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2014 (10) TMI 930 - AT - Income TaxDisallowance of deduction u/s.80IA and sec.80IB - AO disallowed the claim of the assessee on the ground that the assessee is not a developer of the project and merely worked as a contractor - Held that:- In these appeals, we note that the project was duly approved by the competent authority, therefore, condition No.(i) is fulfilled, likewise the condition contained in (ii) is also fulfilled and similar is the position with respect to condition as contained in (iii). So far as, condition contained in sub clause (b) is concerned the size of the plot is also within the prescribed limit of more than one acres and the development of the project was carried out in accordance with the scheme framed by the government. So far as built up area condition is concerned this is also within the specified limit, meaning thereby all the conditions as stipulated in this section are complied with by the assessee. The totality of facts are clearly indicative to the conclusion, as discussed earlier also, that the assessee is not a work contractor, rather, it developed the project in every respect right from soil-testing, earth filling, designing, planning, sewerage, drainage, and till the final completion of the project. It is worth quoting that as per condition No. (iii) the flats were to be maintained till they are handed over to the Engineer in Charge. Hon'ble Jurisdictional High Court in the case of ABG Heavy Industries Ltd. (2010 (2) TMI 108 - BOMBAY HIGH COURT) decided the similar case in favour of the assessee treating him to be a developer. The expression "development" has not been artificially defined for the purposes of sec.80IA/80IB of the Act, therefore, it should receive its ordinary and natural meaning. The Parliament in its wisdom amended the provisions of sec.80IA/80IB of the Act so as to clarify that in order to avail a deduction the assessee should (i) develop or (ii) operate and maintain or (iii) develop, operate and maintain the facility. Parliament eventually stepped into to clarify that it was not invariably necessary for a developer to operate and maintain the facility So far as, the contention of the Revenue that the assessee is not the owner of the project. We note that the section nowhere put a condition that for claiming deduction under these sections necessarily the assessee has to be the owner of the project. This is not the intention of the legislature otherwise nothing prevented it to include such clause at the time of legislating/inacting the provision. If the contention of the ld. DR is accepted then whole purpose of inacting such provision and consequent development of infrastructure will be defeated. - Decided in favour of assessee.
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