High Court Upholds Tribunal Decision on Tax Appeal for Housing Project Units

The High Court dismissed the Tax Case Appeal, upholding the Income Tax Appellate Tribunal's decision to allow deduction under Section 80IB(10) for units in a housing project exceeding 1500 sq.ft. The Court found the Tribunal's decision consistent with previous rulings, rejecting the appellant's argument that all units must not exceed 1500 sq.ft. for the deduction to apply. The Court ruled in favor of the assessee, stating that the law does not prohibit deduction if some units exceed the specified dimensions, based on the precedent set by the Division Bench's ruling.

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Issues involved:
Challenge to order passed by Income Tax Appellate Tribunal regarding deduction under Section 80IB(10) for units in a housing project exceeding 1500 sq.ft.

Analysis:
The Revenue challenged the order passed by the Income Tax Appellate Tribunal regarding the allowance of proportionate deduction under Section 80IB(10) for units in a housing project exceeding 1500 sq.ft. The substantial question of law raised was whether the Tribunal was correct in allowing deduction for units less than 1500 sq.ft. when the project contained units exceeding 1500 sq.ft. The appellant contended that the Tribunal erred in denying deduction for the larger units while allowing it for smaller units, arguing that all units in the project must not exceed 1500 sq.ft. for the deduction to apply. On the other hand, the respondent argued that the Tribunal's decision was in line with previous court rulings, emphasizing that the law does not prohibit deduction if some units exceed the specified dimensions.

The High Court considered the arguments presented by both parties and referred to a previous decision in a similar case. The Court found that the Tribunal's decision was legally sound and consistent with past judgments. The Court held that the appellant's contentions were not valid, and the question of law was answered against the Revenue and in favor of the assessee. Consequently, the Tax Case Appeal was dismissed based on the precedent set by the Division Bench's ruling. Both the senior standing counsel for the appellant and the counsel for the respondent acknowledged that the issue was covered by the Division Bench's decision, leading to the dismissal of the appeal. The Court concluded that the question of law was decided against the Revenue and in favor of the assessee, following the precedent established by the Division Bench's judgment.

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