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TMI Blog2016 (4) TMI 205X X X X Extracts X X X X X X X X Extracts X X X X ..... lanning authority in respect of the Planning area of Rajarhat pursuant to notification issued under the WB Town and Country (Planning & Development) Act, 1979. For the purpose of Sec.80-IB(10) of the Act it is natural that the authority in charge of planned developed in an area should be the proper authority to sanction plans for housing project keeping in view the need for planned and organized development. We are of the view that the AO misdirected himself in making reference to provisions of Explanation to Sec.10(20) of the Act which defines the term "Local Authority" only for the purpose of the purpose of Clause (20) of Sec.10. For the reasons given above, we confirm the order of the CIT(A) and dismiss the appeal by the Revenue. - Decided in favour of assessee - ITA No. 1413/Kol/2011 - - - Dated:- 3-2-2016 - N. V. Vasudevan, JM And M. Balaganesh, AM For the Appellant : None For the Respondent : Shri S K Tulsiyan, Adv ORDER Per N V Vasudevan, JM This is an appeal by the Revenue directed against the order dated 15.07.2011 of CIT(A)-XII, Kolkata relating to A.Y.2006-07. 2. The grounds of appeal raised by the revenue read as follows :- 1. Whether, o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Provided that nothing contained in clause (a) or clause (b) shall apply to a housing project carried out in accordance with a scheme framed by the Central Government or a State Government for reconstruction or redevelopment of existing buildings in areas declared to be slum areas under any law for the time being in force and such scheme is notified by the Board in this behalf; (b) the project is on the size of a plot of land which has a minimum area of one acre: (c) the residential unit has a maximum built-up area of one thousand square feet where such residential unit is situated within the city of Delhi or Mumbai or within twenty-five kilometres from the municipal limits of these cities and one thousand and five hundred square feet at any other place; (d) the built-up area of the shops and other commercial establishments included in the housing project does not exceed five per cent of the aggregate built-up area of the housing project or two thousand square feet, whichever is less. 4. It can be seen from the provisions of Sec.80-IB(10) that one of the conditions for getting deduction u/s.80-IB(10) of the Act is that housing project should be approved by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 9. In response to the above stand of the AO, the Assessee submitted that in the year 1993, the Kolkata Municipal Development Authority prepared a concept plan that drew the proposal for the New Town. A layout plan was then prepared on the basis of a plane table survey of the acquired land and in accordance with the norms and standards evolved by West Bengal Housing Board for providing a congenial living environment. In 1999, West Bengal Housing Infrastructure Development Corporation Limited was established to oversee the implementation. The Corporation has been given wide powers to develop the entire range of infrastructure services, construct housing and commercial premises, acquire and sell land for different purposes and also to maintain the New Town. Attention was drawn to section 13A of West Bengal Town Country (Planning and Development) Act, 1979 which reads as under: The State Government may, by notification, for such period and on such terms and conditions as may be specified, empower a Planning Authority or a development Authority or any other authority to regulate building operation within the Planning Area, and to impose fees for such purpose, and in such mann ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y fulfilling the condition as laid down in section 801B(10). 11. However, the AO invoked explanation to section 10(20) of the Act for the purpose of ascertaining definition of 'local authority' and by applying the same to section 80IB(10) he denied the deduction claimed by the assessee. 12. Before CIT(A), the Assessee apart from reiterating the stand taken before the AO, further submitted that no specific definition or meaning has been assigned to the expression 'Local authority' in section 80lB(10) of the Act. It was submitted that the expression 'local authority' has nowhere been defined in the Act for the purpose of Sec.10(20) of the Act. A bare perusal of the provisions of section 801B(10) of the Act would make it clear that no reference to explanation to section 10(20) has been made in the section. The situation being so, the reference made by the A O. to section 10(20) in the assessee's case was not proper. It was pointed out that the term Local Authority as defined in Explanation to Sec.10(20) of the Act, is only for the purpose of the said clause and cannot be extended to Sec.80-IB(10) of the Act. It was pointed out that the words 'fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rajarhat. WBHIDCO is the sole authority without the approval of which development' of housing projects in the Rajarhat area cannot take place. In other words, in the assessee's case, for the purpose of section 80IB(10), WBHIDCO is the 'local authority' and approval from the some would be sufficient to entitle the assessee for deduction. It was submitted that the court is to ascribe the natural and ordinary meaning to the words used by the Legislature and the court ought not, under any circumstances, substitute its own impression and ideas in place of the legislative intent as is available from a plain reading of the statutory provisions. By reason of the clarity of expression in section 80IB(10), the question of there being any other local authority, which should also be covered by the explanation to section 10(20), does not arise at all. 15. The CIT(A) agreed with the contentions raised on behalf of the Assessee and he held as follows: After careful consideration of the above submission and assessment order it is noticed that Sec.10(20) defines local authority which is for the specific purpose of that clause which is very evident from plain reading of Sec. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... planation below section 10(20) of the Act and the housing project of the Assessee, it cannot be said that the housing project was approved by local authority and therefore the deduction u/s.80-IB(10) of the Act is not admissible. As rightly contended by the Assessee and held by the CIT(A), the explanation below Sec.10(20) of the Act is only for the purpose of Clause (20) of Sec.10 and this has been made very clear in the said explanation itself. It cannot therefore be extended to the provisions of Sec.80-IB(10) of the Act. WBHIDCO has been appointed as a Planning authority in respect of the Planning area of Rajarhat pursuant to notification issued under the WB Town and Country (Planning Development) Act, 1979. For the purpose of Sec.80-IB(10) of the Act it is natural that the authority in charge of planned developed in an area should be the proper authority to sanction plans for housing project keeping in view the need for planned and organized development. We are of the view that the AO misdirected himself in making reference to provisions of Explanation to Sec.10(20) of the Act which defines the term Local Authority only for the purpose of the purpose of Clause (20) of Sec.10 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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