THE COMMISISONER OF INCOME TAX vs. M/S. MAHAVEER TUSCAN

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ITA/18/2013HC KarnatakaKAHC01011852201302 September 2020Bench: ALOK ARADHE,H.T. NARENDRA PRASAD3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court, in line with a related order, answered the substantial questions of law against the revenue and in favour of the assessee. The appellate authorities were deemed correct in their interpretation regarding the eligibility for deduction.

What were the facts?

The revenue appealed against an ITAT order that allowed the assessee firm to claim deduction under Section 80IB(10) for a housing project. The core issue was whether significant deviations from the sanctioned plan disqualified the assessee from this deduction.

What were the issues?

Whether deviations from a sanctioned plan in a housing project disqualify the assessee from claiming deduction under Section 80IB(10), and if the intent of the legislature was met despite such violations.

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 2ND 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.18 OF 2013

BETWEEN:

1.

THE COMMISSIONER OF INCOME-TAX C.R. BUILDING, QUEENS ROAD BANGALORE.

2.

THE INCOME-TAX OFFICER WARD-4(3), C.R. BUILDING QUEENS ROAD, BANGALORE. ... APPELLANTS (BY SRI.K.V.ARAVIND, ADV.,)

AND:

M/S. MAHAVEER TUSCAN NO.1, 24TH MAIN MAHAVEER TOWERS J P NAGAR, 6TH PHASE BANGALORE-560078. ... RESPONDENT (BY SRI.A.SHANKAR, SR. ADV. A/W SRI.M.LAVA, ADV.) - - -

THIS ITA IS FILED UNDER SECTION 260-A OF I.T. ACT, 1961 ARISING OUT OF ORDER DATED 31.08.2012 PASSED IN ITA

NO.996/BANG/2011 FOR THE ASSESSMENT YEARS 2008-09, PRAYING THAT THIS HON’BLE COURT MAY BE PLEASED TO: (I) FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN. (I) ALLOW THE APPEAL AND SET ASIDE THE ORDER DATED 31.08.2012 PASSED BY THE ITAT, BANGALORE IN ITA NO.996/BANG/2011 CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE INCOME TAX OFFICER, WARD-4(3), BANGALORE.

THIS ITA COMING ON FOR FINAL 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 2008-09. The appeal was admitted by a bench of this Court vide order dated 23.09.2013 on the following substantial questions of law:

(i) Whether the appellate authorities were correct in holding that the assessee firm is eligible for deduction under Section 80IB(10) of the Income-Tax Act despite the fact that there was large scale violations and deviations to the sanctioned plan of the local authority by the assessee firm in carrying out the “Housing Project” without appreciating

the fundamental nature of the legislature for providing such relief?

(ii) Whether the appellate authorities were correct in construing that deviations and violations committed by the assessee while undertaking the housing project and yet to be paid compounding fee for regularizing the default is fairly enough to claim the deduction under Section 80IB(10) without appreciating the intended structure of the legislative provisions of Section 80IB?

2.

For the reasons assigned by us in the order passed today in ITA No.13/2013, 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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