2022 (2) TMI 859 - AT - Income Tax

Deduction u/s 80IB(10) - pro-rata deduction - few of units satisfying the conditions - HELD THAT - Respectfully following the decisions of CIT v. Arun Excello Foundations (P.) Ltd. 2012 (10) TMI 1216 - MADRAS HIGH COURT as well as decision of the Coordinate Benches of the Tribunal in the case of Elegant Estates 2016 (1) TMI 502 - MADRAS HIGH COURT the ld. CIT(A) has rightly directed the Assessing Officer to work out the pro-rata deduction in respect of units satisfying the conditions under section 80IB(10) of the Act and allow the claim of deduction. Thus, we find no infirmity in the order passed by the ld. CIT(A).

Summary

Issues:
Appeals against orders of the Commissioner of Income Tax for assessment years 2014-15 and 2013-14.

Analysis:
1. The appeals were filed by the Revenue against orders of the Commissioner of Income Tax for different assessment years. The assessee claimed a deduction under section 80IB of the Income Tax Act, 1961. The Assessing Officer rejected the deduction claim, leading to an appeal by the assessee.

2. The Commissioner of Income Tax (Appeals) directed the Assessing Officer to calculate the pro-rata deduction for units meeting section 80IB(10) conditions. The Revenue argued that the construction agreement date was crucial, and the assessee was attempting to benefit from post-amendment provisions. The assessee, supported by case law, defended the Commissioner's decision.

3. The Tribunal analyzed the facts, noting discrepancies in the Department's contentions regarding the construction agreement date. Referring to case law, the Tribunal emphasized the liberal interpretation of section 80IB(10) and upheld the Commissioner's decision. The Tribunal cited precedents where similar deductions were allowed proportionately despite technical violations.

4. The Tribunal highlighted the decisions of the Jurisdictional High Court and the Coordinate Benches, affirming the allowance of deductions in similar cases. The Tribunal dismissed the Revenue's appeals for both assessment years, maintaining the direction to calculate pro-rata deductions for units meeting the specified conditions under section 80IB(10) of the Act.

5. The Tribunal's decision was based on consistent judicial interpretations favoring a liberal approach towards deduction provisions. The Tribunal's reliance on precedent cases and the legislative intent behind section 80IB(10) supported the allowance of deductions in the present case. The appeals by the Revenue were ultimately dismissed, affirming the Commissioner's orders for both assessment years.