2017 (7) TMI 1290 - HC - Income Tax

Deduction under Section 80IB(10) in respect of redevelopment project - not eligible for deduction in view of the board instructions under Section 119 - Tribunal allowed claim - as per revenue tribunal was not justified in overwriting the notification of the board under Section 119 of the Act - HELD THAT - The Commissioner Appeals in his judgment has specifically observed that the project of the assessee is approved as slum rehabilitation project by slum rehabilitation authority of the State and the same has also been notified. The assessee has submitted the project and the plan dated 28/04/2004 and the same was approved by the Rehabilitation Authority on 04/06/2004, the same is filed on record. The Tribunal has also considered the said aspect, so also proviso to Section 80IB(10) of the Act and has correctly passed the order. The judgment of the Tribunal cannot be faulted with.

Summary

Issues:
1. Applicability of deduction under Section 80IB(10) of the Income Tax Act, 1961 for a redevelopment project.
2. Validity of the Tribunal's decision in overriding the board instructions under Section 119 of the Act.

Analysis:

Issue 1: Applicability of deduction under Section 80IB(10)
The appeal in question pertained to the assessment year 2009-2010. The appellant contended that the assessee was not entitled to deduction under Section 80IB(10) of the Income Tax Act for a redevelopment project, citing board instructions under Section 119 of the Act. The Commissioner [Appeals] noted that the project was approved as a slum rehabilitation project by the state's slum rehabilitation authority and duly notified. The project and plan were submitted on 28/04/2004 and approved on 04/06/2004 by the Rehabilitation Authority. The Tribunal, after considering these aspects along with the proviso to Section 80IB(10) of the Act, upheld the eligibility of the project for the deduction. The judgment of the Tribunal was deemed appropriate and not faulty.

Issue 2: Validity of Tribunal's decision
The learned counsel for the appellant argued that the Tribunal had erred in overriding the notification of the board under Section 119 of the Act. However, the respondent's counsel supported the Tribunal's decision. The Tribunal's order was found to be in line with the approval granted by the Rehabilitation Authority for the slum rehabilitation project, as well as the provisions of Section 80IB(10) of the Act. Consequently, the High Court found no reason to interfere with the Tribunal's decision and dismissed the appeal without costs.

In conclusion, the High Court upheld the Tribunal's decision regarding the eligibility of the redevelopment project for deduction under Section 80IB(10) of the Income Tax Act, 1961, and found no grounds for faulting the Tribunal's judgment in this regard.