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2016 (7) TMI 818 - ITAT AHMEDABAD

2016 (7) TMI 818 - ITAT AHMEDABAD - TMI - Disallowance u/s 80IB(10) - treatment to assessee as developer - Held that:- A bare reading of the agreement would suggest that the assessee had borne the risk and also entitled for the reward. Clause-4 of the agreement duly authorizes the assessee to register individuals, firms or companies as a member of the Society and determine the price for unit registered for them. The emphasis of the ld.AO towards clause-9 of the agreement is concerned, it contemp .....

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the light of the above agreement, then, it would reveal that the CIT(A) has rightly treated the assessee as developer and rightly allowed the deduction under section 80IB(10) of the Income Tax Act - Decided in favour of assessee. - ITA No.1428 and 1429/Ahd/2012 - Dated:- 11-7-2016 - SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER For The Revenue : Shri Jamesh Kurian, Sr.DR For The Assessee : Ira R. Kapoor, AR ORDER PER RAJPAL YADAV, JUDICIAL MEMBER: The present two ap .....

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ars. 3. With the assistance of the ld.representative, we have gone through the record carefully. It emerges from the record that this dispute earlier travelled to the Tribunal vide ITA No.3686/Ahd/2007 and 2371/Ahd/2008 for the Asstt.Years 2004-05 and 2005-06. The Tribunal has decided both the appeals vide order dated 1.2.2011. The Tribunal has set aside the issue to the file of the AO for re-adjudication. The relevant part of the Tribunal s order reads as under: "Since both the parties agr .....

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d undertaking by the assessee and other relevant documents, keeping in view the aforesaid decisions of the ITAT as also after, allowing sufficient opportunity to the assessee and thereafter, decide as to whether the undertaking of the assessee has indeed purchased the land for a fixed consideration from the landowner and Las developed the housing project at its own cost and risks involved in the project. In the event the AO finds that the land had been purchased by the undertaking of the assesse .....

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O had issued notice on 3.11.2011, and thereafter passed assessment order on 30.12.2011. The assessee has submitted various details. The AO reproduced them in the assessment order and some of the figures reproduced at page no.11 and 12 of the assessment are totally illegible. The AO did not make any elaborate analysis of the details as per the directions of the Tribunal, rather, arrived at some conclusion which had arrived in the original assessment orders. His stand is that as per clause-9 of th .....

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correctness of the conclusions drawn by the ld.CIT(A), it is pertinent to take note of the development agreement reproduced by the ld.CIT(A) which reads as under: 1. The party of second part (assessee) will be totally responsible for the development of property to be constructed at T.P.ANo.5, P.P.No.29/30, Village - Umra belonging to party of the first part and the party of the second part will be known as developers of the said project. 2. The party of second part will have to construct accordi .....

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cond part in the interest of party of the party of the first part will be final. While taking decisions, interest of the party of the first part should be kept. 3. The party of second part shall collect contribution for construction, land and other expenses from (he members of the society to meet financial requirement. They will be also able to borrow funds on interest from outside parties, financial institutions, banks and for that they will be able to sign any promissory note, receipts, hundi, .....

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of project, the party of the second part will be able to determine the terms and condition according to its will. The party of the second part will be able to take necessary action and cancelled the registration of the members who fail to fulfill the terms and conditions. In such case, the party of the second part also able to forfeit the contribution paid by any of the member. They will also be able to re-register the said flat and allot the same to any other person. 5. ..... 6. ..... 7. By th .....

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s agreement, the party of the second part will be totally responsible for any act done by it as builder, organizer or developer. During the course of continuation of project, if due to breach any rules and regulation of municipality, State or Central Government, any additional liability arises in respect of municipality, police department, Income-tax, Sales-tax, and Consumer Act than the party of the second part will be responsible and party of the first part or its members shall not be responsi .....

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he party of the second part for the development and construction of residential units on the land belonging to the party of the first part for its members, it will get remuneration @ 15% on the contribution collected. In short, if party of the second part collects ₹ 100/- as contribution from members of the society, it will get ₹ 15 as remuneration. In this manner, ₹ 115/- collected from the members will include remuneration as developers amounting to ₹ 15/-. At the end o .....

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