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TMI Blog2017 (5) TMI 1420X X X X Extracts X X X X X X X X Extracts X X X X ..... e Ld CIT(A) was right in law and facts in allowing the claim of the assessee for deduction u/s 80IB(10) of the I.T. Act, 1961 of Rs. 1,60,88,554/- holding that the assessee is a developer u/s.80IB(10), without appreciating that the assessee was not the owner of the land on which the project was constructed and approval by the local authority was not granted to the assessee but to the land owner. The land owner directly sold pieces of land to the Unit Holders. The assessee entered into a separate agreement with the plot owners for construction of houses." 3. The short reason for which deduction under section 80IB(10) has been declined to the assessee is that the assessee did not own the land on which the housing project, by the name of 'Na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ollowing the views expressed by Hon'ble jurisdictional High Court, in assessee's own case and in respect of the same project, when no distinguishing factors have been pointed out. No such points of distinctions were pointed to us either. In any event, the views expressed by the coordinate bench, in the case of Shri Umeya Corporation Vs Income Tax Officer (ITA Ni. 211/Ahd/2010; order dated 7th July 2015), summing up the views of Hon'ble jurisdictional High Court on this issue, are as follows: 6. We find that, in the case of CIT Vs Radhe Developers [(2012) 341 ITR 403 (Guj)], Hon'ble jurisdictional High Court had an occasion to consider the issue of ownership of land, on which housing project is developed, in the context of eligibility of de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rlining, supplied by us) 7. In our humble understanding, therefore, in order to answer the question as to whether the condition precedent for deduction under section 80IB has been satisfied inasmuch as whether or not the assessee is engaged in "developing and building housing projects", all that is material is whether assessee is taking the entrepreneurship risk in execution of such project. When profits or losses, as a result of execution of project as such, belong predominantly to the assessee, the assessee is obviously taking the entrepreneurship risk qua the project and is, accordingly, eligible for deduction under section 80IB(10) in respect of the same. The assumption of such an entrepreneurship risk is not dependent on ownership of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Third Member. So in view of above discussion, following the ratio of jurisdictional High Court in case of ABG Heavy Industries Ltd. (supra), the Assessing Officer is directed to allow deduction u/s.80IA(4) of the Act to the assessee with regard to the projects in question for both the years. 9. It is not even the case of the Assessing Officer that the assessee did not assume the entrepreneurship risks of the housing project. The format of arrangements for transfer of built up unit, and business model of the assessee for that purpose, is not decisive factor for determining eligibility of deduction under section 80 IB (10), but that is all that the authorities below have found fault with. The objections of the authorities below are thus ..... X X X X Extracts X X X X X X X X Extracts X X X X
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