Deduction u/s 80IB(10) for an undertaking developing and ...

Deduction for housing projects approved before 31st March allowed based on approved plans, excluding built-up area concept retrospectively.

Case Laws     Income Tax

July 25, 2024

Deduction u/s 80IB(10) for an undertaking developing and building housing projects approved before March 31 by a local authority. The scope of the definition of 'built-up area' was examined. The DVO's report showing violation related to two row houses having an area more than 1500 sq.ft. was not considered. It was held that for projects approved prior to April 1, 2005, the assessee could legitimately claim deduction u/s 80IB(10) based on the plans approved by the Planning Authority, as the concept of built-up area, including inner measurement, projections, balconies, and wall thickness, but excluding common areas, was not applicable. Applying such parameters retrospectively would lead to absurd results. The expression 'built-up area' introduced from April 1, 2005, cannot be applied retrospectively, and the Tribunal was justified in excluding the balcony area for the period up to April 1, 2005. The decision was in favor of the assessee.

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