s.80(IB)(10)- ownership of land

[rajul5234]

gujarat high court has fixed  RADHE CONSTRUCTION group issue for final disposal on 5/10/11.

whether OWNERSHIP of land is a pre condition for entitlement to ded. u/s 80 IB(10) to a developer?

R. K. patel.

[camanojgupta]

In Radhe Developers & Ors. v. ITO & Ors. (2008) 20 (II) ITCL 512 (Ahd 'A'-Trib) : (2008) 23 SOT 420 (Ahd 'A'-Trib) : (2008) 113 TTJ (Ahd-Trib) 300 it was held that deduction under section 80-IB is allowable to an undertaking developing and building housing project, whether it is developed by it as contractor or as an owner.
In the case of ACIT v. M/s Sashwath Constructions (P) Ltd. in I.T.A. No. 1069 (Mds.)/2008 for the assessment year 2005-06 dated 25-2-2009, it was held as follows :
"In our opinion it is not sine qua non for a developer to become the de jure owner of the land. It is quite possible to develop the property with the consent of the owner. It transpires from the perusal of the records that the assessee was the de facto owner of the property, as the entire allotment procedure was executed by the assessee-company only. We have noted that the assessee did incur all the expenses connected with the development of the property. Application for planning permission was also made by the assessee. Necessary fee for the same was paid by it. Road formation was also done by the assessee. Besides, for marketing the flats the assessee did advertise the property also. We have perused the reasonings adduced by the CIT(A) in the impugned order. In our opinion he took a correct view in the matter and his order calls for no interference on this count. Accordingly we uphold the same."
In ACIT v. C. Rajini (2011) 37 (II) ITCL 548 (Chen 'A'-Trib), similar views were taken
So the ITAT has so far taken the view that developer need not be thwe owner of land
LET US SEE WHAT THE HC DECIDES
CA MANOJ GUPTA
JODHPUR
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