2018 (9) TMI 540 - HC - Income Tax

Proportionate deduction u/s 80IB(1) - existence of any provision for pro rata deduction in the statute - some of the flats violated the condition of not exceeding area of 1000 sq. ft. and thus vitiating the whole project - Held that - We did so as prima facie we were of the opinion that the substantial question raised in this Appeal was covered by a subsequent decision of a Division Bench of this Court in the case of Commissioner of Income Tax-6, Pune v/s Makwana Brothers and Co 2017 (11) TMI 684 - BOMBAY HIGH COURT . On going through this decision in some detail, we find that though a similar question was raised in those Appeals, Mr. Kotangle argues that the question raised herein was decided on facts by relying upon the decision of another Division Bench in the case of Commissioner of Income Tax v/s Vandana Properties 2012 (4) TMI 54 - BOMBAY HIGH COURT . We admit the Appeal on this substantial question of law reproduced above. The Registrar (Judicial) / Registrar, High Court, Original Side, Bombay to ensure that the original record in relation to this Appeal is summoned from the Tribunal and offered for inspection of the parties. This paper book is treated sufficient for the purpose of admission of this Appeal. However, the Registry must further ensure preparation of complete paper book in accordance with the Rules. The Registry, in the first instance, must send intimation of admission of this Appeal enclosing therewith a copy of this order so as to enable the Tribunal to act accordingly.

Summary

Issues: Appeal against the dismissal of the Revenue's appeal by the Income Tax Appellate Tribunal regarding the deduction under section 80IB(10) in a project where some flats exceeded the specified area limit.

Analysis:
The judgment pertains to an appeal challenging the order of the Income Tax Appellate Tribunal (ITAT) dismissing the Revenue's appeal. The main issue raised in the appeal is whether the ITAT was justified in allowing the proportionate deduction under section 80IB(10) despite some flats in the project exceeding the prescribed area limit of 1000 sq.ft. The appellant's counsel argued that there was no provision for pro rata deduction in the statute, and the violation of the area condition by some flats could invalidate the entire project. The court noted that similar questions of law had been admitted in other appeals filed by the Revenue, indicating the significance of the issue at hand.

The court considered the arguments presented by the appellant's counsel and observed that the question raised in the present appeal had been addressed in previous decisions by different Division Benches. Initially, the court was inclined to rely on a prior decision; however, upon closer examination, it was found that the specific question raised in this appeal had been decided based on facts and the precedent cited by the appellant's counsel. Consequently, the court admitted the appeal for consideration on the substantial question of law as presented by the appellant.

In furtherance of the appeal process, the court directed the Registrar to ensure the summoning of the original record from the Tribunal for inspection. The court emphasized the importance of a complete paper book prepared in accordance with the rules for the admission of the appeal. Additionally, the court ordered that the appeal be heard along with other related income tax appeals that were pending for a considerable duration. To expedite the process, a fixed date for the hearing was set for all the appeals, demonstrating the court's commitment to addressing the pending matters promptly and efficiently.

Overall, the judgment reflects a meticulous examination of the legal issues raised in the appeal, highlighting the court's adherence to procedural requirements and the pursuit of timely resolution of the pending appeals.