant has actually carried out the work of construction. I agree with the contentions of the Authorised Representative that in a normal course of construction business, for erecting the building as per plan, the society has to entrust such very difficult task to experienced contractor/developer, as the members of society do not have any knowledge or expertise in construction and development work and for effective and timely completion of scheme such society engaged reliable and experienced developer/contractor and labour contractor; by an agreement by stipulating certain conditions. Thus the society in this case has entrusted the construction and labour work to the appellant firm as per the terms and conditions laid down in the development and labour agreement. In a normal course of construction business, the society has to bear the expens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the Tribunal in the case of Radhe Developers which has consistently been followed by the Ahmedabad Bench in the case of contractors who have been held to be entitled to deduction u/s 80IB which has been denied solely on the ground that the land was not owned by the developer. The activity of the development has been carried on by the contractor-developer as per the agreement entered into with the land owners which carried on the developmental activity in terms of the agreement. Simply because the land was not owned by the developers it has consistently been held is not a relevant criteria to disallow the deduction claimed not only in the case of Radhe Developers but also has been consistently followed by the Ahmedabad Benches. We find no merit in the departmental appeal in the light of the above facts and circumstances and position of law. Thus, since the facts and circumstances remain identical and no distinguishing fact despite specific opportunities could be pointed out by the Department, respectfully following the order of the Ahmedabad Bench, we dismiss the departmental appeal." 8. In the result, appeal in ITA No. 1086/ Ahd / 2007 by the Department is dismissed." ..... X X X X Extracts X X X X X X X X Extracts X X X X
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