Non-compliance in respect of hived off part of project does not dis-entitle deduction under Section 80IB(10)

Brief of the case:

ITAT Hyderabad in the case of Smt. Cherkuri vs. DCIT concluded that development of commercial complex by the buyer of plot area even if it is approved by the concerned authorities as the part of the project, could not be said to have been developed by the assessee as a part & parcel of the project.

Facts of the case:

The assessee is engaged in the business of real estate development and claimed deduction of Rs. 3,29,78,844/- u/s Sec 80IB(10) in respect of profit derived from housing project developed by her.

The Assessing Officer during the course of scrutiny assessment proceedings examined the claim and disallowed the deduction by concluding that the assessee violated the three conditions as stipulated u/s 80IB (10).As per the AO , the violated conditions were-

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