TaxTMI 
TaxTMI 
2013 (4) TMI 512
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....25,13,170/- claimed by the assessee u/s 80IA of the I T Act. 3. Brief facts of the case are that the assessee company, engaged in the business of civil engineering works and construction of national highways, filed its return of income on 31.10.2005 declaring NIL income and claiming deduction of Rs.2,25,13,170/- u/s 80IA of the I T Act. The assessee company had also shown a book profit of Rs.3,64,09,495/- u/s 115JB of the Act. During the assessment proceedings u/s 143(3) of the Act, from the profits and loss account filed along with the return of income, the AO observed that the assessee had shown the total contract receipts at Rs.50,71,06,783/- whereas as per the TDS certificates, the total contract receipts works out to Rs.50,72,62,959....
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....act by NHAI and the consortium had sub-contracted the main contract on a back-to-back basis to the joint venture ECSB-JSR Constructions Pvt. Ltd., which in turn had sub-contracted the entire NHAI work to the assessee on a back-to-back basis transferring to the assessee all duties and responsibilities in respect of the work imposed on the consortium by the NHAI through the main contract. It was also submitted that the assessee was entitled to receive the entire contract amount of Rs.104.90 crores except for 3.5% of the contract amounts payable to ECSB-JSR Constructions Pvt. Ltd. The assessee had also further emphasized that the expenditure incurred on construction machinery alone was around Rs.23 crores as on 31.3.2005 which shows that the a....
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....tract agreements. The CIT(A) observed that the NHAI has awarded the contract to the consortium on 12/10/2001 for execution of civil works in Rajasthan State for a contract price of Rs.104.90 crores and a letter of award dated 5.9.2001 was issued confirming that the net accepted bid was Rs.104.90 crores after rebate etc. for execution, completion and maintenance of the above works. Thereafter, the company called M/s ESCB-JSR Constructions (JV) Pvt. Ltd. was incorporated on 9.11.2001 as ascertained from the Certificate of Incorporation from the Asst. Registrar of Companies, Bangalore, Karnataka and this company further entered into a sub-contract with the assessee company and awarded 100% full scope of works as defined in the main contract. ....
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.... 9. The learned counsel for the assessee, on the other hand, supported the order of the CIT(A) and also drew our attention to all the agreements filed by the assessee before the CIT(A)n to substantiate its claim that it was a member entity of the consortium, which was awarded the contract by NHAI and that it is eligible for deduction u/s 80-IA of the Act. 10. Having heard both the parties and having considered the rival contentions, we find that the deduction u/s 80IA is available in respect of profit and gains from the industrial undertaking or enterprises engaged in infrastructure development etc. The only reason for the disallowance by the AO is that the assessee has undertaken the sub-contract works and has also not undertaken the ....