The Delhi bench of the Income Tax Appellate Tribunal ( ITAT ) allowed a claim for deduction under Section 80IB(10) of the Income Tax Act, 1961 in respect of flats whose area exceeds 1000 square feet, excluding balconies that are open to the sky.
Disallowance of deduction under Section 80IB(10) of the Income Tax Act in respect of built up area exceeding the limit of 1000 sq. fts only when an area of open balcony was added to build up area. Mr. Rajkumar representing the assessee submitted that this issue was decided in favour of the assessee.
The bench therefore directed that the assessee be allowed the claim of deduction under Section 80IB (10) in respect of flats which have been excluded from the benefit of deduction by including the balconies open to sky for the purpose of calculating the built-up area of the individual units.
Further held that the balconies open to the sky are to be excluded from the calculation of the built-up area of a particular residential unit and accordingly qualify for deduction under Section 80IB (10) of the Income Tax Act. Further hold that in view of the dispute as to the measurements between the assessee and the DVO, further restore this limited issue as to the discrepancy in measurements in respect of the alleged units with the area exceeding 1000 Sq. to the file of the Assessing Officer for fresh examination and adjudication thereon after giving due opportunity to the assessee to present their case.
The two member bench of the tribunal comprising Dr. B.R.R. Kumar (Accountant member) and C.N Prasad (Judicial member) allowed the claim for deduction under Section 80IB(10) of the Income Tax Act in respect of those flats whose area exceeds 1000 sq. fts excluding balcony open to the sky. The Assessing Officer was directed to verify the claim of the assessee after obtaining the details and allow deduction in view of the observations of the tribunal in assessee’s own case for the assessment years 2008-09 to 2010-11 after providing adequate opportunity of being heard to the assessee.
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