Housing project – Special deduction u/s 80-IB(10) – Open terrace of building not to be included for computation of built-up area – Time limit for completion of project – Date of approval of building plan and not date of lay-out – Completion certificate issued by local panchayat would satisfy requirement of section – Assessee entitled to deduction

Housing project – Special deduction u/s 80-IB(10) – Open terrace of building not to be included for computation of built-up area – Time limit for completion of project – Date of approval of building plan and not date of lay-out – Completion certificate issued by local panchayat would satisfy requirement of section – Assessee entitled to deduction

The assessee developed housing projects and claimed deduction u/s 80-IB(10) for the A.Y. 2010-11. The Tribunal held that (a) the open terrace area of the building should not be included while computing the built-up area for the purpose of claiming deduction u/s 80-IB(10), (b) the time limit for completion of the eligible project should not be computed from the date on which the lay-out was approved for the first time but only from the date on which the building plan approval was obtained for the last time, and (c) the completion certificate issued by the local panchayat would satisfy the requirements of the section instead of the completion certificate issued by Chennai Metropolitan Development Authority which had originally approved the plan.

On appeal by the Revenue, the Madras High Court upheld the decision of the Tribunal and held as under:

‘The Tribunal was right in holding that, (i) the open terrace area should not be included while computing the built-up area for the purpose of claiming deduction u/s 80-IB(10), (ii) the time limit for completion of the eligible project should not be computed from the date on which the lay-out was approved for the first time, but only from the date on which the building plan approval was obtained for the last time, and (iii) the completion certificate issued by the local panchayat would satisfy the requirements of the section instead of the completion certificate issued by the Chennai Metropolitan Development Authority which had originally approved the plan.’