2018 (10) TMI 1703 - AT - Income Tax

Disallowance of deduction claimed u/s. 80IA - HELD THAT - Undisputedly facts and circumstances of present AY 2006-07 are quite similar and identical to the facts and circumstances of the AY 2007-08 and 2010-11 therefore we have no hesitation to hold that the Tribunal has allowed deduction u/s. 80IA to the assessee by dismissing appeal of the Revenue and upholding the order of the CIT(A) for these two years. Therefore respectfully following the same we hold that the CIT(A) was allowed for allowing deduction u/s. 80IA of the Act to the assessee for AY 2006-07 and there is no valid reason to interfere with the same. Accordingly sole ground of Revenue being devoid of merits is dismissed.

Summary

Issues Involved:
Allowability of deduction u/s. 80IA of the Income Tax Act.

Detailed Analysis:

Issue 1: Allowability of deduction u/s. 80IA

The appeals and cross objections were filed against the order of the Commissioner of Income Tax (Appeals) regarding the disallowance of a deduction claimed under section 80IA of the IT Act. The parties agreed that the facts for all assessment years were similar. The Tribunal decided to focus on the lead cases for assessment year 2006-07. The Assessee's Representative withdrew the cross objections, and the sole ground in the Revenue's appeal was the disallowance of the deduction claimed under section 80IA.

The Tribunal considered the arguments and material presented by both parties. The Assessee's Representative referred to a previous order by ITAT, Ahmedabad, which had decided a similar issue in favor of the assessee. The Departmental Representative did not dispute this fact. The Tribunal noted that the issue had been decided in favor of the assessee in previous cases by ITAT, Ahmedabad, based on the principles of transfer pricing and market value of goods or services transferred between different business units of the assessee.

The Tribunal further analyzed the issue based on the rule of consistency. It emphasized that unless contrary facts were presented by the Revenue, the principle of consistency should be followed. The Tribunal cited various judicial pronouncements supporting the importance of consistency in tax proceedings. It concluded that in the absence of any adverse material or contrary facts, the assessee had a strong case in their favor based on the principle of consistency.

Based on the above analysis and considering the similarity of facts and circumstances with previous years, the Tribunal held that the deduction under section 80IA should be allowed to the assessee for the relevant assessment years. The appeals of the Revenue were dismissed, and the orders of the Commissioner of Income Tax (Appeals) allowing the deduction were upheld.

In conclusion, the Tribunal dismissed all appeals and cross objections, affirming the allowance of the deduction under section 80IA of the Income Tax Act for the relevant assessment years.

This detailed analysis provides a comprehensive overview of the judgment, focusing on the key issue of the allowability of deduction u/s. 80IA of the Income Tax Act.