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2014 (8) TMI 42 - GUJARAT HIGH COURTDeduction u/s 80IB(10) r.w. section 80IB(1) – Profits derived from sale of unutilized FSI – Profits eligible for deduction or not and the profits not derived from the business activity of development and construction of a housing project – Held that:- The profit relatable to the sale of unutilized FSI would not be eligible for deduction under sec. 80IB(10) of the Act - Following the decision in The Commissioner of Income Tax-I Versus Moon Star Developers [2014 (4) TMI 1042 - GUJARAT HIGH COURT] - marginal underutilization of FSI certainly cannot be a ground for rejecting the claim u/s 80IB(10) of the Act - Even if there has been considerable under-utilization, if the assessee can point out any special grounds why the FSI could not be fully utilized, the case may stand on a different footing - in cases where the utilization of FSI is way short of the permissible area of construction, looking to the scheme of section 80IB(10) of the Act and the purpose of granting deduction on the income from development of housing projects envisaged, bifurcation of profits arising out of such activity and that arising out of the net sell of FSI must be resorted to - none of the assessees have made any special ground for non-utilization of the FSI - The finding recorded by the AO is on appreciation of evidence and it has never been disputed by the assessee - when the factual aspect with respect to the total permissible FSI available for construction; the FSI utilized by the assessee and the FSI unutilized by the assessee is available on record, there is no question to remand the matter to the AO – Decided in favour of Revenue.
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