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2015 (5) TMI 1006 - ITAT AHMEDABAD

2015 (5) TMI 1006 - ITAT AHMEDABAD - TMI - Deduction under section 80IB(10) - CIT(A) allowed the claim - Held that:- CIT(A) has given a finding that the entire risk for development of the project was taken by the assessee and the assessee was not paid remuneration as contractor. The assessee purchased the land for fixed consideration and developed the housing project on its own cost, and there was no joint venture with the land owner. This finding of the CIT(A) has not been controverted by the D .....

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of assessee - ITA No.1868/Ahd/2011 - Dated:- 8-5-2015 - SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI S.S. GODARA, JUDICIAL MEMBER Appellant by : Shri D.C. Mishra, SR.DR Respondent by : None ORDER PER N.S. SAINI, ACCOUNTANT MEMBER: This is an appeal filed by the Revenue against the order of the CIT(A)-I, Ahmedabad dated 13.5.2011. 2. The sole ground of appeal taken by the Revenue is that the CIT(A) erred in directing the AO to allow the assessee s claim for deduction of ₹ 3,61,25,632/- unde .....

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he claim of deduction under section 80IB(10) to the assessee for the following reasons: i) The land is not in the name of the firm. Ownership of land is an essential element which carries with it the right to develop the land and build housing projects thereon. AO says that the developer first should purchase the land and then take necessary permission to construct. (ii) Appellant in the instant case has acted merely as an agent for collection of the land consideration on behalf of the land owne .....

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4.4 I have carefully examined the facts of the case, submissions of the appellant and perused the arguments of the Assessing officer. The AO's arguments are mainly based on two grounds i.e. the land was registered in the name of the society and that the permission for development was in the name of Society. As against this, the appellant has clarified and proved that the development was carried out by them. Even the cost for obtaining permission was borne by the appellant. The appellant had .....

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sociated with housing" project were borne by appellant. It is added that the appellant has not earned remuneration at fixed rate. On the main issue of ownership of land and approval being in the name of landowner for claim of deduction u/s. 80IB (10), it is seen that although, the issue was decided in favor of the appellant and against revenue by the order of the Jurisdictional in the case of Radhe Developers vs ITO ward 3(2) Baroda No 2482/Ahd/2006 A bench Ahmedabad, however the decision w .....

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the land owner. Further, Hon'ble Apex Court in the case of Faqir Chand Gulati vs Uppal Agencies Pvt. Ltd. & Anr. (Civil Appeal No. 3302 of 2005) dated 10/07/2008 has held thati) A development agreement is one where the land holder provides the land. The Builder puts up a building. Thereafter, the land owner and builder share the constructed area. The builder delivers the owner's share to the land holder and retains the builder's share. The land holder sells/transfers undivided s .....

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n of apartments and sale of those apartments so as to share the profits in a particular ratio may be a joint venture, if the agreement discloses an intent that both parties shall exercise joint control over the construction/development and be accountable to each other for their respective acts with reference to the project. 4.5. It is seen that the entire risk is of the appellant who is developing the project and there is no agreement for fixed remuneration as a contractor. In the instant case, .....

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