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2014 (12) TMI 1373 - AT - Income TaxDeduction u/s 80IB(10) - project was constructed was less than 1 acre - Claim denied on profits derived from the housing project 'Ved Vihar' - CIT(A) held that the area of the plot on which the said project was constructed was less than 1 acre and hence, the deduction u/s 80IB(10) was not allowable to the assessee in respect of the said project - HELD THAT:- Assessee had bought the TDR rights and had been sanctioned to construct 12 additional flats in the existing building Nos.A and B of the said project and where it had already completed the originally sanctioned 80 flats within the stipulated period, the assessee was eligible to the claim of deduction under section 80IB(10) of the Act. The assessee had constructed 80 flats originally sanctioned by the commencement certificate dated 21.05.2004 before 31.03.2009 and the PMC had issued occupancy certificate on 30.03.2009 for the said 80 flats in building Nos.A and B. The assessee thus, was entitled to the claim of deduction under section 80IB(10) of the Act in respect of the said 80 flats in building Nos.A and B which were completed within the stipulated period as provided under section 80IB(10)(b) of the Act, for which an occupancy certificate was also issued by the local authority. Merely because the assessee had received the sanction for the construction of 12 additional flats in the same building itself against the purchase of TDR rights, which admittedly, was not constructed before 31.03.2009 does not dis-entitle the assessee to the claim of deduction under section 80IB(10) of the Act in respect of the originally sanctioned 80 flats. The provisions of section 80IB(10) of the Act are benevolent and have to be interpreted in the manner which is beneficial to the assessee. The assessee admittedly, has not claimed any deduction in respect of balance 12 flats which were not constructed before 31.03.2009. In the entirety of the above facts and circumstances, we hold that the assessee is entitled to the claim of deduction under section 80IB(10) of the Act on the completion of the project which comprised of construction of 80 flats, which was originally sanctioned vide commencement certificate dated 21.05.2004 against which, the occupancy certificate dated 30.03.2009 has been issued. Under the provisions of section 80IB(10)(a) of the Act, the assessee had to complete the construction on or before 31.03.2009 and the assessee having been issued the occupancy certificate dated 30.03.2009 had also complied with the said provisions of the said Act and was entitled to the claim of deduction under section 80IB(10) of the Act, subject to fulfillment of the basic condition that the plot area of the project was one acre or more. We have also remitted the said issue of measurement of the plot back to the file of Assessing Officer and in case, it is established that the assessee has fulfilled the said condition, wherein area of the plot on which the project has been constructed is one acre or more, then the assessee would be entitled to the claim of deduction under section 80IB(10) of the Act. Assessee's alternate plea as to allowance of proportionate deduction on account of the flats constructed, is not maintainable in either case, where the claim of the assessee under section 80IB(10) of the Act has been found to be maintainable. However, if the assessee fails to justify the basic condition of the area of plot being one acre or more, even the alternate plea of the assessee is not maintainable. Grounds of appeal raised by the assessee are thus, allowed as indicated above.
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