Brief of the case:
Tribunal examined that whether AO is right in rejecting the claim u/s 80 IB (10) on facts that assessee is engaged in business of development of housing project without ownership of land. After examining the facts of the case tribunal decided that profit or loss which may result from execution of the project belonged entirely to the assessee. It can thus be seen that the assessee had developed the housing project. The fact that the assessee may not have owned the land would be of no consequence.
Facts of the case:
- The assessee is engaged in the business of developing residential housing projects. During the course of the scrutiny assessment proceedings, the Assessing Officer noticed that the assessee has claimed a deduction of Rs 49,34,922 under section 80 IB (10) of the Act, but the assessee was not owner of the land on which housing project was developed.
- It was noted that assessee was not owner of the land on which the project was developed and the assessee had not acquired the dominant control over the project.
- The Assessing Officer was of the view that since the assessee did not own the land, since the necessary approval of the project was taken by the land owners and since the assessee has merely acted as an agent and as a contractor as it has entered into construction agreement with the landowners.
- The assessee is not eligible for deduction under section 80IB(10) of the Act. Aggrieved, assessee carried the matter in appeal before the CIT(A) but confirmed the assessment order.
Contention of the revenue:
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