Appellate Tribunal allows Revenue's appeal on deduction; Assessing Officer may amend order pending higher authorities' decision.

The Appellate Tribunal allowed the Revenue's appeal challenging the deduction claimed by the assessee under section 80IA(4)(iii) of the Income Tax Act for the Assessment Year 2004-05. The Tribunal acknowledged the previous unfavorable decision but noted the High Court's admission of substantial questions of law, indicating a potential reversal in the future. Consequently, the Tribunal directed the Assessing Officer to amend the order if the issue is decided in favor of the assessee by higher authorities.

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Issues:
Allowability of deduction u/s. 80IA(4)(iii) of the I.T. Act for the Assessment Year 2004-05.

Analysis:
The appeal filed by the Revenue challenged the order of the CIT(A) allowing the deduction claimed by the assessee u/s. 80IA(4)(iii) of the I.T. Act. The assessee, a limited company engaged in the Development and Construction of an Industrial Park and sale of Properties, claimed a deduction of &8377;10,74,83,088/- under section 80IA(4)(iii) for the relevant assessment year. The Assessing Officer, during assessment proceedings, found non-compliance with the requirements of section 80IA(4)(iii) and denied the deduction, stating that if allowed later, certain incomes should be considered ineligible for computation. The CIT(A) reversed this decision, allowing the deduction claimed by the assessee.

The Revenue raised several grounds of appeal before the Appellate Tribunal. The first ground questioned the allowance of deduction when no notification existed at the time of assessment, citing a notification issued after the assessment date. The second ground challenged the eligibility of the assessee for deduction due to non-fulfillment of specific conditions in the notification. The third ground referred to the non-consideration of previous decisions by the ITAT for the A.Y. 2003-04. The fourth and fifth grounds raised issues regarding the completion certificate and eligibility for deduction on rental income, respectively.

The Tribunal noted that the issue had been previously decided against the assessee by the Tribunal for A.Y. 2003-04. However, the High Court had admitted substantial questions of law related to the case. Considering this, the Tribunal directed the Assessing Officer to amend the order if the issue is decided in favor of the assessee by higher authorities in the future. Consequently, the grounds raised by the Revenue were allowed, and the appeal filed by the Revenue was allowed.

In conclusion, the Tribunal's decision revolved around the allowability of deduction u/s. 80IA(4)(iii) of the I.T. Act for the Assessment Year 2004-05. Despite the previous unfavorable decision by the Tribunal, the High Court's admission of substantial questions of law indicated a potential reversal of the decision in the future, prompting the Tribunal to direct the Assessing Officer to amend the order accordingly.

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