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Issues involved: Interpretation of deduction claim under section 80-I of the Income-tax Act, 1961 based on the timing of filing audit report in Form No. 10CCB.
Summary: The Revenue filed an application under section 256(2) of the Income-tax Act, 1961, seeking a reference to the High Court regarding the justification of the Tribunal's decision on the deduction claim under section 80-I. The question raised was whether the Tribunal was correct in allowing the claim even though the audit report in Form No. 10CCB was not filed along with the return of income as required by law. The assessee had initially claimed a deduction under section 80-I, which was disallowed by the Assessing Officer. However, both the Commissioner of Income-tax (Appeals) and the Tribunal later allowed the deduction upon finding that the audit report in Form No. 10CCB was filed during the assessment proceedings. The Revenue contended that the statutory requirement mandated filing the audit report along with the return, and filing it later during assessment did not comply with this requirement. The Tribunal, citing the judgment of the Gujarat High Court in CIT v. Gujarat Oil and Allied Industries [1993] 201 ITR 325, disagreed with the Revenue's argument. The Tribunal held that the filing of the audit report during assessment constituted substantial compliance with the statutory requirement under section 80-I(7). The High Court agreed with the Tribunal's view, emphasizing that disallowing the deduction solely based on the technicality of the audit report not being attached to the return would be unjustified. As the audit report's existence was confirmed and it was presented during the assessment proceedings, the Court deemed it sufficient compliance with the law. Consequently, the High Court upheld the Tribunal's decision to reject the Revenue's request for reference under section 256(1) and dismissed the application accordingly.
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