Section 80IA(4) deduction denied where concession came from a private consortium, and revision for lack of inquiry was upheld.

Deduction under Section 80IA(4) was unavailable because the concession relied on was granted by a private airport consortium and not through an agreement with the Central Government, a State Government, a local authority, or another statutory body. The statutory preconditions for infrastructure-facility deduction were therefore not satisfied, and the claim could not be sustained. The assessment order was also held to be erroneous and prejudicial to the Revenue because the Assessing Officer allowed the deduction without properly examining those conditions, so revision under Section 263 was justified.

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Issues: Whether the assessee was entitled to deduction under Section 80IA(4) of the Income-tax Act, 1961 on the basis of a concession granted by DIAL, and whether the Principal Commissioner was justified in invoking Section 263 to revise the assessment order.

Analysis: The deduction under Section 80IA(4) is available only where the enterprise carries on the specified business of developing, operating or maintaining an infrastructure facility pursuant to an agreement with the Central Government, a State Government, a local authority or any other statutory body. The Court held that DIAL was not a Central or State Government, a local authority, or a statutory body merely because it had been granted a concession under the airport development framework. The assessee's agreement was therefore not with a qualifying authority under Section 80IA(4), and the claim to deduction could not be sustained. Since the Assessing Officer had allowed the claim without properly examining these statutory preconditions, the revisionary jurisdiction under Section 263 was validly exercised.

Conclusion: The assessee was not entitled to deduction under Section 80IA(4), and the revision order under Section 263 was sustainable. The Tribunal's interference was incorrect.

Ratio Decidendi: A concession granted by a private consortium is not an agreement with the Central Government, a State Government, a local authority or a statutory body for the purposes of Section 80IA(4); therefore, deduction under that provision cannot be claimed, and an assessment order allowing such claim without proper inquiry is erroneous and prejudicial to the interests of the Revenue.

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