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TMI Blog2016 (5) TMI 1268X X X X Extracts X X X X X X X X Extracts X X X X ..... inion that all these activities would constitute an activity of construction, the Tribunal ought to have first disallowed the findings recorded by CIT (Appeals) that the actual date of commencement of construction was 15.10.1998. But, unfortunately, the Tribunal agreed in paragraph 14 of its order that the actual date of commencement of construction was 15.10.1998. However, the Tribunal held that all pre-construction activities should be taken to be part of development, so as to pre-pone the date of development and construction. This, in our considered view, is not the correct interpretation to be offered to the composite expression "development and construction"of the housing project. - Decided in favour of assessee - Tax Case Appeal No.9 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truction have taken place prior to 01.10.1998? (5) Whether on the facts and in the circumstances of the case the interpretation given by the Income Tax Appellate Tribunal to the expression 'development and construction' contained in section 80 IB of the Income Tax Act is correct and whether the Tribunal is right in law in concluding that the development and construction has taken place before 01.10.1998? 2. Heard Dr.Anita Sumanth, learned counsel for the appellant and Mr.T.Ravi Kumar, learned Standing Counsel for the Revenue. 3. The assessee filed a return of income for the assessment year 2001-02 on 30.10.2001 admitting a particular amount of total income. The case was selected for scrutiny and a notice under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the timeline of events as follows: 5.6. In the background of the above discussion, it is to be examined whether the appellant fulfills the conditions enumerated u/s.80IB(10) or not. For the sake of convenience the various events which have been taken place in chronological order are enumerated below:- (i) Signing of agreement for purchase of land with owners 25.09.1993 (ii) Digging of Borewell 19.10.1996 (iii) Construction of compound wall 14.09.1996 (iv) Appointment of Architect along with initial advance 07.01.1997 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ondition. The Assessing Officer had also not disputed this fact. Therefore, the only issue to be decided is whether or not the appellant commenced development of the project before 1.10.98. In case, the appellant commenced the development of the project before 1.10.98, the appellant would not be entitled for deduction u/s.80IB(10). In case, it is found that the appellant commenced the development of the project after 1.10.98, the appellant would be entitled for deduction u/s.80IB(10) since the appellant would then be fulfilling all the conditions. Therefore, essentially it boils down to finding out at what point of time, the appellant can be said to have commenced the development of the project . As stated earlier, for development ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The date of completion is not of relevance to the case on hand as the focus in this case is only on the date of commencement of development and construction of the housing project. 10. From paragraph 5.6 of the order of the CIT (Appeals), which we have extracted above, it is seen that the Commissioner (Appeals) recorded a finding of fact to the effect that the commencement of construction at site was on 15.10.1998. The CIT (Appeals) went one step further in paragraph 5.6 of his order pointing out that the Assessing Officer had not disputed the said fact. What was disputed by the Assessing Officer before the CIT (Appeals) was whether the assessee had commenced development of the project before 01.10.1998 or not. 11. In other words, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t speaks both about development and construction of the housing project. The conjunction between development and construction, by the use of the word and , cannot be made a dead letter, by applying the definition of the expression development to the phrase development and construction . Development cannot be the same as development and construction. This twin requirement under 80IB(10) has been omitted to be taken note of. 15. From the finding recorded by the Tribunal in paragraphs 8 to 10 of its order, it is clear that certain expenses incurred by the assessee in removing the hut dwellers, digging of bore well, getting electricity connection, putting up compound walls and security cabins, etc. have all been taken by the Tribunal to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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