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2014 (7) TMI 592 - AT - Income TaxAllowability of deduction u/s 80IB of the Act on pro rata basis – Held that:- The assessee has fulfilled the conditions relating to minimum area of plot size, the commencing and completion of the project and the maximum built-up area in respect of residential units - The only condition which the assessee has failed to fulfill is with respect to the maximum limit of commercial area in a housing project i.e., 2000 sq. ft.- In housing project under consideration, the area allocated for commercial purpose is 3906 sq. ft. – the area marked as commercial area, is in fact a common area to be used as crèche by the residents of the housing project - The area is not for the benefit of general public but for the exclusive use of the flat owners alone – the decision in Commissioner of Income Tax Chennai Versus M/s. Arun Excello Foundations Pvt. Ltd [2012 (12) TMI 415 - MADRAS HIGH COURT] followed - where there is a partial compliance, deduction u/s.80IB(10) is allowable on pro-rata basis where both commercial and residential houses have been built – thus, the CIT(A) is justified in granting proportionate relief to the assessee - CIT(Appeals) rightly held that the assessee is entitled to deduction u/s 80IB on the entire project except the profit element in respect of area of 1906 sq. ft., which exceeds the maximum statutory limit of 2000 sq. ft., that could be used for commercial purpose u/s.80IB(10) – Decided against Revenue.
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