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Commissioner of Income Tax, Ghaziabad Versus M/s Shipra Estate Ltd.

2018 (1) TMI 196 - ALLAHABAD HIGH COURT

Deduction u/s 80IA (5) and 80IB (10) - clearly established that the constructions of the projects started before 1.10.1998 - Held that:- Where the assessee undertakes levelling work so as to develop the land to facilitate the construction of a building over it, the development and construction of the housing project commences with such levelling of the earth. Therefore when the expression used is "Commences Development and Construction of the Housing Project" the intention of the legislature is .....

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n the project had started much earlier. Thus, with the levelling of the earth, the development and construction of the project had commenced which was prior to 1st October 1998. - In view of the fact that the development and construction of the housing project are integral to each other and as the filling or levelling of the earth of the projects which is part of development had commenced prior to 1.10.1998, it would be deemed that the development and construction had commenced prior to 1.10 .....

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ar,Manu Ghildyal For the Respondent : Swapnil Kumar,Trapti Gupta ORDER Heard Sri Manu Ghildyal, learned counsel for the revenue and Sri Swapnil Kumar assisted by Ms. Tripti Gupta for the assessee respondent. These are three connected appeals preferred by the Commissioner of Income Tax, Ghaziabad against the common order dated 30th October 2009 passed by the Income Tax Appellate Tribunal, New Delhi. The moot question of law arising in this appeal is:- "Whether on the facts and circumstances .....

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ects. The Shipra Rivera complex was divided into the following six projects:- 1) Bhagirathi Project; 2) Alaknanda Project; 3) Brahmaputra Project; 4) Caveri Project; 5) Amravati Project; and 6) Damodar Project. Similarly, Shipra Sun City Complex was also sub-divided into five projects namely:- 1) Nilgiri Project; 2) Shivalik Project; 3) Sadpura Project; 4) Kanchenjunga Project; and 5) Aravali Project. The respondent assessee claimed deduction under Section 80 IA(4F) read with Section 80 IA(5) an .....

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n October 1998. The claim was disallowed by the Assessing Authority inter alia on one of the grounds that the development and construction work had commenced prior to 1.10.1998. However, the tribunal by the impugned order has accepted the claim. Therefore, the revenue has preferred these appeals. The provision of Section 80 IA (4F) read with Section 80 IA(5) and 80 IB (10) of the Act clearly demonstrates that exemption in respect of profit derived from the housing project is admissible subject t .....

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ject prior to 1.10.1998. The tribunal in allowing the claim of the assessee has held that as in all the four projects work orders were issued subsequent to 1.10.1998, there is no reason to assume that the development and construction of the projects started prior to 1.10.1998 so as to deny the claim of deduction under Section 80 IA (4 F)/80 IB (10) of the Act. Section 80 IA (4F) of the Act which stood during the relevant assessment year reads as under :- " 80IA(4F) This section applies to a .....

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s proviso uses the expression "Commences Development and Construction of the Housing Project" on or after first day of October 1998. A plain and simple reading of the aforesaid provision reveals that the benefit under the aforesaid provision would be available if the undertaking Commences Development and Construction of the Housing Project on or before 1st October 1998. The use of the words "Commences Development and Construction" are material and relevant. The development of .....

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