2010 (7) TMI 1031 - AT - Income Tax

Summary

Issues:
1. Claim of deduction u/s 80IB in original vs. revised return
2. Entitlement to claim deduction u/s 80IB after disallowance of deduction u/s 10B
3. Violation of Rule 46A in admitting an alternate claim without granting an opportunity to the AO

Analysis:

Issue 1: Claim of deduction u/s 80IB in original vs. revised return
The appeal was filed by the Revenue challenging the order of the ld. CIT(A) regarding the assessee's claim of deduction u/s 80IB. The ld. CIT(A) allowed the claim of deduction u/s 80IB for the first unit, even though the claim was withdrawn in the revised return. The Revenue argued that once a claim is withdrawn in the revised return, it cannot be entertained, citing various judgments. However, the Tribunal held that if the conditions for deduction u/s 80IB are satisfied, the claim can be considered, especially if directed by the appellate authority. The Tribunal relied on precedents to emphasize that if the claim is on record, it should be examined and decided in accordance with the law.

Issue 2: Entitlement to claim deduction u/s 80IB after disallowance of deduction u/s 10B
The assessee initially claimed deduction u/s 10B, which was disallowed by the AO. Subsequently, the assessee sought to claim deduction u/s 80IB for a separate unit. The AO rejected this claim due to procedural defects and investment exceeding the limit specified for the deduction. The ld. CIT(A) directed the AO to consider the claim of deduction u/s 80IB for the first unit, emphasizing that if the assessee is not entitled to deduction u/s 10B, a claim u/s 80IB can be made if the conditions are met.

Issue 3: Violation of Rule 46A in admitting an alternate claim without granting an opportunity to the AO
The Revenue contended that there was a violation of Rule 46A in admitting an alternate claim without providing an opportunity to the AO to rebut the claim. However, the Tribunal found no merit in this argument as there was no evidence of additional documents or evidence admitted by the ld. CIT(A) without due process. Therefore, the Tribunal rejected this ground raised by the Revenue.

In conclusion, the Tribunal dismissed the appeal filed by the Revenue, upholding the order of the ld. CIT(A) to allow the claim of deduction u/s 80IB for the first unit. The Tribunal emphasized the importance of examining claims based on the facts and legal provisions, even if initially withdrawn in a revised return, as long as the conditions for the deduction are met.