2021 (7) TMI 295 - AT - Income Tax

Deduction u/s 80IB(10) - proportionate deduction on the profits of the eligible units - HELD THAT - As decided in own case 2019 (7) TMI 1529 - ITAT PUNE the assessee is not entitled to claim any deduction under section 80IB(10) of the Act in respect of four flats against which there is violation of clauses (e) and (f) of Section 80IB(10) of the Act. However, the assessee is entitled to claim proportionate deduction in respect of balance flats sold by the assessee in the aforesaid housing project. Upholding the order of the CIT(A), we dismiss the ground of appeal raised by the Revenue

Summary

Issues involved:
1. Entitlement to proportionate deduction under section 80IB(10) of the Income Tax Act, 1961.

Analysis:
The appeal before the Appellate Tribunal ITAT Pune revolved around the entitlement of the assessee to a proportionate deduction on the profits of eligible units in compliance with section 80IB(10) of the Income Tax Act, 1961. The assessee, a firm engaged in real estate business, had claimed a deduction under this section, which was disallowed by the Assessing Officer due to non-compliance with the specified conditions. The Ld. AR for the assessee contended that a similar issue had been decided in favor of the assessee in a previous case before the Pune Bench of the Tribunal for the assessment year 2012-13, where proportionate deduction was allowed. The Ld. DR representing the Revenue conceded to this submission.

Upon considering the previous decision of the Tribunal in the assessee's own case for the assessment year 2012-13, the Appellate Tribunal noted that the issue was similar and that the assessee was entitled to a proportionate deduction in respect of the eligible units. The Tribunal upheld the order of the CIT(A) and dismissed the appeal raised by the Revenue. The Ld. CIT(Appeals) had also acknowledged that the issue had been consistently decided in favor of the assessee in various Tribunal decisions, establishing that the assessee was entitled to the proportionate deduction under section 80IB(10) of the Act.

Both parties agreed that the facts and circumstances of the current appeal were identical to the previous case, and therefore, the Tribunal, based on the principle of same parity of reasoning, upheld the findings of the Ld. CIT(Appeals) and sustained the relief provided to the assessee. Consequently, the appeal of the Revenue was dismissed, and the order to grant the proportionate deduction to the assessee was pronounced on July 6, 2021.