Inclusion of private terrace in sale deed
Suman Kundu
(Querist) 15 April 2023
This query is : Resolved
Hi,
I am going to buy and register an apartment with Private Terrace which is attached /adjacent to the apartment, the entry is possible only through the apartment and has Exclusive rights of entry with the Owners only.
Request your kind advise on the best narration to include the same in Sale deed.
Best Regards,
Suman
T. Kalaiselvan, Advocate
(Expert) 18 April 2023
If terrace has not used FSI of the building, then terrace is not a salable area, and it belongs to society. Then, a person who uses it, even if his sale deed has started terrace, then it is an illegal purchase.
In the real legal sense, the private terrace is not open to other residents to enter that place. Therefore, it is not a common area like open terrace.
A terrace is an open space that can be attached or detached to a building.
a terrace can have multiple access points,
In a significant ruling, the ITAT Chennai held that the private open terrace attached with residential unit would form part of built-up area for the purpose of computing deduction under section 80-IB(10) of the Income Tax Act if the same was included in the house project approved by the local authority.
The Revenue contended that the private open terrace is for exclusive use of attached residential units. The access to private open terrace is only from residential units as opening doors provided only from residential units like from bedroom, halls, etc. The private open terrace was sold to the owners for their exclusive use, therefore, it was contended that the private open terrace is nothing but a built-up area as provided in Section 80-IB(10) of the Income Tax Act. and therefore, the floor space index exceeds 1500 sq.ft., hence, the assessee is not eligible for deduction under Section 80-IB(10) of the Income Tax Act. The assessee, on the other hand, relied on the decision in Ceebros Hotels Pvt. Ltd, and submitted that the open terrace has to be excluded and it cannot be treated as built-up area.
Analyzing the ratio laid down in the decision of Madras High Court, the bench opined that it is necessary to examine the housing project approved by the local body. “In other words, whether the so-called private open terrace said to be attached with private residential unit would form part of built-up area as per housing project or it was excluded from the approval granted by local authority.”
You may produce the property related papers before an experienced local lawyer and get his opinion before proceeding.
