TMI Blog2010 (2) TMI 1187X X X X Extracts X X X X X X X X Extracts X X X X ..... te the area occupied by the commercial space was very very negligible - CIT(A) agreed with the view taken AO and took the view, total area of the plot was 4600 sq. metres, the area of 656.75 sq. metres had to be excluded for the D.P. Road and if this is excluded, the size of the plot would be reduced to 3943.25 sq.metres, which is less than one acre (one acre equals 4050 sq. metres). HELD THAT:- On issue of housing project was not entirely residential but was partially commercial, the same is governed by the order Brahma Associates [ 2009 (4) TMI 215 - ITAT PUNE] as held that the margin of 10% can be given for commercial area and so long as the commercial space in the built up area is less than 10% of the total built up area, the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y excluding 656.75 sq.metres from the area of 4600 sq.metres without appreciating that the exclusion is only for the purpose of D.P. Road which does not reduce the size of the plot as a whole. We are therefore satisfied that there is no violation of the conditions prescribed by clause(b). Direct AO to allow the deduction claimed by the assessee u/s 80IB(10) - Decided in favour of assessee. - Rajendra Singh ( Accountant Member) And R. V. Easwar ( Senior Vice President) For the Petitioner : H. S. Raheja For the Respondent : S. B. Morey ORDER R. V. Easwar ( Senior Vice President) This is an appeal by the assessee and it pertains to the assessment year 2004-05. The assessee is a partnership firm engaged in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t in 15 buildings. The total built up area of the project was noticed to be 136475 sq.ft. of which residential area was 134620 sq.ft and commercial construction amounted to 1855 sq.ft.. The Assessing Officer therefore called upon the assessee to explain why the claim for deduction cannot be denied on the ground that the project was not a 100% residential project. The assessee would appear to have submitted that there is no such strict condition prescribed in the section and at any rate the commercial construction amounted only to 1.36% of the total project area of 136475 sq.ft. and there is thus substantial compliance with the condition, if at all there is any, prescribed by the section and at any rate the area occupied by the commercial sp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he same is governed by the order of the Special Bench (Pune) of the Tribunal in the case of Brahma Associates Vs. JCIT., (2009) 119 ITD 255(SB). In this case, it has been held that the margin of 10% can be given for commercial area and so long as the commercial space in the built up area is less than 10% of the total built up area, the claim for deduction under section 80IB(10) cannot be denied. This order supports the assessee s claim that the commercial area of Umiya Complex being only 1.36% of the total built up area, the deduction cannot be refused. Accordingly, we hold that the assessee s claim cannot be refused on this ground namely the ground that the assessee did not satisfy the condition prescribed by clause (c) of section 80IB(1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... q. metres. The CIT(A) has singled out the plot of 4600 sq. metres and has held that if the area of 656.75 sq. metres for D.P. road is excluded, the balance would be only 3943.25 sq. metres, which is less than one acre. In addition to the fact that the assessee itself has treated the entire project as a single project, though it was spread over two plots of land, we find from the annexure to the development agreement that both the plots are contiguous to each other (see drawing at page 54 of the paper book). In the schedule to the development agreement, a copy of which is at page 34 of the paper book dated 23.9.1999, both the survey numbers have been shown as the plot of land which is the subject matter of the development agreement. Thus, bo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etres for road set back. This deduction is thereafter set off by an addition of equivalent area allowed by MNP. The net area of the plot after the deduction of the area for road set back has been shown at 3943.25 sq. metres. Thereafter there is a deduction of 591.49 sq. metres for recreation open space and 411 sq. metres for internal road . The net plot area is then shown at 2940.76 sq. metres. The area of 656.75 sq. metres, which was earlier deducted for road set back, is added and the total area plot is shown at 3597.51 sq. metres. It will be seen that the total plot area has been worked out by the MNP at 3597.51 sq.metres only after deducting 591.49 sq. metres for recreation open space. The recreation open space is however part of the pl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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