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Deduction is allowable on the gross total income.
Deduction is allowable on the gross total income.
Real estate dealer earns a profit of Rs.71,99,25,721 fom its development and building of a project under the name of Oberoi woods and claimed deduction on it. AO restricted the deduction amount to Rs.68,18,56,583 as it is the profit from business and profession. CIT(A) allowed deduction on assessee's claim. Since, difference amount is part of assesee's gross total income and AO escaped it. Thus, ITAT upheld CIT(A).-501846
1. M/s. Oberoi Realty Ltd. is the assessee company engaged in the business of real estate and construction or development of buildings.
2. It earned profit of Rs. 71,99,25,721 from its development and building project and claimed deduction it.
3. AO restricted the deduction amount to Rs. 68,18,56,583 as it is only profit from the business and profession.
4. Thus, AO assessed assessee's income at Rs. Rs.14,36,67,009/- instead of Rs.10,59,17,950/-
5. CIT(A) allowed deduction as per assessee's claim as it is the assessee's total gross income which AO escaped to calculate and is eligible for deduction under the section 80(b) (of Income Tax Act, 1961).
6. HELD- ITAT agreed with the orders of CIT(A) and dismissed revenue's appeal.[In favour of Assessee]
Case Reference - The Asstt. Commissioner of Income Tax, Vs. M/s Oberoi Realty Ltd.
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