Case Law Details
Sai Teja Constructions Vs DCIT (ITAT Hyderabad)
ITAT Hyderabad held that deduction u/s. 80IB(10) of the Income Tax Act is applicable to an undertaking developing and building housing projects. The same is not applicable to a partner in a joint venture/partnership firm.
Facts-
The assessee is a partnership firm engaged in the business of investment and construction of residential flats. It filed its return of income for A.Y. 2008-09 belatedly declaring total income of Rs. Nil. The assessee firm is a partner of M/s. SMR SAI TEJA ESTATES which is in the business of construction of residential flats.
According to the Assessing Officer, in view of the provisions of section 45(3), the investment by the assessee in the firm SMR Sai Teja Estates has to be treated as capital asset and gain arised thereupon has to be treated as capital gain. He therefore, asked the assessee to explain as to why the investment in the firm SMR Sai Teja Estates should not be treated as capital asset and gain arised thereupon should not be treated as capital gain u/s 45(3) of the I.T. Act.
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