THE COMMISSIONER OF INCOME-TAX vs. M/S. MANDAVI BUILDERS

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ITA/317/2015HC KarnatakaKAHC01034613201522 September 2020Bench: ALOK ARADHE,H.T. NARENDRA PRASAD3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court, following a related order, answered the substantial questions of law against the revenue and in favour of the assessee. The Tribunal's decision allowing the deduction was upheld.

What were the facts?

The Revenue appealed against an ITAT order concerning the Assessment Year 2011-12. The appeal questioned whether unaccounted money found during search and explained as 'on money' was eligible for deduction under Section 80IB(10). It also questioned the eligibility of transactions with buyers for deduction despite violations of sub-sections (e) and (f) of Section 80IB(10).

What were the issues?

Whether unaccounted 'on money' is eligible for deduction under Section 80IB(10) and whether transactions violating Section 80IB(10) are eligible for deduction if entered into before amendments.

Which sections of the Income-tax Act were involved?

Section 80IB(10)

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 22ND DAY OF SEPTEMBER 2020

PRESENT

THE HON’BLE MR. JUSTICE ALOK ARADHE

AND

THE HON’BLE MR. JUSTICE H.T.NARENDRA PRASAD

I.T.A. NO.317/2015 BETWEEN

1.

THE COMMISSIONER OF INCOME-TAX CENTRAL CIRCLE, C.R. BUILDING QUEENS ROAD, MANGALORE-575001.

2.

THE DEPUTY COMMISSIONER OF INCOME TAX

CENTRAL CIRCLE, C.R. BUILDING

ATTAVARA, MANGALORE-575001.

... APPELLANTS (BY SRI. K.V. ARAVIND, ADV.,)

AND:

M/S. MANDAVI BUILDERS MANDAVI PALACE, END POINT ROAD MANIPAL, UDUPI-576104 PAN: AAOFM 0540 P. ... RESPONDENT (BY SRI. A. SHANKAR, SR. COUNSEL A/W SRI. M. LAVA, ADV.) - - -

THIS ITA IS FILED UNDER SECTION 260-A OF I.T. ACT, 1961 ARISING OUT OF ORDER DATED 20.02.2015 PASSED IN ITA NO.1787/BANG/2013 FOR THE ASSESSMENT YEAR 2011-12, PRAYING THAT THIS HON’BLE COURT MAY BE PLEASED TO: (I) FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.

(II) ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE ITAT, BANGALORE IN ITA NO.1787/BANG/2013 DATED 20-02-2015 CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE, MANGALORE.

THIS ITA COMING ON FOR FURTHER HEARING, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING:

JUDGMENT

This appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act for short) has been preferred by the revenue. The subject matter of the appeal pertains to the Assessment year 2011-12. The appeal was admitted by a bench of this Court vide order dated 31.05.2016 on the following substantial questions of law: (i) Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that, unaccounted money, found during the search proceedings and explained as on money received, are eligible for deduction under Section 80IB(10) of the Act?

(ii) Whether, on the facts and in the

circumstances of the case, that the Tribunal was right in holding that, transactions entered into, with the buyers of flats, are eligible for deduction, even though there is violation of the sub-Sections(e) and (f) of Section 80IB(10), on the ground that these transactions were entered into before the amendments to sub-Section (3) and (f) of Section 80IB(10)?

2.

For the reasons assigned by us in the order passed today in I.T.A.No.307/2015, the substantial questions of law are answered against the revenue and in favour of the assessee.

In the result, the appeal fails and is hereby dismissed.

Sd/- JUDGE

Sd/- JUDGE ss

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