ITAT grants deductions under Section 80IC, allows audit report submission during assessment. Assessee entitled to 100% deduction for substantial expansion.

The ITAT allowed the appeal of the assessee, granting deductions under Section 80IC for both the non-filing of Form No. 10CCB and the substantial expansion of the unit. The ITAT held that the audit report submission with the return is not mandatory and can be submitted during assessment proceedings. Additionally, the ITAT ruled that the assessee was entitled to claim 100% deduction for substantial expansion for five years within the 10-year period, based on legal precedents and provisions cited during the proceedings.

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Issues involved:
1. Disallowance of deduction under Section 80IC for non-filing of Form No. 10CCB.
2. Denial of deduction under Section 80IC @ 100% for substantial expansion of the unit.

Analysis:

Issue 1: Disallowance of deduction under Section 80IC for non-filing of Form No. 10CCB
The assessee claimed a deduction under Section 80IC but the Assessing Officer disallowed it due to non-filing of Form No. 10CCB. The CIT(A) upheld this decision. However, the assessee argued that the form was filed during the assessment proceedings and relied on a High Court decision. The ITAT held that the audit report submission with the return is not mandatory, and it can be submitted during assessment proceedings. Citing the High Court decision, the ITAT ruled in favor of the assessee, allowing the deduction under Section 80IC.

Issue 2: Denial of deduction under Section 80IC @ 100% for substantial expansion of the unit
The CIT(A) restricted the deduction under Section 80IC to 25% instead of the 100% claimed by the assessee for substantial expansion of the unit. The assessee referred to a Supreme Court decision in their favor. The ITAT confirmed that the Supreme Court decision allowed 100% deduction for substantial expansion within the 10-year period. The ITAT analyzed the Supreme Court's findings and concluded that the assessee was entitled to claim 100% deduction for five years from the initial year of substantial expansion, within the 10-year deduction period. The ITAT ruled in favor of the assessee, allowing the deduction at 100% for the substantial expansion period.

In conclusion, the ITAT allowed the appeal of the assessee, granting the deductions under Section 80IC for both the non-filing of Form No. 10CCB and the substantial expansion of the unit, based on the legal precedents and provisions cited during the proceedings.

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