INCOME TAX ACT, 1961

Section 80-IB(10)

Deduction under section 80-IB(10) - Income from developing housing project - Interest received by assessee for delay in payment against purchase of flat booked by clients -

Issue involved was related to disallowance made by AO and confirmed by CIT(A) on account of assessee's claim for deduction under section 80-IB(10) of the Income Tax Act, 1961 in respect of interest received amounting to Rs. 11,10,810 and other income amounting to Rs. 6,36,746. As per AO the said income was not derived by the assessee from the business of development of housing project and the same, therefore, was not eligible for deduction under section 80-IB(10). Held: Income by way of transfer fees received by assessee for apartment booking and interest received for delay in payment against flat had a direct or first degree connection with the business of the assessee of developing a housing project and the same, therefore, was eligible for deduction under section 80-IB(10). The immediate source of the said income was the business of the assessee of developing a housing project and therefore, the said income was eligible for deduction under section 80-IB(10). Regarding balance amount of other income, assessee was not able to furnish any details of the same to show that the said amount was eligible for deduction under section 80-IB(10).

Followed:ACG Associated Capsules (P) Ltd. v. CIT [2012 TaxPub(DT) 0651 (SC)]

REFERRED :

FAVOUR : Partly in assessee's favour

A.Y. :

INCOME TAX ACT, 1961

Section 43B

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