Tribunal allows deductions for compliant transactions, upholds disallowance for violations, and permits deduction for additional income.

The Tribunal allowed proportionate deduction for compliant transactions, upheld disallowance for violations under sec. 80-IB(10)(c), and permitted deduction for additional income under sec. 80-IB(10). The appeals for both assessment years were partly allowed for the assessee and dismissed for the revenue.

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Issues:
Cross appeals against the common order of CIT(A)-VI, Bangalore for assessment years 2010-11 and 2011-12 regarding deduction u/s 80-IB(10) of the Income-tax Act, 1961.

Analysis:
1. Assessment Year 2010-11:
- The assessee, a property development firm, claimed deduction u/s 80-IB(10) for its income. The AO found violations of sec. 80-IB(10)(c), (e), and (f), denying the deduction.
- The CIT(A) upheld the violations but directed proportionate deduction. The assessee sought full deduction, arguing against the retrospective application of clauses (e) and (f).
- The Tribunal found violations in the sale of 10 flats, but clauses (e) and (f) applied only post-2010. Citing precedents, it allowed proportionate deduction for compliant transactions.
- The Tribunal confirmed the CIT(A)'s decision on proportionate disallowance for post-2010 transactions and violations under sec. 80-IB(10)(c).

2. Additional Income Issue (2010-11):
- The AO treated on-money received as business income. The CIT(A) disallowed deduction u/s 80-IB(10) based on sec. 80A(5) introduced retrospectively.
- The Tribunal held that sec. 80A(5) doesn't bar quantification of deduction, allowing deduction for the additional income under sec. 80-IB(10).

3. Assessment Year 2011-12:
- The appeal focused on the applicability of sec. 80-IB(10)(e) and (f). Following the decision for 2010-11, the Tribunal partly allowed the assessee's appeal and dismissed the revenue's appeal for both years.

In conclusion, the Tribunal allowed proportionate deduction for compliant transactions, upheld disallowance for violations under sec. 80-IB(10)(c), and permitted deduction for additional income under sec. 80-IB(10). The appeals for both assessment years were partly allowed for the assessee and dismissed for the revenue.

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