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2023 (9) TMI 589 - AT - Income TaxDeduction u/s. 80IB(10) - proportionate deduction - assessee is carrying on slum rehabilitation project - assessee has claimed deduction which includes three flats which was allotted to one single person - HELD THAT - We observe from the record that on similar facts on record the Coordinate Bench 2018 (1) TMI 1646 - ITAT MUMBAI has considered the similar facts on record and adjudicated that assessee should be given proportionate basis of deduction on the other eligible business. We are inclined to grant relief to the assessee in this assessment year which is being the second year of claim of deduction by the assessee. Accordingly, we direct the AO to allow proportionate claim of the assessee u/s. 80IB(10) of the Act eliminating the three (3) flats allotted to Mr. Dwarkanath Tewari.
Issues Involved:
1. Condonation of delay in filing the appeal. 2. Deduction u/s 80IB(10) of the Income Tax Act, 1961. Condonation of Delay: At the outset, we observe that the present appeals are filed by the assessee with a delay of 117 days and assessee also filed an affidavit in this regard and prayed for condonation of delay. Assessee filed an affidavit dated 21.02.2018 and submitted reasons for the delay, including the absence of a senior accountant and inadvertent omission. The Ld. DR objected for the condonation of delay but did not file any submissions against the affidavit. Considered the submissions of both parties, we observe that in the case of M/s. Midas Polymer Compounds Pvt. Ltd., v. ACIT, the Coordinate Bench of the Tribunal condoned a delay of 2819 days by following various judicial precedents, including the decision of the Hon'ble Supreme Court in the case of Collector, Land Acquisition v. Mst Katiji and ors. (167 ITR 471). Respectfully following the above said decision and for the sake of overall justice, we condone the delay and admit the appeals for adjudication. Deduction u/s 80IB(10):Since the issues raised in both these appeals are identical, these appeals are clubbed, heard, and disposed of by this consolidated order. The assessee filed its return declaring total income of Rs. NIL under normal provisions and declared Rs. 1,37,00,520/- u/s 115JB of the Act. The case was selected for scrutiny, and notices u/s 143(2) and 142(1) were issued and served on the assessee. The assessee is engaged in the business of construction and development and claimed deduction u/s 80IB(10) of the Act for profits earned from an SRA project. The Assessing Officer observed that the assessee allotted three flats to Mr. Dwarkanath Tewari, violating clause (f) of section 80IB(10) of the Act. The AO disallowed the deduction, stating that the Income-tax Act does not allow such deduction on a pro-rata basis. The Ld.CIT(A) upheld the AO's decision, relying on findings from the preceding assessment year. Aggrieved, the assessee appealed, arguing that disallowance should be made on a proportionate basis. The Coordinate Bench in the assessee's own case for the A.Y. 2011-12 decided the issue in favor of the assessee, allowing proportionate deduction. Considered the rival submissions and material placed on record, we observe that the assessee is carrying on a slum rehabilitation project and has claimed deduction u/s 80IB(10) of the Act. The Coordinate Bench has previously adjudicated that the assessee should be given a proportionate basis of deduction on other eligible business. Respectfully following the above said decision, we direct the Assessing Officer to allow a proportionate claim of the assessee u/s 80IB(10) of the Act, eliminating the three flats allotted to Mr. Dwarkanath Tewari. In the result, both appeals filed by the assessee are allowed. Order pronounced in the open court on 20th April, 2023.
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