INCOME TAX ACT, 1961

Section 80-IB(10)

Deduction under section 80-IB(10) - Income from developing and building housing project - Denial of entire deduction as area of one unit exceeded 1500 square feet -

Assessee was engaged in business of development and building infrastructure housing projects. It claimed deduction under section 80-IB(10). AO denied the deduction under section 80-IB(10) on the ground that one of the units of housing project, was above 1,500 square feet and therefore, the entire claim of deduction under section 80-IB was rejected. On appeal, the disallowance made by the AO under section 80-IB(10) was restricted to one unit found in excess of 1,500 square feet, and remaining disallowance was deleted. Aggrieved, Revenue was in appeal. Held: It was undisputed that only one unit of housing project was admeasuring 1,508.41 square feet. Thus, simply because out of several units included in the housing project, only one of them exceeded the upper limit of area and that too, by a small margin; the deduction claimed under section 80-IB(10) could not be denied in respect of the entire housing project. Hence, CIT(A) was justified in allowing proportionate deduction under section 80-IB(10).

Followed:Viswas Promoters (P) Ltd. v. Asstt. CIT (2013) 29 taxmann.com 19 (Mad) : 2013 TaxPub(DT) 0489 (Mad-HC), Pr. CIT v. M/s. Shreenath Buildcon (2019) 110 taxmann.com 390 (SC) : 2019 TaxPub(DT) 0975 (SC)

REFERRED :

FAVOUR : In assessee's favour

A.Y. :

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