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TMI Blog2016 (1) TMI 348X X X X Extracts X X X X X X X X Extracts X X X X ..... all cost and was liable for any risk or consequences. The assessee was also authorized to dispose of the sale of bungalow as per his own risk. The aforementioned observation of ld. CIT(A) is not contradicted by the Revenue by placing any contrary material on record. Hence it can be inferred from the facts placed before us that all risk and consequences were borne by the assessee. Under these facts the Assessing Officer was not justified in treating the assessee as merely a contractor. Law is well settled now by the judgment of Hon'ble Jurisdictional High Court in the case of CIT vs. Radhe Developers [2011 (12) TMI 248 - GUJARAT HIGH COURT]., that even if the developer of a project is not owner of the land but he bears all risk and conse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arded the contract by the land owner. The entire responsibility to execute the housing project and abide by the terms and conditions of its approval right from the inception of the project till its completion rests with the land owner. Assessee was just a contractor of the land constructing housing scheme. 3). On the facts and in the circumstances of the case, the Ld. Commissioner of Income-tax (A)-XV, Ahmedabad ought to have upheld the order of the Assessing Officer. ' 4). it is therefore, prayed that the order of the Id. Commissioner of Incometax( A)-XV, Ahmedabad may be set-aside and that of the Assessing Officer be restored. 2. Briefly stated facts are that the case of the assessee was picked up for scrutiny assessmen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is neither a land owner nor a developer he is merely a contractor who had executed the project of construction under a developer agreement. He submitted that as per agreement, the person who carries out the construction as a work contractor is not eligible for the deduction u/s.80IB(10) of the Act. He submitted that the ld. CIT(A) was not justified in deleting the disallowance. On the contrary, ld. Counsel for the assessee, Shri S. N. Divetia argued that there is no misplace. He submitted that Contractor does not invest his own money, but undisputedly land in question was purchased by the money of assessee. Hence the assessee invested his money. He submitted that the entire cost and risk involved into the project was borne by the assessee. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4. As per the Amendment to section 80IB by the Finance Act 2009, a works contractor who executes the work awarded by any person is not eligible for the deduction u/s 80IB. 2.24 Thus, the assessee has failed to satisfy the conditions of section 80IB(10). Therefore, no deduction under this section is allowed. Penalty proceedings u/s 271(1)(c) are initiated for furnishing inaccurate particulars of income. 2.24 Thus, the assessee has failed to satisfy the conditions of section 80IB(10). Therefore, no deduction under this section is allowed. Penalty proceedings u/s 271(1)(c) are initiated for furnishing inaccurate particulars of income. However, ld. CIT(A) allowed the claim of assessee by observing as under: 4. During the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Prafulbhai Shambubhai Patel 3. Rajendrabhai Haribhai Jogani (the first party) land Laljibhai Haribhia Sudani (the second party). Clause 1 states that the possession of the property had been handed over to the first party. Clause 2 states that all material required for carrying out development would be brought by the first party. Clause 3 states that all the expenses would be borne by the first party. Clause 10 states that the first party can sell the said bunglow to any person. After going through rival submissions I am of the view that the appellant should be allowed SOIB(10) deduction because it fulfills the tests laid down by Hon'ble ITAT decision in the case of Shakti Corporation. It has practically purchased the land and de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the fact that the entire amount has been demonstrated by the assessee. The possession of the land was given to the assessee. The assessee incurred all cost and was liable for any risk or consequences. The assessee was also authorized to dispose of the sale of bungalow as per his own risk. The aforementioned observation of ld. CIT(A) is not contradicted by the Revenue by placing any contrary material on record. Hence it can be inferred from the facts placed before us that all risk and consequences were borne by the assessee. Under these facts the Assessing Officer was not justified in treating the assessee as merely a contractor. Law is well settled now by the judgment of Hon'ble Jurisdictional High Court in the case of CIT vs. Radhe De ..... X X X X Extracts X X X X X X X X Extracts X X X X
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