Deduction u/s 80ib(10)
This query is : Open
22 February 2012
If the owner of land & developer joins together and enter into a development agremeent and all the conditions of section 80ib(10) are fulfilled then who will be eligible for deduction u/s 80ib(10)i.e. owner of land or the developer of property.Give your reply with a suitable case law if you have.
22 February 2012
Ded u/s 80-IB(10) is available in respect of profits and gains derived from developing and building of housing projects. So it is the developer who is entitled to deduction under the said section. The gujarat HC in Radhe Developers case has also held that ownership of land is not necessary for ded u/s 80-IB(10).
CA MANOJ GUPTA
JODHPUR
09828510543
CA MANOJ GUPTA
JODHPUR
09828510543
22 February 2012
In the case of Radhe Developers it was held that ownership of land is not necessary to claim deduction for developer.But my question whether the land owner of the property can also claim deduction of his share of revenue in developing the property.
22 February 2012
If the owner is developer then there is no problem in allowability of deduction
22 February 2012
Actually the property is completely developed by a developer and not land owner.The land owner has entered into development agreement and has agreed to get 30% of saleable flats in lieu of the land and 70% saleable flats has to be alloted to the developer.
22 February 2012
In such a case, where agreement itself speaks that the owner of the land would get consideration for land , then he is not entitled for deduction U/s 80IB(10).
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The undertaking developing and building housing project is only eligible for deduction.
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By entering into Development Agreement it can be said that the owner has transferred the land and he is concerned with the consideration of the Land only.
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The undertaking developing and building housing project is only eligible for deduction.
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By entering into Development Agreement it can be said that the owner has transferred the land and he is concerned with the consideration of the Land only.
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22 February 2012
Sir,its not mentioned in the agreement that it is the consideration for land,but yes its deemed to be the consideration for land.so whether claim can be made.I have came across many assessee who have claimed the deduction.If you can provide me with any case law regarding the same it will be very helpful.
22 February 2012
please refer to the case law dcit v/s bombay real estate development company pvt ltd (itat mumbai) and give your valuable suggestions.
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