2019 (4) TMI 1387 - HC - Income Tax

Deduction u/s 80IB(10) in respect of redevelopment project - not eligible for deduction in view of the board instructions under Section 119 - Tribunal allowed claim - HELD THAT - In case of assessee in the earlier assessment year on identical question held that Commissioner Appeals in his judgment has specifically observed that the project of the assessee is approved as slum rehabilitation project by slum rehabilitation authority of the State and the same has also been notified. The assessee has submitted the project and the plan dated 28/04/2004 and the same was approved by the Rehabilitation Authority on 04/06/2004, the same is filed on record. The Tribunal has also considered the said aspect, so also proviso to Section 80IB(10) of the Act and has correctly passed the order. The judgment of the Tribunal cannot be faulted with.

Summary

Issues involved: Challenge to judgment of Income Tax Appellate Tribunal regarding deduction under section 80IB (10) of the Income Tax Act for profit derived from development of residential building, interpretation of proviso to clause (a) and (b) of section 80 IB (10), project approval by Slum Rehabilitation Authority, and applicability of Notification No.2 of 2011.

Analysis:

1. The main issue before the court was whether the Income Tax Appellate Tribunal was correct in upholding the order of the CIT (A) allowing a deduction under section 80IB (10) of the Income Tax Act for the profit derived from the development of a residential building. The question raised was whether the assessee was covered by the proviso to clause (a) and (b) of section 80 IB (10) despite the project approval by the Slum Rehabilitation Authority not falling within the period of approval as per Notification No.2 of 2011.

2. The learned counsel for the revenue highlighted a previous assessment year's case where a similar question was raised, and the court dismissed the appeal in that case. The court noted that the Commissioner [Appeals] had observed that the project of the assessee was approved as a slum rehabilitation project by the state's authority and was duly notified. The Tribunal had considered this aspect along with the proviso to Section 80IB(10) of the Act and made a correct decision. The court found no fault with the Tribunal's judgment and dismissed the appeal without interference.

3. The court, without recording separate reasons, dismissed the current appeal based on the facts and circumstances presented in the case. The judgment of the Tribunal was upheld, and no costs were awarded in this matter.

In conclusion, the court upheld the decision of the Income Tax Appellate Tribunal regarding the deduction under section 80IB (10) of the Income Tax Act for profit derived from a residential building development project, considering the approval by the Slum Rehabilitation Authority and the relevant legal provisions.