Tribunal allows appeals for reassessment years, assessee complies with audit report requirement, claim under sec. 80-IB allowed.

The Tribunal allowed the appeals filed by the assessee for Assessment Years 2003-04 and 2004-05, as the assessee fulfilled the requirement of filing the audit report during reassessment proceedings under sec. 147. This led to the deletion of the disallowance of the claim under sec. 80-IB. Challenges to the validity of proceedings under sec. 147 and the assessment were considered unnecessary given the favorable decision on the main issue.

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Issues Involved:
The judgment involves the disallowance of the assessee's claim of deduction under sec. 80IB for not furnishing the audit report in Form 10CCB along with the return of income filed by the assessee for Assessment Years 2003-04 and 2004-05.

Assessment Year 2003-04:
The assessee's claim of deduction under sec. 80-IB was disallowed by the Assessing Officer as the audit report in Form No.10CCB was not furnished along with the return of income. The CIT(A) upheld this disallowance stating that sec. 80-IB mandates the audit report to be furnished along with the return of income, and failure to do so cannot be considered a curable defect. The assessee argued that filing the audit report during assessment proceedings is sufficient, citing precedents where similar requirements were considered directory rather than mandatory. The Tribunal held that the assessee had satisfied the condition by filing the audit report during the reassessment proceedings under sec. 147, deleting the disallowance of the claim under sec. 80-IB.

Assessment Year 2004-05:
Similar to the previous year, the assessee's claim of deduction under sec. 80-IB was disallowed in the reassessment as the audit report in Form 10CCB was not enclosed with the original return of income. The CIT(A) upheld this disallowance based on the same grounds as in the previous year. The assessee contended that the audit report filing requirement is directory and not mandatory, citing relevant court decisions. The Tribunal, considering the precedents and the filing of the audit report during the reassessment proceedings, held that the assessee had fulfilled the condition for claiming deduction under sec. 80-IB, thereby allowing the appeals filed by the assessee.

Conclusion:
The Tribunal allowed the appeals filed by the assessee for both Assessment Years 2003-04 and 2004-05, as the assessee had satisfied the condition of filing the audit report during the reassessment proceedings under sec. 147, thereby deleting the disallowance of the claim under sec. 80-IB. Other grounds challenging the validity of proceedings under sec. 147 and the assessment made under the same were deemed redundant in light of the main issue being decided in favor of the assessee.

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