ITAT Delhi directs reconsideration of additional grounds for appeal, emphasizes assessing income based on completed units.

The ITAT Delhi set aside the Ld. CIT(A)'s order and directed reconsideration of additional grounds of appeal, emphasizing the importance of assessing income based on completed and sold units. The order stressed the need for consistency in tax proceedings and a comprehensive decision addressing all arguments. The appeal was allowed for statistical purposes.

---

---

Issues:
1. Assessment of income under section 80IB(10) of the Income Tax Act.
2. Denial of deduction claimed by the assessee.
3. Additional grounds of appeal raised by the assessee.
4. Dismissal of additional grounds of appeal by the Ld. CIT(A).
5. Consideration of project completion basis for income determination.
6. Requirement of reconsideration by the Ld. CIT(A).

Analysis:

1. The appeal was against the order of Ld.CIT(Appeals)-Muzaffarnagar for AY 2010-11 concerning the assessment of income under section 80IB(10) of the Income Tax Act. The AO denied the claim of the assessee under this section as the conditions were not satisfied, resulting in the assessment of income at Rs. 6.66 crores.

2. The Ld. CIT(A) noted that the assessee withdrew the appeal regarding the deduction claimed under section 80IB(10) but raised additional grounds. The assessee contended that only completed and sold residential units should be taxed, and the income determination should be based on correct taxable income computed according to law.

3. The assessee argued for the admission of additional grounds, emphasizing the principle that an assessee should be taxed on the correct taxable income. The Ld. CIT(A) dismissed the main ground of appeal as withdrawn and also rejected the additional grounds raised by the assessee.

4. The Ld. Counsel for the assessee argued that the income should only be taxed for completed and sold units, following the completion method of accounting. The matter was considered for reconsideration at the level of the Ld. CIT(A) due to the contentions raised by the assessee regarding the determination of income.

5. The ITAT Delhi held that the Ld. CIT(A) should have considered the additional grounds of appeal raised by the assessee, especially in light of subsequent assessment years where the AO assessed income on a percentage basis. The order emphasized the need for the Ld. CIT(A) to call for a remand report from the AO and decide on the additional grounds after due consideration and hearing.

6. The ITAT Delhi set aside the impugned order and directed the Ld. CIT(A) to reconsider the additional grounds of appeal in accordance with the law, providing sufficient opportunity for both the assessee and the AO to present their arguments. The order highlighted the importance of consistency in income tax proceedings and the need for a speaking order addressing all aspects raised before the authority. The appeal of the assessee was allowed for statistical purposes.

---