2016 (11) TMI 1758 - HC - Income Tax

Method of accounting adopted by the assessee for the concerned assessment year - HELD THAT - Though the AO had rejected the assessee s explanation, concurrently the Appellate Authorities i.e. the CIT(A) and ITAT ruled in its favour. This Court also notices that the ITAT s ruling is based upon several previous judgments on this Court and is also based on rule of consistency vis-a-vis the previous years. Therefore, no question of law arises. Applicability of deduction u/s 80(IB)(10) - As ITAT has remitted the matter for factual determination by the CIT(A). In this circumstances, no questions of law on that account arises.

Summary

Issues involved:
1. Method of accounting adopted by the assessee for the assessment year.
2. Applicability of deduction under Section 80(IB)(10).

Analysis:

Issue 1: Method of accounting
The Revenue raised questions regarding the method of accounting adopted by the assessee for the assessment year. The Assessing Officer had initially rejected the assessee's explanation, but both the Commissioner of Income Tax (Appeals) [CIT(A)] and the Income Tax Appellate Tribunal (ITAT) ruled in favor of the assessee. The High Court observed that the ITAT's decision was based on previous judgments and the rule of consistency with previous years. Consequently, the High Court concluded that no question of law arose in this regard, leading to the dismissal of the appeal.

Issue 2: Applicability of deduction under Section 80(IB)(10)
The second issue raised was the applicability of deduction under Section 80(IB)(10). The ITAT had referred this matter back to the CIT(A) for factual determination. The High Court noted this and concluded that since the issue was remitted for factual determination, there were no questions of law arising from this aspect. As a result, the appeal was dismissed by the High Court.

In summary, the High Court dismissed the appeal as no questions of law were found to arise regarding the method of accounting adopted by the assessee for the assessment year, and the applicability of deduction under Section 80(IB)(10) was remitted for factual determination by the CIT(A).