2011 (10) TMI 681 - AT - Income Tax

Appellate Tribunal allows Assessee's appeal on deduction, audit report filing not mandatory

Hanuman Filaments Pvt. Ltd. Versus Dy. CIT Circle-1 Surat

The Appellate Tribunal ITAT Ahmedabad allowed the appeal of the Assessee, reversing the disallowance of deduction u/s.80IB(4). The Tribunal held that ... - Issues involved: Appeal against sustaining disallowance of deduction u/s.80IB(4) and interest charged u/s.234B of Income Tax Act, 1961.Issue 1: Disallowance of deduction u/s.80IB(4):The assessee claimed a deduction u/s.80-IB(4) but failed to furnish the Audit Report on the prescribed form. The Assessing Officer rejected the claim primarily due to this reason. The first appellate authority affirmed this decision, stating that the time limit for revision of the return had lapsed, rendering the late submission of the Audit Report inconsequential. However, since the Audit Report was furnished during the assessment proceedings, the Tribunal reversed the findings of the authorities below, citing precedents that filing the audit report along with the return was not mandatory but directory. The Tribunal directed to allow the claim to the extent it was admissible as per law, ultimately allowing the appeal of the Assessee.Issue 2: Interest charged u/s.234B:The Hon'ble C.I.T. (A) sustained the interest charged u/s.234B of the Income Tax Act, 1961. The specific grounds for this decision were not elaborated in the provided summary of the judgment.Conclusion:The Appellate Tribunal ITAT Ahmedabad allowed the appeal of the Assessee, reversing the disallowance of deduction u/s.80IB(4) and potentially addressing the issue of interest charged u/s.234B, although details on the latter were not explicitly mentioned in the summary provided.