TMI Blog2016 (9) TMI 764X X X X Extracts X X X X X X X X Extracts X X X X ..... only after such scrutiny, the Assessing Officer in the order of assessment, made no disallowance on the assessee's claim of deduction under section 80IB(10) of the Act, except for limiting it to the extent of profit. Thus, the entire claim of deduction came up for consideration at the hands of the Assessing Officer in the original assessment. The claim was minutely examined and only thereafter accepted. It would therefore not be permissible to the Assessing Officer to disturb such claim in exercise of powers under section 147 of the Act that by issuing the notice beyond the period of four years beyond the period of relevant assessment year. Here again, the Assessing Officer had not recorded, in what manner the assessee failed in its duty to disclose truly and fully all material facts. In fact, the thirst of the contention of the Assessing Officer appears to be that the assessee had not developed housing project, but was acting as a contractor. In this respect, the Assessing Officer has placed reliance on the retrospective explanation added to section 80IB(10) of the Act. It is well settled by the series of judgments of this Court that retrospective amendment in statute would no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ₹ 1,71,566/-and the claim of the assessee company for deduction u/s. 80IB(10) of the Act of ₹ 10,12,56,034/-was fully granted. The book profit of the assessee company was computed at ₹ 9,91,52,822/-and since the income determined u/s. 115IB of the Act was higher than the assessed income, tax was calculated on the book profit determined u/s. 115IB of the Act. As per Explanation inserted below Section 80IB( 10) by the Finance Act (No.2), Act, 2009 with retrospective effect from 01.04.2000 deduction u/s. 80IB(10) shall not be admissible to a contractor in respect of works contract awarded by any person. For the sake of clarity, same is reproduced hereunder :- Explanation For the removal of doubts, it is hereby declared that nothing contained in this subsection shall apply to any undertaking which executes the housing project as a works contract awarded by any person including the Central or State Government. In this case, perusal of records revealed that (i) During the year, the assessee had constructed housing projects called Maniratnam I II and has shown net profit of ₹ 10,12,56,034/-( ₹ 4,05,03,151 + ₹ 6,07,52,883/-respec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atnam I bears the owner of the land as the society, i.e. Dhaneshwar Par CoOp. Society Ltd. and the developer as Ganesh Housing Corporation Ltd. (assessee). However, in respect of ManiratnamII, the assessee's name had not been mentioned as developer. It categorically states that the permission for construction is granted subject to various rules and bye laws laid down by the Gujarat Town Planning and Urban Development Act, 1976. In view of the above, it has become quite clear that in the Development Permission issued by AMC in respect of ManiratnamII Project, the assessee's name was not even mentioned as Developer. Further, the construction permission/Raja Chity issued by AMC in respect of ManiratnamII also does not mentioned the name of the assessee as a developer. There was failure on the part of the assessee to disregard these facts in Form No.10CCB while claiming deduction u/s.80IB(1) of the Act. The Assessing Officer in the assessment proceedings u/s. 143(3) did not give any opinion regarding the allowability or otherwise of deduction u/s. 80IB(10) of the Act. If an issue has not been examined in correct perspective in the initial assessment proceedings, nothing p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be made at appropriate stage. 7. On the other hand, counsel for the Revenue opposed the petition contending that certain vital aspects were not disclosed by the assessee in the return and during the scrutiny assessment. The deduction of tax at source by the societies would indicate that the assessee was acting as a contractor and not as a developer. This aspect was not examined during the original assessment. 8. For multiple reasons, the notice for reopening cannot be sustained. Our reasons for this conclusion are as follows. 9. In the original assessment, the Assessing Officer had occasion to examine the petitioner's claim for deduction under section 80IB(10) of the Act. In fact, this was the principle claim of the assessee, since bulk of its income was derived from housing projects, with respect to which, the assessee had claimed deduction under section 80IB(10) of the Act. The Assessing Officer raised multiple queries under a letter dated 03.08.2006, one of them calling upon the assessee to substantiate the claim under section 80IB(10) of the Act, amounting to ₹ 10.12 crores alongwith necessary documentary evidence. In reply to such query, the assessee unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... manner the assessee failed in its duty to disclose truly and fully all material facts. In fact, the thirst of the contention of the Assessing Officer appears to be that the assessee had not developed housing project, but was acting as a contractor. In this respect, the Assessing Officer has placed reliance on the retrospective explanation added to section 80IB(10) of the Act. It is well settled by the series of judgments of this Court that retrospective amendment in statute would not enable the Assessing Officer to reopen an assessment beyond a period of four years. 11. The stand of the Assessing Officer that in one of the projects in the development permission, the name of the assessee was not mentioned as a developer. The petitioner has explained this in the objections raised to the reasons recorded by pointing out that after development of PhaseI of the project, when permission was granted for PhaseII, the same was done in computerized format, which did not contain an entry for showing of the name of the developer. Quite apart from this explanation, on this ground, it would not be open for the Assessing Officer to reexamine the claim, which was originally accepted after scrut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of Section 80IB nor any other provisions contained in other related statutes were brought to our notice to demonstrate that ownership of the land would be a condition precedent for developing the housing project. It was perhaps not even the case of the Revenue that under the other laws governing construction in urban and semiurban areas, there was any such restriction. It is, however, the thrust of the argument of the Revenue that in order to receive benefit under Section 80IB(10) of the Act, such requirement must be read into the statute. We cannot accept such a contention. Firstly, as already noted, there is nothing under Section 80IB (10) of the Act requiring that ownership of the land must vest in the developer to be able to qualify for such deduction. Secondly, term developer has been understood in common parlance as well as in legal sense carrying a much wider connotation. The Tribunal itself in the impugned order has traced different meanings of term developer explained in different dictionaries, which read as under:- a. The Webster's Encyclopedia unabridged of the English Language gives Following meaning of the term ' developer ' as: ..... X X X X Extracts X X X X X X X X Extracts X X X X
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