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2012 (11) TMI 508 - AT - Income TaxDeduction u/s 80IB - disallowance as built up area of the project did not have the approval of the local authority - CIT(A) allowed the claim - Held that:- Refering to the clarification of the CBDT in a letter vide F.No.205/3/2001/ITA-II dt.4.5.2001 addressed to the Maharashtra Chamber of Housing Industry in which it has been stated that approval of any project as a housing project by the local authority would be adequate for the purposes of section 80IB of the Act. Although, the learned Departmental Representative has contended that aforesaid clarifications were given in the context of the commercial areas being constructed along with the housing project, it is viewed that the scope cannot be considered to be restricted to that circumstance alone. This is due to the fact that the definition of a housing project is not given under the Act and therefore the view of the CBDT that a housing project is one which is approved by a local authority requires to be given full effect to. Therefore, it cannot be construed that what the assessee has constructed is not a housing project. CIT(A) has rightly placed reliance on the decisions of Petron Engineering Construction Private Limited And Another Versus CBDT And Others [1988 (12) TMI 1 - SUPREME COURT] to arrive at the view that the tax incentive by way of deduction 80IB is predominantly for the purpose of augmenting affordable dwelling and ought to be interpreted in that light. The fact that the assessee has obtained approval for the housing project cannot be lost sight of. As for the excess area constructed it is for the BBMP to look into the violations if any in the construction of the housing project. That however does not authorize the AO to hold that the assessee has not got approval for the housing project OR that the conditions laid down in section 80IB (10) stated violated - in favour of assessee.
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