M/s. Shreerang Developers, Baroda V. The Income tax Officer,Ward-5(3), Baroda

ITA 44/AHD/2013

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 80281 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 year(s) 7 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2014
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: C
• Next Hearing Date: 08-08-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 04-01-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: DK MISHR A
• Keywords: Gift
• Section: 143(3); 80IB; 6; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD C BENCH BEFORE: SRI G.C. GUPTA, VICE PRESIDENT AND SHRI ANIL CHATURVEDI, ACCOUNTAN T MEMBER SHREERANG DEVELOPERS, 407, ASHWAMEGH COMPLEX, OPP. SAYAJI VIHAR CLUB, NEAR KHANDERAO MARKET, BARODA-390001 PAN: AARFS0151R (APPELLANT) VS THE INCOME TAX OFFICERS, WARD 5(3), BARODA (RESPONDENT) REVENUE BY: SRI D.K. MISHRA, SR. D.R. ASSESSEE BY: SRI MUKUND BAKSHI, A.R. DATE OF HEARING : 08-08-2014 DATE OF PRONOUNCEMENT : 27-08-20 14 / ORDER PER : ANIL CHATURVEDI, ACCOUNTANT MEMBER:- THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE O RDER OF LD. CIT(A)- V BARODA DATED 26-10-2012 FOR A.Y. 2007-08. ITA NO. 44/AHD/2013 ASSESSMENT YEAR 2007-08 I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 2 2. THE FACTS AS CULLED OUT FROM THE MATERIAL ON REC ORD ARE AS UNDER. 3 THE ASSESSEE IS A PARTNERSHIP FIRM STATED TO BE E NGAGED IN THE BUSINESS OF BUILDING CONSTRUCTION. ASSESSEE ELECTR ONICALLY FILED ITS RETURN OF INCOME FOR A.Y. 2007-08 ON 14-11-2007 DECLARING TOT AL INCOME AT RS. NIL AFTER CLAIMING DEDUCTION OF RS. 1,31,273/- U/S. 80I B(10) OF THE ACT. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER THE A SSESSMENT WAS FRAMED U/S. 143(3) VIDE ORDER DATED 31-12-2009 AND THE TOT AL INCOME WAS DETERMINED AT RS. 12,43,770/-. AGGRIEVED BY THE OR DER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A). LD. CIT(A) V IDE ORDER DATED 26.10.2012 GRANTED PARTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE AFORESAID ORDER OF LD. CIT(A), ASSESSEE IS NOW IN A PPEAL BEFORE US AND HAS RAISED THE FOLLOWING GROUNDS:- 1. THE LD.CIT (A)-V, BARODA HAS ERRED IN LAW AND IN FACTS HOLDING THAT THE APPELLANT IS NOT A BUILDER AND DEVELOPER, WHO IS NOT ASSUMING THE ENTREPRENEURIAL RISK AND THAT THE BUSI NESS UNDERTAKEN BY IT IS IN THE NATURE OF A WORKS CONTRACTOR. 2. THE LD. CIT (A)- V, BARODA HAS ERRED IN LAW AN D IN FACTS HOLDING THAT APPELLANT, THOUGH DEVELOPING AND BUILDING RESI DENTIAL HOUSES CANNOT BE SAID TO HAVE FULFILLED THE CONDITIONS FOR THE CLAIM OF DEDUCTION U/S 80IB(10) AS IN SALE OF THE HOUSES, TH E APPELLANT HAS EXECUTED THE SALE DEED OF THE INCOMPLETE HOUSE AND THAT THE EXECUTION OF CONSTRUCTION AGREEMENT FOR CONSTRUCTIO N OF THE INCOMPLETE HOUSE WOULD RENDER THE APPELLANT INELIGI BLE FOR THE CLAIM OF DEDUCTION U/S 80IB(10) AND THAT SUCH ACT WOULD TANTAMOUNT TO UNDERTAKING THE BUSINESS AS A WORKS CONTRACTOR AND THAT THE PROFIT FROM SUCH BUSINESS IS INELIGIBLE FOR THE CLAIM OF T HE DEDUCTION U/S 80IB(10). 3. THE LD. CLT(A)-V, BARODA HAS ERRED IN LAW AND IN FACTS IN DENYING TO THE APPELLANT THE CLAIM OF DEDUCTION U/S 80IB(10) AMOUNTING TO RS. 8,03,273 DESPITE THE APPELLANT HAV ING FULFILLED ALL THE CONDITIONS FOR SUCH CLAIM INCLUDING THAT OF THE DEVELOPMENT AND I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 3 BUILDING OF HOUSING PROJECTS. THE APPELLANT MAY PLE ASE BE ALLOWED THE CLAIM AS MADE. 4. THE LD. CIT(A)-V, BARODA HAS ERRED IN LAW AND IN FACTS IN CONFIRMING THE ACTION OF THE LD. ASSESSING OFFICER IN CONFIRMING DISALLOWANCE TO THE EXTENT OF RS.1,500/- U/S 40(A)( IA) OF THE ACT ON THE GROUND THAT TDS HAS NOT BEEN DEDUCTED ON PAYMEN TS MADE ON ACCOUNT OF BROKERAGE CHARGES. CONSIDERING THE FACTS AND THE LAW, IT IS PRAYED THAT THE LD. A.O. BE DIRECTED TO ALLOW TH E APPELLANT THE DEDUCTION OF RS. 1,500/- AS CLAIMED OR IN THE ALTER NATIVE EVEN IF THE SAME IS LIABLE TO BE DISALLOWED U/S. 40(A)(IA), IT IS TO BE ALLOWED AS DEDUCTION U/S. 80IB(10), AND HENCE THE DEDUCTION IN RESPECT THEREOF MAY KINDLY BE DIRECTED TO BE GRANTED. GROUND NO. 1-3 ARE IN RELATION TO DENIAL OF DEDUCTI ON U/S. 80IB(10) OF THE ACT. 4. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, AO NOTICED THAT ASSESSEE HAD CONSTRUCTED THE PROJECT VAIBHAV LAXMI . AO WAS OF THE VIEW THAT ASSESSEE WAS NOT ELIGIBLE FOR DEDUCTION U /S. 80IB(10) FOR THE REASON THAT THE ASSESSEE WAS NOT THE OWNER OF THE L AND ON WHICH THE CONSTRUCTION ACTIVITIES WERE CARRIED OUT, ASSESSEE HAD NOT TAKEN THE APPROVAL OF THE HOUSING PROJECT FROM THE LOCAL AUTH ORITY, THE LAND OWNERS HAD SOLD THE PIECES OF LAND TO UNIT HOLDERS DIRECTL Y AND ASSESSEE WAS MERELY A CONFIRMING PARTY, ASSESSEE HAS ACTED MEREL Y AS A CONTRACTOR AS IT ENTERED INTO CONSTRUCTION AGREEMENT WITH THE UNIT H OLDERS AND THE ASSESSEE HAD NEVER SOLD THE HOUSE TO THE UNIT HOLDE RS AS THERE WAS NO REGISTERED DOCUMENT IN RESPECT THEREOF. HE WAS THE REFORE OF THE VIEW THAT ASSESSEE WAS NOT ELIGIBLE FOR DEDUCTION U/S. 80IB(1 0) OF THE ACT AS THE ASSESSEE WAS NOT FULFILLING THE PRESCRIBED CONDITIO NS STIPULATED UNDER THE ACT AND THEREFORE DENIED THE CLAIM OF DEDUCTION U/ S. 80IB(10) OF THE ACT. I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 4 AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATTER BEFORE LD. CIT(A). LD. CIT(A) UPHELD THE ORDER OF AO BY HOLDI NG AS UNDER:- 4.3.5 DEDUCTION U/S 80IB(10) IS AVAILABLE IN RESP ECT OF DEVELOPMENT AND BUILDING OF A HOUSING PROJECT. CLAUSE (B) OF SU B-SECTION 10 OF SECTION 80IB PRESCRIBES THE MINIMUM SIZE OF PLOT OF LAND FOR THE PROJECT AND CLAUSE(C) OF SUB-SECTION 10 OF SECTION 80IB PRESCRIBES MAXIMUM BUILT OF AREA FOR THE RESIDENTIAL UNIT. THU S, IT IS VERY CLEAR THAT A HOUSING PROJECT ELIGIBLE FOR DEDUCTION UNDER SUB-SECTION 10 OF SECTION 80IB MUST COMPRISE OF RESIDENTIAL UNITS VIZ FLATS, BUNGALOWS OR TENEMENTS. EXPLANATION BELOW SUB SECTION 10 CLAR IFIES THAT DEDUCTION UNDER SUB-SECTION 10 OF SECTION 80IB IS N OT AVAILABLE TO ANY UNDERTAKING WHICH EXECUTE THE HOUSING PROJECT A S A WORKS CONTRACT AWARDED BY ANY PERSON. THEREFORE, WHATEVE R MAY BE THE DICTIONARY MEANING OF THE TERM BUILDER AND DEVELOPE R, A BUILDER AND DEVELOPER WITHIN THE MEANING OF PROVISIONS OF SECTI ON 80IB OF THE IT ACT IS ONE WHO IS EXECUTING THE HOUSING PROJECT ON ITS OWN AND NOT AS A CONTRACTOR OF ANYBODY AND WHO IS ELIGIBLE FOR DEDUCTION U/S. 80IB OF THE IT ACT. IN THE SUBSEQUENT DISCUSSION W HENEVER THE TERM BUILDER OR DEVELOPER IS USED IT WILL BE USED IN REF ERENCE TO A BUILDER OR DEVELOPER WHO IS ELIGIBLE FOR DEDUCTION U/S. 80 IB. IN VIEW OF THE ABOVE DISCUSSION, THE POSITION IS VE RY CLEAR IN RESPECT OF AN ENTERPRISE WHICH IS DEVELOPING AND BUILDING A HOUSING PROJECT AS BY ITSELF. IT IS ELIGIBLE FOR DEDUCTION UNDER SU B-SECTION 10 OF SECTION 80IB. THE POSITION IS ALSO VERY CLEAR IN RESPECT OF AN ENTERPRISE WHICH IS DEVELOPING AND BUILDING A HOUSING PROJECT AS A W ORKS CONTRACT BY SOME OTHER PERSON. IT IS NOT ELIGIBLE FOR DEDUCTION UNDER SUB-SECTION 10 OF SECTION 80IB BECAUSE AS CLARIFIED BY THE CBDT AND THE FINANCE ACT THE INCENTIVE IS INTENDED TO BENEFIT DE VELOPERS WHO UNDERTAKE ENTREPRENEURIAL AND INVESTMENT RISK AND N OT CONTRACTORS WHO UNDERTAKE ONLY BUSINESS RISK. THIS IS ALSO SU M AND SUBSTANCE OF THE DECISION IN THE CASE OF RADHE DEVELOPERS QUO TED AND RELIED UPON BY THE APPELLANT. HOWEVER, PROBLEM ARISES WHE N A HOUSING PROJECT IS PARTLY DEVELOPED AND BUILDING ITSELF BY AN ENTERPRISE AND PART OF THE HOUSING PROJECT IS COMPLETED AS A WORKS CONTRACT. IT IS BEYOND DOUBT THAT WHAT THE APPELLANT WAS PLAN NING TO DEVELOP AND BUILD WAS A HOUSING PROJECT AND INITIAL APPROVA LS AND ACTIVITIES WERE SOLELY DIRECTED TOWARDS THAT END. HOWEVER, IN THE END ONLY FULLY DEVELOPED RESIDENTIAL PLOTS HAVE BEEN SOLD BY EXECU TING A REGISTERED I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 5 SALE AGREEMENT. PAGE-7, PARA-2 OF THE SAMPLE SALE D EED PROVIDED BY THE APPELLANT STATES THAT 'AFTER SELLING THE LAND (PLOT) PHYSICAL POSSESSION HAS BEEN HANDED OVER. PAGE-3, PARA-1 OF THE SALE DEED STATES THAT 'FROM THIS MOMENT ONWARDS THE PURCHASER AND HIS LEG AL HEIRS ARE FULL OWNER OF THE LAND DESCRIBED IN THE SCHEDULE AN D THEY ARE ENTITLED TO USE, MANAGE MORTGAGE, SELL OR GIFT IT. FROM THIS POINT ONWARDS THE SELLER AND HIS LEGAL HEIRS HAVE NO SHARE, TITLE OR INTEREST IN THE LAND. THUS, THE PLOT PURCHASER GETS FULL RIGHTS AND CONTR OL OVER THE PROPERTY ON EXECUTION OF THE SALE DEED AND BECOMES ITS ABSOL UTE OWNER. AFTER EXECUTION OF SALE DEED, THE APPELLANT HAS ENT ERED INTO A SEPARATE WRITTEN CONSTRUCTION AGREEMENT WITH THE PL OT PURCHASER FOR CONSTRUCTION OF BUILDING ON THE SAID PLOT. IT DOES NOT MATTER THAT CONSTRUCTION HAS BEEN AS PER UNIFORM DESIGN GOT APP ROVED BY THE APPELLANT FROM CONCERNED AUTHORITIES BECAUSE SUCH A CONDITION CAN ALWAYS BE IMPOSED ON THE PLOT PURCHASERS. MOREOVER, THE PURCHASER HAD AN OPTION TO MAKE CHANGES. BY ENTERING INTO A C ONSTRUCTION AGREEMENT WITH THE PLOT PURCHASER THE APPELLANT HAS MADE HIMSELF A CONTRACTOR OF THE PLOT PURCHASER. THUS, THERE IS NO SALE OF RESIDENTIAL HOUSES BY THE APPELLANT IN A HOUSING PROJECT RATHER THERE IS A SALE OF DEVELOPED RESIDENTIAL PLOTS ONLY (BY THE LAND OWNER S AT THE INSTANCE OF THE APPELLANT). THERE IS NOT A SINGLE INSTANCE W HERE A FULLY CONSTRUCTED PROPERTY HAS BEEN SOLD BY THE APPELLANT . THUS, IT IS CLEAR THAT THE APPELLANT HAD CONSCIOUSLY DECIDED TO SELL FULLY DEVELOPED RESIDENTIAL PLOTS ONLY AND COMPLETE REST OF THE W ORK AS A CONTRACTOR OF THE PLOT OWNERS. DEDUCTION U/S 80IB(10) IS NOT A VAILABLE IN RESPECT OF DEVELOPMENT OF A SCHEME CONSISTING OF RESIDENTIA L PLOTS. IF WE CONSIDER THE HOUSING PROJECT AS A WHOLE IT IS CLEAR THAT THE HOUSING PROJECT IS PARTLY DEVELOPED AND BUILT BY THE APPELL ANT ON ITS OWN AND THE LATER PART OF THE HOUSING PROJECT IS COMPLETED UNDER WORKS CONTRACTS AWARDED BY PLOT PURCHASERS. ROLE OF THE A PPELLANT AS DEVELOPER AND BUILDER OF THE PROJECT GETS OVER AS S OON AS RESIDENTIAL PLOTS ARE SOLD TO INDIVIDUAL PURCHASERS WITH ALL TH E RIGHTS IN THE PLOT. A CONTRACTOR OF INDIVIDUAL PLOT OWNERS, WHO IS CONSTR UCTING HOUSES, CANNOT CLAIM THAT HE IS STILL A DEVELOPER AND BUILD ER OF THE HOUSING PROJECT AND HE IS ENTITLED TO CLAIM DEDUCTION U/S 8 0IB(10) OF THE IT ACT. IF WE CONSIDER GROSS RECEIPTS OF THE ENTIRE PR OJECT IT WILT BE VERY CLEAR THAT MORE THAN 75% OF THE RECEIPTS OF THE PRO JECT COME FROM WORKS CONTRACTS. UNDER THESE CIRCUMSTANCES, I AM OF THE OPINION THAT IT CANNOT BE HELD THAT PROJECT AS A WHOLE HAS BEEN PRIMARILY DEVELOPED AND BUILT BY THE APPELLANT ITSELF WITHIN THE MEANING OF THE I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 6 PROVISIONS OF SECTION 80IB OF THE IT ACT BECAUSE MO RE THAN 75% OF SALE PROCEEDS OF THE PROJECT ARE WORKS CONTRACT REC EIPTS AND NO ENTREPRENEURIAL AND INVESTMENT RISK HAS BEEN TAKEN BY THE APPELLANT IN RESPECT OF THEM. IN FACT, NO ENTREPRENEURIAL AND INVESTMENT RISK HAS BEEN TAKEN BY THE APPELLANT ONCE THE SALE OF PL OTS IN THE PROJECT WAS OVER. THEREFORE, IN MY OPINION, IT CANNOT BE HE LD THAT THE APPELLANT IS A BUILDER AND DEVELOPER OF A HOUSING P ROJECT WITHIN THE MEANING OF THE PROVISIONS OF SECTION 80IB OF THE IT ACT AND THEREFORE, IT IS NOT ENTITLED FOR DEDUCTION U/S 80I B (10) IN RESPECT OF PROFIT DERIVED FROM THE PROJECT UNDER CONSIDERATION . CLAIM OF DEDUCTION U/S 80IB (10) AMOUNTING TO RS.8,03,273/- BY THE APPELLANT IS HEREBY DISALLOWED. 5. AGGRIEVED BY THE ORDER OF LD. CIT(A), ASSESSEE I S NOW IN APPEAL BEFORE US. 6. BEFORE US LD. AR SUBMITTED THAT THE PROJECT ON W HICH THE ASSESSEE HAS CLAIMED THE DEDUCTION WAS THE SAME PROJECT ON W HICH THE CLAIM OF DEDUCTION U/S. 80IB(10) WAS ALLOWED BY LD. CIT(A) I N A.Y. 2004-05 AND WAS ALSO CONFIRMED BY HONBLE ITAT. HE POINTED TO THE RELEVANT FINDINGS OF LD. CIT(A) AND THE COPY OF WHICH IS PLACED AT PAGE 33 OF THE PAPER BOOK. WITH RESPECT TO THE DENIAL OF DEDUCTION BY LD. CIT( A) FOR THE REASON THAT THE ASSESSEE HAD SOLD FULLY RESIDENTIAL PLOTS AND T HE REST OF THE WORK WAS COMPLETED AS A CONTRACTOR, HE PLACED RELIANCE ON TH E DECISION IN THE CASE OF SATSANG DEVELOPERS IN ITA NO. 1011 & 2498/AHD/20 12. HE THEREFORE SUBMITTED THAT ASSESSEE IS ELIGIBLE FOR DEDUCTION U /S. 80IB(10). LD. DR ON THE OTHER HAND SUBMITTED THAT THERE IS NOTHING ON R ECORD TO DEMONSTRATE THAT THE PROJECT ON WHICH THE ASSESSEE WAS CLAIMING DEDUCTION U/S. 80IB(10) WAS HOUSING PROJECT AND FURTHER SUBMITTED THAT THE FACTS IN THE CASE OF SATSANG DEVELOPERS(SUPRA) ARE DISTINGUISHAB LE AND THEREFORE DO NOT APPLY TO THE PRESENT CASE. HE THUS SUPPORTED T HE ORDER OF AO AND LD. CIT(A). I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 7 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT AO HAD DENIED THE CLAIM OF D EDUCTION U/S. 80IB(10) TO THE ASSESSEE FOR THE REASON THAT THE ASSESSEE WA S NOT THE OWNER OF THE LAND AND WAS MERELY A CONTRACTOR. BEFORE US ASSESS EE HAD SUBMITTED THAT IN EARLIER YEARS I.E. A.Y. 2004-05 THE ASSESSEES C LAIM FOR DEDUCTION U/S. 80IB(10) WAS ALLOWED BY LD. CIT(A) AND WHICH WAS AL SO CONFIRMED BY THE HONBLE TRIBUNAL IN ITA NO. 1750/AHD/2010 ORDER DAT ED 15-10-2010. FURTHER IT IS ASSESSEES SUBMISSION THAT THE PROJEC T ON WHICH THE ASSESSEE IS CLAIMING THE DEDUCTION U/S. 80IB(10) IS THE SAME PROJECT AND THE AFORESAID SUBMISSION OF THE ASSESSEE HAS NOT BEEN C ONTROVERTED BY THE REVENUE BY BRINGING ANY CONTRARY MATERIAL ON RECORD . WITH RESPECT TO THE ARGUMENT OF THE REVENUE THAT THE LAND WAS SOLD SEPA RATELY AND THE CONSTRUCTION WORK WAS UNDERTAKEN BY A SEPARATE AGRE EMENT, WE FIND THAT ON IDENTICAL ISSUE IN THE CASE OF SATSANG DEVELOPER S(SURPA), THE CO- ORDINATE BENCH OF TRIBUNAL IN ITA NO. 1011 & 2498/A HD/2012 DATED 12-11- 2013 WAS DECIDED BY THE CO-ORDINATE BENCH OF TRIBUN AL BY HOLDING AS UNDER:- 9.2. NOW WE TAKE UP THE THIRD AND LAST OBJECTION O F ID.CIT (A) THAT THE ASSESSE HAD SOLD THE LAND SEPARATELY AND UNDERT OOK THE CONSTRUCTION WORK AS PER A SEPARATE AGREEMENT AND, THEREFORE THE ASSESSEE IS NOT A BUILDER OR A DEVELOPER BUT A LAND DEALER AND CONTRACTOR. IN THIS REGARD, IN OUR CONSIDERED OPINI ON, THE ISSUE INVOLVED IS SQUARELY COVERED IN FAVOUR OF ASSESSEE BY THE DECISION OF ITAT INDORE BENCH RENDERED IN THE CASE OF M/S.VARDH MAN BUILDERS AND DEVELOPERS VS ITO (SUPRA). IT IS NOTED BY THE T RIBUNAL IN THAT CASE THAT THE ASSESSE HAD ENTERED INTO AN AGREEMENT FOR A SALE OF LAND AND A SEPARATE AGREEMENT FOR CONSTRUCTION OF T HE HOUSE ON THE LAND AND, THEREFORE, THE FACTS ARE SIMILAR. UNDER T HESE FACTS, IT WAS HELD BY THE TRIBUNAL IN THAT CASE THAT THE CLAIM OF THE ASSESSEE FOR DEDUCTION U/S.80-IB (10) OF THE ACT CANNOT BE DECLI NED IF OTHER CONDITIONS ARE BEING SATISFIED. SIMILARLY, IN THE C ASE OF DCIT VS. SMR BUILDERS (P.) LTD. (SUPRA) ALSO, THE ASSESSE SOLD T HE LAND ALONG WITH I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 8 SEMI-FINISHED STRUCTURE TO THE BUYERS AND AS PER SE PARATE AGREEMENT, AGREED FOR CONSTRUCTION FOR COMPLETION O F BALANCE WORK. HENCE, THE FACTS OF THIS CASE ARE ALSO SIMILAR BECA USE IN THAT CASE ALSO, THE LAND WAS SOLD SEPARATELY ALONG WITH PARTI AL AND UNFINISHED CONSTRUCTION FLATS AND, THEREAFTER, CONSTRUCTION AG REEMENT WAS ENTERED INTO TO CARRY OUT THE BALANCE CONSTRUCTION WORK AND UNDER THESE FACTS, IT WAS HELD BY THE TRIBUNAL IN THAT CA SE THAT SUCH AGREEMENT FOR CONSTRUCTION TO COMPLETE THE BALANCE WORK IS ONLY AN INCIDENTAL FACILITATION TO PROTECT INTEREST OF THE PARTIES AND THEREFORE, THE ASSESSEE IS ELIGIBLE FOR DEDUCTION U/S. 80-IB(1 0) OF THE ACT. SIMILARLY, IN THE CASE OF RAGHAVA ESTATES VS. DY.CL T (SUPRA) ON WHICH RELIANCE WAS PLACED BY THE LD. AR OF THE ASSE SSEE, THE FACTS ARE SIMILAR. IN THAT CASE ALSO, THE ASSESSEE HAD SO LD THE PLOTS SEPARATELY AND THEREAFTER, CONSTRUCTED THE HOUSES A ND UNDER THESE FACTS, THE REVENUE HELD THAT THE ASSCSSEE HAS TO BE CONSIDERED AS A MERE CONTRACTOR AND, THEREFORE, THE ASSESSEE IS NOT ELIGIBLE FOR DEDUCTION U/S.80-IB (10) OF THE ACT. THIS GOES TO S HOW THAT THE FACTS IN THAT CASE WERE IDENTICAL. IN THAT CASE, IT WAS N OTED BY THE TRIBUNAL THAT THE ASSESSEE HAD CHOSEN TO REGISTER THE PLOT I N THE NAME OF THE BUYER ON PAYMENT OF SPECIFIED AMOUNT IN ORDER TO AC HIEVE COST SAVING AND TO ENSURE RELIABILITY AND THEREAFTER, TH E ASSESSEE HAD NEEDED TO CONSTRUCT THE HOUSE AS PER BUILDING PLAN OBTAINED IN THE NAME OF PLOT-OWNERS ON PAYMENT OF SUBSEQUENT INSTAL LMENTS. IT IS ALSO NOTED THAT THE ASSESSEE HAD ALSO DEVELOPED VAR IOUS PUBLIC AMENITIES WITHIN THE PROJECT. THEREAFTER, IT WAS H ELD BY THE TRIBUNAL THAT ON A TOTALITY OF A FACT, THE TRIBUNAL IS OF TH E VIEW THAT THE ASSESSEE HAS UNDERTAKEN DEVELOPING AND BUILDING HOU SING PROJECTS AS PER THE SCHEME PROVIDED IN SECTION 80-IB (10) OF THE ACT. 8. BEFORE US THE REVENUE HAS NOT BROUGHT ANY CONTRA RY BINDING DECISION IN ITS SUPPORT. WE THEREFORE RESPECTFULLY FOLLOWING THE AFORESAID DECISION OF CO-ORDINATE BENCH IN THE CASE OF SATSAN G DEVELOPERS (SUPRA), ARE OF THE VIEW THAT ASSESSEE IS ELIGIBLE FOR DEDUC TION U/S. 80IB. WE HOLD ACCORDINGLY. IN THE RESULT, THIS GROUND OF ASSESSE ES APPEAL IS ALLOWED. 9. GROUND NO. 4 WAS NOT PRESSED AND THEREFORE DISMI SSED AS NOT PRESSED. I.T.A NO. 44/AHD/2013 A.Y. 2007-08 PAGE NO SHREERANG DEVELOPERS VS. ITO 9 10. IN THE RESULT, ASSESSEES APPEAL IS PARTLY ALLO WED. ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONE D HEREINABOVE AT CAPTION PAGE SD/- SD/- (G.C. GUPTA) (ANIL CHATURVEDI) VICE PRESIDENT ACCOUNTANT MEMBER AHMEDABAD : DATED 27/08/2014 AK / COPY OF ORDER FORWARDED TO:- 1. ASSESSEE 2. REVENUE 3. CONCERNED CIT 4. CIT (A) 5. DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER/ , / ,