2018 (7) TMI 1321 - HC - Income Tax

Grant of relief to the assessee u/s.80IA(4) - whether income of the assessee from the Industrial Park whether to be assessed under the head Income from Business, without going into admissibility of the claim on merits - Held that - Apex Court reported in COMMR. OF INC. TAX v. COCANADA RADHASWAMI BANK LTD 1965 (4) TMI 11 - SUPREME COURT held that the head under which income is assessed is not relevant for the purpose of claiming exemption under the Act. When the Revenue had accepted the view of the Commissioner of Income Tax (Appeals) on Section 80IA that the assessee had complied with Section 80IA(4)(iii) of the Act, there remains nothing for an enquiry either as to the nature of the receipt or for that matter the facilities developed to be treated as an industrial park to consider the question of deduction under Section 80IA(4)(iii) of the Act. When the character of the receipt is not a question to be gone in the matter of considering the claim of deduction under Section 80IA(4)(iii) of the Act, we do not find that any useful purpose would be served for the Revenue to again insist on a decision on the character of the receipt. - Decided in favour of assessee

Summary

Issues:
Challenge to order passed by Income Tax Appellate Tribunal regarding relief under section 80IA(4) for Assessment Year 2009-10.

Analysis:
1. The Revenue appealed against the ITAT order, questioning the correct interpretation of the judgment by the High Court for granting relief to the assessee under section 80IA(4) without assessing the claim's admissibility on merits.

2. The counsel for the Revenue acknowledged a previous Division Bench judgment in favor of the assessee for assessment years 2002-03 to 2008-09, which was pending before the Apex Court. The central issue was whether the Tribunal correctly interpreted the High Court's judgment to grant relief under section 80IA(4) without delving into the claim's merits.

3. The Division Bench in the previous case held that the character of the receipt was not relevant for granting relief under section 80IA(4)(iii) and that the Revenue had accepted the eligibility criteria for the deduction. The Tribunal's remand order for further inquiry was deemed academic and unjustified.

4. The Tribunal in the instant case, following the High Court's previous judgment, allowed the assessee's appeal for the assessment year 2009-10 based on the approval for setting up an industrial park and entitlement to claim deduction under section 80IA.

5. The Court dismissed the Revenue's contentions, citing the statutory provision for appeals to the Supreme Court and the previous judgment's unfavorable answers to substantial questions of law. The appeal was thus dismissed, upholding the relief granted to the assessee under section 80IA(4).

In conclusion, the High Court affirmed the Tribunal's decision to grant relief under section 80IA(4) to the assessee for the assessment year 2009-10 based on the interpretation of the judgment and eligibility criteria established in previous cases. The Revenue's appeal was dismissed, emphasizing the precedence set by the earlier Division Bench judgment and the statutory provisions for appeals to the Supreme Court.