TMI Blog2014 (9) TMI 653X X X X Extracts X X X X X X X X Extracts X X X X ..... ion or redevelopment of slum area - the intent of legislation is to exempt the condition of minimum of 1 acre plot size in the case where the housing project is carried out in accordance with the slum reconstruction scheme framed by the Central Government or State Government and such scheme is notified by the board. The projects are carried out in accordance with the scheme for redevelopment of the slum area as framed by the State Government of Maharashtra and the same has been notified by the board vide notification dated 5th January 2011 - once the scheme is notified all projects carried out in accordance with such scheme are entitled for the benefit of the proviso whereby the conditions prescribed under clause (a) & (b) are relaxed - the second part of the notification is inconsistent/contrary to the proviso of clause (a) & (b) of section 80IB(10) as well as to the intent of the legislature inserting the said proviso - The Board cannot insert a new condition in the provisions of a statute which is repugnant to the provisions itself as well as against the very object and scheme of the said provision of the statute - the proviso to clause (a) & (b) of section 80IB(10) mandates ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s than 1 acre and, therefore, when the assessee has developed the housing project on three separate plots though under the one city survey no. then the area of all these plots should be taken together as it falls under the same survey no. The AO did not accept the contention of the assessee and accordingly disallowed the claim of the assessee. 3. On appeal, apart from merging all the plots, the assessee has also contended that the slum rehabilitation scheme has been notified by the board vide notification dated 5th January 2011, therefore, the condition of minimum area of 1 acre of land is not applicable in the case of the assessee. The CIT(A) noted that under the notification dated 5.1.2011 the slum redevelopment scheme of the Government of Maharashtra has been notified subject to the condition that the projects approved before 01.4.2004 do not fall under the scheme notified by the CBDT. 4. Before us, the Ld. AR of the assessee has submitted that the housing projects have been developed by the assessee under the scheme of slum rehabilitation authority for the purpose of rehabilitation of slum dwellers. These projects have been approved by the authority as per the separate re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der said scheme. He has further submitted that by introduction of the proviso in the section, rigours of the conditions has been relaxed to achieve the socio economic object of providing the concession of deduction u/s 80IB(10). Thus the Ld. AR has submitted that the provision should be interpreted liberally. In support of his contention he has relied upon the following decision; (i) CIT v. Suresh N. Gupta [2008] 297 ITR 322 (ii) Bajaj Tempo Ltd. v. CIT [1992] 196 ITR 188 (iii) 326 ITR 254 (Guj) (sic) and submitted that while interpreting the statute the purpose of clause should be applied. 5. On the other hand Ld. DR has submitted that as far as the merging of three plots are concerned this issue has been considered by this Tribunal in assessee's own case for assessment years 2003-04 to 2005-06 and further for the A.Y. 2006-07. He has further submitted that the decision in the case of Vandana Properties (supra) relied upon by the assessee is not applicable in the facts of the case of the assessee because the provision of section 80IB(10) does not permit the merger of plot and three different projects, when each project stand alone basis is not eligible for dedu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he development carried out by him in different areas and aggregate the same so as to claim benefits of deduction u/s. 80IB(10) of the Act. Intention behind the provisions of Section 80IB(10) was not to allow developers to have benefit of such aggregation. We are therefore of the view that learned CIT(A) fell into an error in holding that the assessee was entitled to benefits of section 80IB(10) of the Act. In our view, Assessing Officer was right in rejecting the claim of the assessee. We, therefore, reverse the orders of Ld. CIT(A) and restore the order of the Assessing Officer. 6.1 We further note that for the A.Y. 2006-07 in ITA No. 6448/Mum/2008, the Tribunal by following the earlier order of this Tribunal has decided this issue vide order dated 16th September 2009 in para 3 as under: 3. The Ld. Departmental Representative filed copy of the order dated 9th September 2009, (ITA Nos. 5955/M/06, 2616/M/07 and 3912/M/08) to submit that the three plots were located at different places and hence the assessee has not fulfilled the conditions laid down under section 80IB(10) of the Act so as to avail the benefit of deduction under section 80IB(10) of the Act. Consistent w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -section (10) of section 80IB from the Assessment Year 2005-06 onwards. 7.1 As per this notification the board in para 2 has stated that this notification shall be deemed to apply to the projects approved by the local authority under the SRS scheme on or after 01st April 2004 and before 31st March 2008. It was further clarified that the income arising from such projects eligible for deduction u/s 80IB(10) from the A.Y. 2004-05 onwards. The question arises whether while notifying the scheme the board can attach any condition for the eligibility of the project to avail the benefit of the proviso to section 80IB(10) (a) (b). At this stage we quote the relevant part of section 80IB(10) as under: (a) Such undertaking has commenced or commences development and construction of the housing project on or after the 01st day of October, 1998 and completes such construction: (i) in a case where a housing project has been approved by the local authority before the 01st day of April, 2004, on or before the 31st day of March, 2008; (ii) in a case where a housing project has been, or is approved by the local authority on or after the 01st day of April, 20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... escribed under the said clauses is that the housing project is carried out in accordance with the scheme for reconstruction or redevelopment of slum area. Such scheme either framed by State Government or Central Government and notified by the board in this behalf. The plain reading of the proviso inserted by the Finance Act, 2004 to clause (a) (b) of sub-section (10) of section 80IB clearly manifest the requirement of notification of the scheme so framed either by the Central Government or by the State Government. Therefore, there is no requirement of notification of an individual project under the scheme. It is relevant to see the intent of the legislature while amending the provisions of section 80IB(10), to relax the condition for such project under the slum rehabilitation scheme. The memorandum explaining the provisions in the Finance Bill 2004 states that; with a view to increase the redevelopment of slum dwellers it has proposed to relax the condition of minimum plot size of 1 acre in case of housing project carried out in accordance with the scheme framed by the Central Government or State Government for reconstruction or redevelopment of existing building and notified by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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