TaxTMI 
TaxTMI 
2011 (12) TMI 247
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....ulfills the requisite conditions given under sub clause (b) of sub section (7) of section 80IB whereby deduction should have been allowed @ 30% of the profit as the requisite certificate/approval was duly given by the prescribed authority under Rule-18BBC(1) of the Income Tax Rules-1962, since initial year. (6) BECAUSE the appellant has been issued certificate/approval by Director General, Tourism, who is a 'Prescribed Authority' under the Act, vide order dated 11.11.2002, wherein the appellant was duly recognized to seek, claim for exemption/benefits under section 80HHD and 80IB(7)(b) of the Income Tax Act, 1961 w.e.f. date of commencement of the hotel business i.e. 03.04.2000 and such certificate/order was duly available in the records of the department, the Assessing Officer should have allowed the deduction under section 80IB(7)(b) @ 30% of the profit derived from Hotel Business. (7) BECAUSE the Ld. CIT (Appeal) as well as Assessing Officer has erred in law and on facts in denying the whole of deduction claimed by the appellant under section 80IB on the ground that claim for deduction of 50% as per section 80IB(7)(a) can not be given as the requisite approval ....
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....provisions and in the absence of any statutory provision, the Appellate Authority is vested with all the plenary powers which the subordinate authority may have in the matter. Therefore, the additional grounds be admitted and be adjudicated on merits. 5. The ld. D.R. has strongly opposed the admission of additional grounds for the reason that the claim of the assessee under section 80IB(7)(b) of the Act was neither raised before the Assessing Officer nor the ld. CIT(A). However, the assessee for the first time has raised this issue before the Tribunal which requires proper verification of facts. Therefore, the additional grounds cannot be admitted. 6. Having heard the rival submissions and from a careful personal of the orders of the authorities below and the documents placed on record, we find that undisputedly the assessee has raised a claim for deduction under section 80IB(7)(a) of the Act before the Assessing Officer. It is also a fact that the assessee has filed approval for exemption under section 80IB(7)(b) of the Act obtained from the Department of Tourism, but no claim in this regard was raised. The reason for not raising this claim under clause (b) was obvious as th....
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....the view that it was the duty of the Assessing Officer to examine the claim of the assessee under section 80IB(7)(b) of the Act in the light of the documents filed before him. Therefore, we are of the view that the additional grounds should be admitted and be adjudicated upon. Accordingly we admit the additional grounds and would adjudicate it along with the main grounds of appeal. 9. The facts in nutshell with regard to the controversy involved in this appeal are that the assessee-company is engaged in the business of running hotel in the name and style "La Place Park Inn". The assessee claimed deduction of Rs. 31,20,198 under section 80IB(7)(a) of the Act which is 50% of the business profit of Rs. 62,40,395. The claim of deduction was denied by the Assessing Officer on the ground that the assessee could not obtain approval from the prescribed authorities as envisaged in section 80IB(7)(a) of the Act read with Rule 18BBC of the Income-tax Rule (hereinafter called as the Rule). 10. The assessee preferred an appeal before the ld. CIT(A) but did not find favour with him. 11. Now the assessee is in appeal before the Tribunal with the submission that the assessee has already a....
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..... CIT [2006] 284 ITR 323/157 Taxman 1. 15. In rebuttal, the ld. counsel for the assessee has submitted that the Hon'ble Delhi High Court in the case of CIT v. Jai Parabolic Springs Ltd. [2008] 306 ITR 42/172 Taxman 258 after examining the judgment of Hon'ble Apex court in the case of Goetze (India) Ltd. (supra) has held that there is no prohibition on the powers of the Tribunal to entertain additional ground which according to the Tribunal arose in the matter for the just decision of the case. While dealing with the issue, their Lordships have also examined the judgments of the Hon'ble Apex Court in the cases of Jute Corpn. India Ltd. (supra) and National Thermal Power Corporation Co. (supra). 16. The ld. D.R. has also invited our attention to the provisions of sections 80IB(7)(a) and 80IB(7)(b) of the Act with the submission that the approval for exemption under sections 80IB(7)(a) and 80IB(7)(b) of the Act are to be allowed to the Hotels considering the localities where they are situated and the assessee is entitled to raise only one claim at a time. Since the assessee has raised a claim for deduction under section 80IB(7)(a) of the Act, its alternative claim for deduction ....
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....7 and ending on the 31st day of March, 2001, it would be entitled for deduction @ 50% of the profit and gains derived from business of such Hotel for a period of 10 consecutive years beginning from the initial assessment year subject to fulfillment of certain conditions. The other Hotels which are located in any other place other than those mentioned in clause (a) of sub-section (7) of section 80IB of the Act and started its functioning during the period beginning on the 1st day of April, 1991 and ending on the 31st day of March, 1995 or beginning on the 1st day of April, 1997 and ending on the 31st day of March, 2001, it would be entitled for deduction @ 30% of the profit and gains derived from the business of such Hotel for 10 consecutive years beginning from the initial assessment year subject to the approval of the prescribed authority. 20. In both the cases the prescribed authorities are different. Under Rule 18BBC of the Rule, the prescribed authorities are defined and for clause (a) of sub-section (7) of section 80IB of the Act, the prescribed authority shall be the Director General Income Tax (Exemption) who shall grant approval on the concurrence of the Director General....
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....oning at any time during the period beginning on the 1st day of April 1991 and ending on the 31st day of March, 1995 or beginning on the 1st day of April, 1997 and ending on the 31st day of March, 2001: Provided that nothing contained in this clause shall apply to a hotel located at a place within the municipal jurisdiction (whether known as a municipality, municipal corporation, notified area committee; town area committee or a cantonment board or by any other name) of Calcutta, Chennai, Delhi or Mumbai, which has started or starts functioning on or after the 1st day of April, 1997 and before the 31st day of March, 2001" 21. From the bare reading of the aforesaid clauses (a) and (b) of sub-section (7) of section 80IB, we find that the percentage of deductions is different depending upon the area where the hotel is situated. Therefore, it cannot be said that if deduction under clause (a) is not allowed it should be allowed under clause (b). Both types of hotels are located in different places. Therefore, verification is required by the authorities concerned before allowing any deduction. In the instant case, approval under section 80IB(7)(b) has already been obtained by the a....