2011 (3) TMI 1709 - HC - Income Tax

Summary

Issues involved: Eligibility of respondent assessee for benefit under Section 80IB of the Income Tax Act for assessment year 2004-2005.

Issue (A): The question raised was whether the assessee was entitled to deduction u/s.80IB of the Act on cattle feed expansion when the conditions stipulated in the section were not fulfilled. The tribunal found that the claim of the assessee should not have been declined on a technical ground and remanded the proceedings for fresh consideration. The tribunal observed that the units set up in the financial years 1993-94 and 1997-98 were considered eligible for the benefit under section 80IB, but for the units set up in the assessment year 2004-2005, deduction was denied on the ground that the audit report was not correctly filed or a separate balance sheet was not filed.

Issue (B): The question raised was whether the Appellate Tribunal was right in law and on facts in restoring the issue to the file of the Assessing Officer for grant of deduction u/s.80IB of the Act amounting to Rs. 1,70,26,645 on cattle feed expansion. The tribunal directed the assessee to furnish all necessary information, including a certificate from an auditor, for computing the eligible profit of the units. The High Court found no reason to interfere with the tribunal's decision, as the tribunal had properly directed the assessee to supply the necessary information for the Assessing Officer to examine the benefit claimed.

In essence, the controversy revolved around the eligibility of the respondent assessee for benefit under Section 80IB of the Income Tax Act for the assessment year 2004-2005 when the assessee expanded its existing units. The tribunal's decision to remand the issues for fresh consideration by the Assessing Officer and to require the assessee to furnish necessary information, including an auditor's certificate, was upheld by the High Court. The tax appeal was dismissed based on the above discussion.