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2018 (2) TMI 518 - HC - Income TaxClaiming deduction u/s. 80IB (10) - whether disallowance under Section 40(a)(ia) cannot be regarded as increase in profit of the assessee s business on which deduction u/s 80IC would be allowable? - Held that - Tribunal had held that the disallowance was not justified. The Revenue complained that the Tribunal was not justified and failed to appreciate that this disallowance under Section 40(a)(ia) cannot be regarded as increase in profit of the assessee s business on which deduction under Section 80IC would be allowable. In the opinion of the Revenue, that amount has already been expended. We do not see how such a question arises in these Appeals. We have already held above that the substantial questions of law in these Appeals revolve around interpretation of Section 80IB( 10) of the Income Tax Act We have already held above that the substantial questions of law in these Appeals revolve around interpretation of Section 80IB( 10). We see no justification, therefore, for the Revenue seeking assistance of an order of admission in a distinct case (M/s. Lipid Technologies (2018 (2) TMI 351 - BOMBAY HIGH COURT). Therefore, Mr. Tejveer Singh s contentions with regard to this order being applicable to the facts of the present case deserve to be rejected. The contentions are therefore rejected.
Issues involved:
1. Interpretation of Section 80IB(10) of the Income Tax Act regarding deduction eligibility. 2. Application of Development Control Rules (DCR) in relation to approved construction plans. 3. Applicability of Section 40(a)(ia) and Section 194C of the Income Tax Act. Analysis: 1. The judgment addresses multiple appeals challenging the orders of the Income Tax Appellate Tribunal (ITAT) regarding deduction claims under Section 80IB(10) of the Income Tax Act for different assessment years. The primary contention revolves around whether the conditions for claiming the deduction were met, specifically related to the size of the plot, completion of the project, and adherence to the approved plan. The Tribunal upheld the deduction, relying on past decisions and precedents. The High Court dismissed the Revenue's appeals, citing consistency with previous judgments that addressed similar issues. 2. The issue of compliance with Development Control Rules (DCR) in relation to approved construction plans was raised by the Revenue. The argument presented was that construction not in accordance with the approved plan should not qualify for the deduction under Section 80IB(10). The Court disagreed with this interpretation, emphasizing that adherence to DCR does not necessarily imply compliance with the approved plan. The Court highlighted the distinction between DCR and approved construction plans, affirming the Tribunal's decision to allow the deduction based on the overall assessment of the case. 3. Another aspect of the judgment dealt with the applicability of Section 40(a)(ia) and Section 194C of the Income Tax Act. The Revenue contended that if the firm is not eligible for deduction under Section 80IB(10), payments should be covered under Section 194C. However, the Court rejected this argument, stating that the substantial questions of law in the appeals were centered on the interpretation of Section 80IB(10) specifically. The Court clarified that the issues raised did not align with the concerns related to Section 40(a)(ia) as raised in a different case, emphasizing the relevance of the specific provisions and deductions under consideration. In conclusion, the High Court upheld the decisions of the ITAT regarding deduction claims under Section 80IB(10), emphasizing consistency with past judgments and rejecting the Revenue's contentions on various grounds. The judgment provides a detailed analysis of the legal interpretations and precedents applied in resolving the issues raised in the appeals.
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