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2014 (8) TMI 236 - AT - Income TaxDeduction u/s 10B - Alternative claim u/s 11A Assessee registered with STP as 100% EOU - Development and manufacture of software and IT enabled services Held that - The Tribunal had allowed the claim u/s 10B of the Act, the deduction was not allowable u/s 10B of the Act, however on a review petition directed the claim made be examined u/s 10A of the Act, if the same is allowable, provided conditions of section 10A of the Act are satisfied - also in THE COMMISSIONER OF INCOME TAX Versus REGENCY CREATIONS LTD. 2012 (9) TMI 627 - DELHI HIGH COURT it has been held that the applicant had claimed the benefit of section 10B on the basis of the provisions which pertains to section 10A - Revenue has not raised the contention that assessee has not satisfied the conditions that are required for claiming deduction u/s 10A of the Act nor has the Revenue controverted the findings of the CIT(A) that assessee is entitled to the benefit of deduction u/s 10A of the Act - CIT(A) was justified in granting deduction u/s 10A Decided against Revenue.
Issues involved:
1. Disallowance of deduction under section 10B of the Income Tax Act. 2. Claim for deduction under section 10A of the Income Tax Act. 3. Principles of consistency in allowing deductions. 4. Filing of revised return for claiming deductions. 5. Adjudication of legal claims by Appellate Tribunal. Detailed Analysis: 1. The issue arose when the Assessing Officer denied the benefit of deduction under section 10B of the Income Tax Act to the assessee, a company registered under the Software Technology Parks of India (STPI). The denial was based on the assessee not being registered as stipulated in the relevant clause. This led to an appeal before the CIT(A) challenging the disallowance. 2. The CIT(A) allowed the alternative claim of the assessee for deduction under section 10A of the Act. The CIT(A) reasoned that even though the assessee initially claimed deduction under the wrong section, the eligibility criteria for deduction under section 10A were satisfied. The CIT(A) emphasized the importance of fulfilling all conditions for claiming the exemption under section 10A. 3. The principle of consistency in allowing deductions was highlighted, citing previous assessment years where the claim for deduction under section 10B was accepted by the department. The CIT(A) relied on legal precedents to support the argument that in the absence of any change in facts or law, the principle of consistency should be upheld to support the claim of the assessee. 4. The Assessing Officer contended that the assessee failed to file a revised return to claim deduction under section 10A, which was considered a procedural lapse. However, the Tribunal emphasized that the onus lies on the assessee to make the right claim within the framework of the law. The Tribunal referred to legal judgments stating that technicalities should not compel the assessee to pay more tax than due. 5. The Tribunal, after considering the submissions and material on record, upheld the CIT(A) order granting deduction under section 10A of the Act to the assessee. The Tribunal noted that the disputed issue was covered by previous judgments and that the conditions for claiming the deduction were satisfied by the assessee. Consequently, the appeal of the Revenue was dismissed, affirming the allowance of deduction under section 10A for the assessee.
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