TaxTMI 
TaxTMI 
2016 (11) TMI 1237
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.... based on erroneous views, non appreciation of facts and law on suspicion and conjectures contrary to binding case laws in the appellant's favour, without proper consideration and rebuttal of filings and submissions on record. 4. That the Ld. CIT(A) has erred in not admitting the additional evidence as filed by the appellant arid riot considering the same for grant of relief prayed for by the appellant. OTHER INCOME 5. That the Ld. AO has erred on facts and in law in assessing a sum of Rs. 19,57,55,569/- as income from other sources rather than as business income. The said amount is assessable as business income as an intrinsic part of income from the infrastructure facility project. The Ld. CIT(A) has erred in upholding the view of the Ld. AO. 6. That the Ld, AO has erred on facts and in law in not assessing the said other income of Rs. 19,92,85,259/- as business income derived from the eligible infrastructure facility and in not allowing deduction u/s 80IA in respect of the same. The Ld. CIT(A) has erred in upholding the view of the Ld. AO. 7. That the Ld. AO has erred on facts and in law in riot netting the interest income on FDRs of Rs. 14,50,06,637/- in othe....
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....rly entitled to deduction u/s 80IA of income derived from infrastructure facility. 12.That, inter alia, the appellant is entitled to deduction u/s 80IA(4) on the facts and aw involved as a developer of the infrastructure facility even if it is riot operating and maintaining the same in view of direct decisions in its favour including inter alia reported in ACIT v. Bharat Udyog Ltd. 118 ITD 336 which follows the decision of the Hon'ble Apex Court in K. P Verghese v. ITO 131 ITR 597 (SC) and as in TRG Industries (P) Ltd. v. DCIT (2013) 35 Taxrnann.com 253 (Amritsar - Tribunal). DISALLOWANCE OF EXPENSES U/S 40(A)(IA) 13.That the Ld. AO has erred on facts arid in law in making a disallowance u/s 40(a)(ia) for impugned non deduction from interest and rent said to be paid of Yamuna Expressway Industrial Development Authority (YEIDA). The said disallowance has erroneously been made at a total amount of Rs. 56,34,34,816/-, whereas the correct total amount is Rs. 55,93,52,816/- as seen from his order itself. The Ld. AO has erred in making the said disallowance of alleged interest as it is not debited to P&L Account or claimed as expense but debited as current asset to Projec....
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....t to press the said ground. Ground No. 3 it was submitted may be taken as an argument on the issues agitated in the subsequent grounds. 2.2. By way of Ground No. 5 and 6 it was submitted the assessee prays that the business income brought to tax as "income from other sources" would be on facts eligible for deduction under section 80IA(4). By Ground No. 7 benefit of netting is prayed for. Vide Ground No. 8, FDR's maintained in the course of the business it is being argued is business income and not income from other sources as it is income derived from infrastructure facility. It was his submission that the assessee would be arguing that there is nexus between interest income paid and earned. Ground No.13 it was submitted addresses the grievance against the disallowance made u/s 40(a)(ia). On this issue decision of the Jurisdictional High Court which being the Allahabad High Court it was submitted is in assesse's favour. Alternately even otherwise addressing Ground No. 14 it was submitted reliance is placed on the decision of the Hon'ble Apex Court in the case of the Hindustan Coca-Cola Beverage P. Ltd. vs CIT [2007] 293 ITR 226 (SC). By Ground No. 15 it was submitted the assesse....
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....m interested parties of National / International Stature. The offers were invited by TEA on 14.05.2001 for development, operation and maintenance of 6 lane access controlled Expressway. 3.1.2. M/s Jaiprakash Associates Ltd. (formerly known as Jaiprakash Industries Ltd.) it was submitted was declared the successful Bidder. Reading from the synopsis filed it was submitted that these are admitted facts and are being addressed so as to demonstrate that the assessee scrupulously adhering to the requirements of the Agreement performed its end of the bargain and delivered a world class Expressway which is the showcase of the developmental activity of the country. The assessee on account of performing the tasks undertaken is entitled for claiming the statutory deduction u/s 80IA(4) Explanation (a) of the Act. It was submitted that in the performance of this herculean task meeting the stringent requirements of quality and deliverability it would not be out of place to state that the engineering developmental feat is a technological and developmental achievement in its own rights which has been subjected to rigorous and intense judicial scrutiny, media glare etc. and has faced various inv....
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....pment it was submitted was in addition to the land for construction of Expressway and was an intrinsic part of the infrastructure facility project. 3.1.4. An Assignment Agreement it was submitted was executed amongst JAL, JIL and TEA for assignment of the Concession Agreement in the name of Jaypee Infratech Limited (JIL). 3.1.5. The main Objects of Jaypee Infratech Limited it was submitted were to implement all the objects of the Concession Agreement dated 7/2/2003 between Jaiprakash Industries Ltd. (now Jaiprakash Associates Ltd.) and Taj Expressway Industrial Development Authority (TEA). Elaborating the Project Details it was submitted that the concept of the Project Taj Expressway was an outcome of the Policy decision of the Government of U.P. under the statute called U.P. Industrial Area Development Act, 1976 (UP. Act No of 1976). These facts have been fully examined and considered by the Inquiry Commission headed by Shri. Sidheshwar Narayan, Justice (Retired) High Court Patna and Calcutta, arid TEA, M/s JAL incorporated a Special Purpose Vehicle (SPV) viz. Jaypee Infratech Limited (as "JIL") for development, operation and maintenance of 6 lane access controlled Expresswa....
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.... the uncertainties involved in the revenue from toll collection, inflation etc, it was necessary to strengthen the economic viability of the Project by some mechanism and, accordingly, it was decided to provide 2500 hectares of Land for Development to the successful Bidder along the Expressway". It was submitted that the Commission further held that: "The Taj Expressway Project being a land mark event in the Industrial development of State of U.P. is of immense public utility and also in the national interest". 3.1.9. Techno Economic Feasibility Report (TEFR) it was submitted as submitted by the assessee to YEA further addresses the fact that the toll fee has a 'Negative' Net Present Value (NPV) of the toll fee during the entire concession period. 3.2. In the said background it was submitted that considering the very same facts and the very same activity the Assessing Officer in 2009-10 Assessment year by an order dt. 30.12.2011 passed u/s 143 (3) allowed deduction claimed u/s 80IA. The said year it was submitted was the initial year. In the next assessment year, it was submitted a different Assessing Officer in 2010- 11 assessment year again assessed the income of th....
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....slature then the specific words developing or maintaining and operating or developing, operating and maintaining would not have been necessitated and only the word operating would have been used. It was his submission that the specific scheme and activity has been looked into by the judicial inquiry commission constituted under the Chairmanship of retired Justice Sh. Sidheshwar Narayan and it was also a subject matter of litigation by a PIL filed before the Hon'ble Apex Court and in the said decision of Nand Kishore Gupta and others vs State of UP and others. Considering the specific terms and conditions of the integrated project. 3.5. It was his submission that the legislature has made a distinction between "a highway" and "a toll road" and the modalities for both would differ whereas in a highway the payment for construction may come in installments. In a toll road on the other hand the revenues would only be generated when it is operational and fully constructed. It was his submission that the amounts of funds required to construct the quality of toll road contemplated and visualized was admittedly monumental and accordingly instead of making cash available to the assessee co....
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....'or' where the context so requires. 3.5.2. Accordingly it was submitted that the words "develops and begins to operate................" In section 80IA(2) in the context of section 80IA(4) the word and in 80IA(2) has to be read as "and/or" in the context of 80IA(4) in the alternative to be or to be read as "or" so as to avoid unworkable, unreasonable or absurd interpretation which is not reconcilable with the rest of the statute/section 80IA(4). It was submitted that only when "and" in 80IA(2) is read as "or" that the provisions of section 80IA(4)(i) and 80IA(2) would be in harmony, workable and be in accordance with the text, context and object of the provisions. Accordingly it was his submission that the legislature does not use superfluous words and by contemplating both situations that is develops or operates the assessee is entitled to the deduction. The mere fact that the assessee is developing itself entitles the assessee to the deduction and the Revenue is not correct in its insistence upon the argument that the deduction is available only if the toll fee is collected and because the toll-fee is not collected in the year under consideration the benefit of the deduction i....
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....onomic cycle in the industry has faced various other situations which the assessee when it undertook the task never visualized would be visited upon it. It was submitted that the assessee not willing to hide behind excuses and changed realities has full on tackled the impediments and taken them in its stride to ensure that its work ethics is not compromised and has done and continues to follow through. However in these facts to still be subjected to the concerted departmental actions to misread the provisions of the Act and that too not in the first year but in the subsequent years it was submitted shakes the confidence of the assessee as it is an act of hitting below the belt. The issue it was submitted has already been examined by the ITAT and the order quashing the Revisional proceedings was heavily relied upon; reliance was also placed upon the two consecutive assessment orders u/s 143(3) passed by two separate Assessing Officer; it was submitted that the said authorities have already considered the relevant provisions moreover where all these issues have been again discussed at length and argued by both the sides before the ITAT. It was submitted that when these facts are coup....
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....assessee can in certain situation petition for fresh evidence. The need for filing fresh evidences it was submitted arose as by way of abundant caution the assessee without prejudice to the main claim raised the alternate ground for which fresh evidence was necessary. However, the CIT(A) dismissed the main ground alongwith the alternate without prejudice ground raised by way of abundant caution holding as under:- "Taking all the above into consideration and keeping in view the facts of the case and the relevant provisions of the law, I am convinced that appellant's claim for deduction u/s 80IA in respect of various heads of income declared in the return of income are not covered by the provisions contained in sections 80IA(4) as well as 80IA(6). Accordingly, AO's action in rejecting the claim for such deduction is upheld." 3.8. Addressing the remaining Grounds, attention was invited to the separate written submissions addressing Grounds Nos. 5, 6 and 7. Referring to the facts and the decisions relied upon as set out at pages 2 to 4 of the submissions in para is 1.1 to 1.7 the Ld. AR submitted that the following income of Rs. 19,92,85,259/- has been treated as "other income" n....
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....s 80IA. 3.8.3. Addressing foreign currency fluctuation, it was submitted that the same is in the course of business of the infrastructure facility relating to amounts received from business constituents and should be assessed as business income. Reliance was placed on various decisions of Courts including CIT Vs Racha Udyog 230 CTR 72 (BOM) wherein it been held considering the decision of the Apex Court in CIT vs Liberty India that gains from exchange rate fluctuation are to be included in total turnover of assessee for computing deduction u/s 80HHC. In the facts of the present case also it was submitted the income has resulted in the course of the business of infrastructure facility and as such the income is derived from the business of eligible undertaking and is exempt u/s 80IA. Reliance was also placed on CIT v. Amber Exports (India), 326 ITR 455 (BOM); refer Raghunath Exports (P.) Ltd, v. CIT 11 taxmann.com 273 (Calcutta). 3.8.4. The Misc. Income it was submitted included income from sale of scrap/earth material and earnest money forfeited and forms a part of the main business income of the assessee. 3.8.5. Relying on the written submissions it was submitted that Grou....
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....ome from other sources". The money placed in fixed deposits it was submitted was inextricably linked with setting up of power plants and was a capital receipt not liable to be taxed. As such, there was no interest on FDRs which can be assessed as income from other sources. This argument it was submitted would address Rs, 70.84 crores relating out of the total FDR interest of Rs. 75.75 crores. Balance 4.91 crores it was submitted was interest on FDRs, the source of funds of which were used for Project Under Development, being real estate development forming part of current asset/infrastructure facility. Here too netting of interest was to be allowed and the said amount cannot be taxed as income from other sources. It was submitted that the assessee has adjusted the interest against expressway capital work-in-progress i.e. project under development being real estate development part of infrastructure facility. 3.8.8. Without prejudice to the above argument it was submitted that it was all part of a single object business of the infrastructure facility in the course of business as such it would be assessable as business income even if not allowed to be netted against the said capit....
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..../2014. Reliance was also placed upon Merilyn Shipping & Transporters Vs ACIT (Vishakhapatnam SB) 20 taxmann.com 244. It was submitted that the disallowance had been made u/s 40(a)(ia) read with section 1941 and section 194A for alleged non deduction of TDS. It was submitted that there is no rent or interest within the meaning of section 1941 and section 194A in this case. 3.9.2. It was also submitted that apart from the above arguments even otherwise on facts notwithstanding the above argument addition by way of a disallowance was not maintainable as the assessee has not claimed these amounts as an expense and has capitalised (interest of Rs. 55,88,99,253/- these to project under development and out of lease rent Rs. 2,01,282/- is debited to CWIP; Rs. 2,42,132/- to Project under development and only Rs. 10,149/- has been claimed as expense). 3.9.3. Addressing the rent component the assessee also it was submitted reliance is placed on Krishak Bharati Cooperative Ltd v. ACIT (2012) (Delhi High Court) wherein it has been held that lease premium paid in long-term leases of land is capital expenditure and not allowable as advance payment of rent. Section 1941 of the Act it was sub....
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.... constitute "interest" within the meaning of section 2(28A) of the Act. It was submitted that it was certainly not in respect of any moneys borrowed by the company. It was also not in respect of any debt incurred because, at the time the land was demised to the assessee company under the lease, no external development-assets exist in the books of YEIDA, and no services by way of external development were made available to company (the lessee). Accordingly, no debt by way of any cost of external development could be said to have been incurred by the company at the time of execution of the lease deed, as no external development had actually been provided by YEIDA at that point of time. It was argued that where there was no debt, there could be no deferment of its payment, and no question of incurring any interest. The payments by the company under the nomenclature of socalled interest as a part of the EDC charges it was submitted could not be held as payments of interest within the meaning and scope of section 194A read with section 2(28A) of the Act. Hence, the subject payments are not liable for deduction of tax at source under section 194A. 3.9.5. It was also submitted that int....
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....the CIT(A) it was submitted that the tax authorities had proceeded on the basis of the reasoning that there was no receipt from toll road construction which was in progress during the year. It was submitted that the complete profit declared by the assessee is from sale of plots/built up properties and hence it has been concluded that no depreciation was to be allowed. The income from sale of plot/built up properties it was submitted was an intrinsic part of the infrastructure project and facility. Even otherwise it was argued the income is assessed as business income and depreciation is admissible against the business income involved. The depreciation it was submitted was claimed on assets owned by the assessee and used for the purposes of the business and all provisions of section 32 and relevant provisions of the Act have been complied with. It was submitted that admittedly expressway was under construction as capital work in progress, depreciation on assets having direct nexus with the same have in any case not been claimed as deduction but capitalized as part of capital work in progress. 3.10.1. Without prejudice to the main argument it was submitted that the assessee would ....
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....was her argument that infact the assessee is completely unclear as to which is the relevant section under which its claim can be said to be covered. Reliance placed upon the order of the ITAT, it was her submission is of no help and the reliance placed by the assessee is a mistake as the ITAT at specific page 65 vide para 22 has decided the issue in favour of the Revenue. It was also her argument that the ITAT in the 263 proceedings was required only to consider whether the power of review has been correctly exercised by the Commissioner or not. Accordingly the finding of the ITAT on this limited issue it was submitted cannot be said to be deciding the issue in the present proceedings. Attention was invited to para 127 at page 145 of the Tribunal's order which had also been relied upon by the Ld. AR also, relying upon the same and reading it again it was her submission that the explanation (b) of sub-section 4 of section 80IA(A) was applicable and thus as a result of this, the requirements of it section 80IA(6) were required to be fulfilled. 4.1. Referring to the facts of the case it was her submission that the Assessing officer noticed that the toll road was inaugurated on a sp....
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.... must identify which document was filed before which authority. Thus, without appropriate Certification Ld.CIT DR insisted, she would not be willing to continue her arguments. 5. The Ld. AR in reply submitted that according to his understanding, Certification was in order. However he was willing to Re-certify the Paper Book as required by the CIT DR but before conceding to the departmental request he sought permission to highlight that the Certification is not general and is specific. Referring to the Paper Book, it was submitted that although the final line in the Certificate does read as "Certified to be compiled from the Papers on record and/or filed before the authorities as detailed above" but the description in the Index itself it was submitted makes it clear as to a description of the specific document included in the Paper Book and before which authority, it had been filed. 5.1. As an illustration it was submitted the documents described at Serial No. 2 to 6 admittedly were before the Assessing Officer as well as the CIT(A) as these were the computation of taxable income, financial statement for the year; the copy of the Tax Audit Report in form 10CCB. 5.2. Similar....
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.... the assessment proceedings, the appellant has submitted additional evidence under Rule 46(A) of the income Tax Rule,1962 with the request for its acceptance and consideration, in the appellant proceedings on the plea that assessee was prevented by sufficient cause from producing the same before the AO. In this regard the assessee has submitted auditors' certificate dated 15.11.2014 in form no. 10CCC under Rule 18BBE of Income Tax Rules and has contended that the auditor's certificate has been received only after the assessment was completed vide order dated 31.3.2014 and it was not possible to file the same in the course of assessment before assessing officer. Subsequently, a copy of above request alongwith additional evidence was sent to the AO for remand report which was received in this office on 10.12.2014 and the same was forwarded to the assessee for rejoinder which has since been received in this office on 23.12.2014. For the sake of convenience both remand report as well as appellant's rejoinder have been reproduced in the foregoing para of this order. I have carefully considered the rival contentions and find that the AO has vehemently argued for rejection ....
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....ent have been placed in the departmental Paper Book pages No. 91 to 98. A perusal of the same it was submitted would show that apart from the above two decisions of the Apex Court, reliance was placed on K.R.Nair vs DCIT 262 ITR 669 (Kerala) and Nanji Topanbhai vs ACIT [2000] 243 ITR 192 (Kerala). 6.4. It was her submission that these were surplus funds of the assessee and the assessee's Notes to Accounts states that these were temporary placement of surplus funds. Thus, it was submitted that they could not be said to be interlinked with the business of the assessee. 7. At the close of the arguments Ld. CIT DR filed Paper Book containing written submissions from page 1 to 11 of Principal CIT, Noida; Copy of Assignment Agreement dated 19.10.2007 between the assessee, JAL and Taj Expressway Industrial Development Authority (page 12 -90); and the copies of decision relied upon (page 91 to 98). 7.1. A perusal of the written submission shows that the Revenue relies upon the following arguments so as to address the provisions invoked:- 1. "Section 80- IA(1) grants deduction in respect of any profits and gains derived by an undertaking from any business referred to in sub-sect....
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.... profits arising exclusively from highway project would be admissible for deduction under sub-section (1) read with sub-section (2) and (2A). 8. Any relaxation of the provisions of Chapter VI-A (including the prescribed Rules thereto) is governed by Section 119(2)(c) of the Act which mandates only the Board in the event that it finds it desirable or expedient to avoid genuine hardship in any case, to do so subject to the condition that the default (in compliance for which the relaxation is sought) was due to circumstances beyond the control of the assessee and it has complied with such requirement before the completion of the assessment. Further, every such order is to be laid before each House of Parliament. 9. The assessee has begun to operate the infrastructural facility w.e.f 09.08.2012 and hence prior to this date it had only profits which are attributable to sale of land, transferred to it in terms of Concessionaire Agreement. Therefore, in respect of profits exclusively from the highway project, the assessee could have made a claim for deduction under Section 80-IA only w.e.f Assessment Year 2013-14. 10. The case of the assessee would squarely fall within clause (b)....
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.... the case of MCD Vs. Mohd.Yasin (142 ITR 737). a) The terms Toll Road, Highway and Expressway, on one hand and toll, toll gate and toll plaza on the other are not analogous terms. b) Road is a generic term and Highway & Expressway members of the same genus. c) Levy of toll will not denigrate the character of a highway. From the above cited case law, it is noteworthy to mention that 'Highway and Expressway are of same genus' and 'Levy of toll will not denigrate the character of a highway'. Thus in essence expressway is a highway and is a broader connotation than a toll road. 1(b)It is seen that 'highway' and 'toll road' have not been used in concessionaire agreement and the word 'expressway1 has been used several times. There was a contract between assessee company and Taj Expressway Authority for developing, operating and maintaining a six lane controlled access Expressway with limited access and exit points between Noida and Agra and a fees/toll was payable to assessee company for vehicles using the Expressway at toll plazas. 1(c) It has been contended by the assessee in scrutiny proceedings that land received for sale and/or deve....
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....EA, rights for land development of 25 million sq. meters of land along the proposed Expressway for commercial, amusement, industrial, institutional and residential development. The assessee himself treats it as integral project but refutes to apply Clause (b) of Explanation to Section 80IA(4)(i). Holding its contention, it stresses the income from sale of land as derived one. On careful perusal of the agreement, while the assessee accepts the Concession for a period of 36 years commencing from the date of commencement, is it willing to give back the land given as incentive after 36 years to the TEA? The law is clear that allied activities cannot fall in clause (a). During the year, the entire profits were derived from allied activities and hence the deduction granted for profits derived from allied activities cannot be adjudicated under clause (a) of Explanation to Section 80IA(4). If the allied activities eligible for deduction is included in clause (a) of Explanation to Section 80IA(4), then what is the intent of clause (b) in the Income tax Act, 1961. 2(c). Drawing from the above, the contention of the Revenue is that it falls under clause (b) of Explanation to Section 80IA(4....
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...., a prerequisite for the grant of deduction. 3(c) As per proviso to sub-clause (c) to Section 80IA(4)(i) of the Act, wherein it is also provided that if developer of an infrastructure facility transfers the same, then the transferee enterprise would also be eligible for deduction, meaning thereby the enterprise which only develops infrastructure facility is eligible for deduction and in case developer transfers the facility for operation or maintenance to another enterprise then the transferee would be eligible for deduction for unexpired period . the case of the assessee is one in which it has entered into an agreement for developing, operating and maintaining infrastructure facility, a distinct category of eligible project specifically covered under subclause (iii) of clause (c) of Section 80IA(4) of the Act and the assessee has not entered into an agreement only for developing of infrastructure facility as envisaged in sub-clause (i) of clause (c) of sub-section (4) and as per provisions of the Act, the deduction would be admissible only on the commencement of the operation. There can be an instance where an assessee has entered into an agreement with Centre/State Govt/Statut....
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....mstances of the case, there is nothing to be alleged that Ld CIT(Appeals) have not followed canons of justice. Instead sufficient opportunities have been provided and matter has been adjudicated on facts and circumstances of the case. On other income Grounds no. 5-8 have been raised on additions main on other grounds and the same has been exhaustively discussed in orders of l_d CIT(Appeals) as well as that of Assessing Officer. On disallowance of deduction u/s 80IA Grounds no. 9-12 have been raised on disallowance of deduction u/s 80IA which dealt at length in preceding pages. Even going by the principles laid down in this case, the facts say that as per agreement between TEA (Taj Expressway Authority) and the assessee group, an expressway was to be constructed between two prominent cities and toll would be charged on that expressway. At that very time and even now, this expressway is a prominent landmark in infrastructure. Merely having mention of toll plazas in agreement can't change the genus of highway/expressway as discussed citing case law of MCD Vs. Mohd.Yasin (142 ITR 737), adjudicated by the same Apex Court. At no point has the Hon'ble Tribunal held tha....
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....itted that the innuendo by the Ld.CIT DR that the date of inauguration as 09.08.2012 was discovered by the Assessing Officer was incorrect on facts as the record would show that this specific date was pointed out by the assessee itself. It was his submission that once the user of funds is considered it would be seen that the utilization of funds far exceeds the funds generated. Accordingly it was submitted that unless the assessee is required to argue the allowability of its claim under section 80IA(6), he is under instructions not to argue further. 9. Since considering the grounds raised, the Revenue had already argued that the without prejudice ground cannot be allowed relying on the findings recorded by the CIT(A) and supplemented by the arguments before the Bench the Ld.AR was directed to complete his arguments on the grounds raised unless the grounds are being given up. Once the issues had been argued by the Revenue where we understand that the departmental stand clarified by Ms. S.Verma, CIT DR was that if at all the deduction was to be allowed it could be considered in 2013-14 AY only and as far as the claim in the year under consideration was concerned the deduction coul....
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....e public importance of the Expressway by which the state gains advantages by the creation of the five zones for industry, residence amusement which would be complimentary to the Expressway leading to planned development of this industrially backward area holding the Expressway and the five parcels of land being complementary to each other and parts of an integral scheme and thus for a public purpose. In these facts and circumstances, it was submitted there can be said to be no doubt in holding that the assessee was correct in making its claim under section 80IA(4). However on account of the insistence of the Assessing Officer to deny the claim made u/s 80IA(4) the alternate claim was made. The claim u/s 80IA(4) having been dismissed, it was submitted was argued without prejudice before the CIT(A). The main argument therein was also that the claim is allowable under section 80IA(4). Accordingly making the assessee's position clear it was submitted that without prejudice to the main argument, the assessee sought to place additional evidences before the CIT(A) as admittedly the compliances for making the claim u/s 80IA(6) were not complied within the year under consideration and have ....
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....r deciding the same the fresh evidences may be admitted as the evidences are material and crucial for deciding the alternate claim and the issue may be sent back. 9.2. Replying to the arguments of the Ld. CIT DR that there has to be direct nexus for allowability of assessee's claim it was submitted that it is a fact on record that these incomes are derived from the business of the assessee which is an integrated business thus it is not a case where surplus and idle funds have been kept in banks waiting for opportunities to invest. The following judgements, copies of which have been placed at Serial No. 7 of the case law Paper Book was heavily relied upon Commissioner of Income Tax vs Dharam pal Prem Chand Ltd. 317 ITR 0353 (Del); CIT vs Eltek SGS P.Ltd. [2008] 300 ITR 6 (Delhi); CIT vs Lok Holdings (Bom.) 308 ITR 356. Infact it was his submission that the nature of assessee's business as considered by the ITAT has already considered these issues conclusively as the present forum is concerned as the issue is purely factual. 10. We have heard the rival submissions and perused the material available on record. We find on a consideration of the facts recorded in the assessment or....
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....eging that it was bad in law as the assessment order u/s 143(3) was claimed to be neither erroneous nor prejudicial to the interests of Revenue and was claimed to have been passed correctly after due enquiry wherein it was submitted the ITAT held that the AO instead of taking one of the possible views infact took the only correct view available. The departmental stand considered by the ITAT on the other hand it is seen has considered the very same arguments as advanced by the Ld.CIT DR in the present proceedings where the Revenue had argued that the relevant provisions having been incorrectly appreciated by the AO on facts where deduction u/s 80IA(4) has wrongly been granted and if at all deduction had to be allowed it was to be considered u/s 80IA(4) Explanation (b) r.w.s 80IA(2) and that too only on fulfilling the requirements as mandated u/s 80IA(6) and not in the year under consideration. We find similar arguments have been advanced before us also. We note that the Co-ordinate Bench accordingly in order to decide the claims and counter-claims of the parties undertook a detailed enquiry and made an examination of facts and the relevant provisions of the Act going on to finally t....
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....n or any other body established or constituted under any Central or State Act.] (5) xxxxxxx (6) The amount of deduction in the case of the business of a ship shall be thirty per cent of the profits and gains derived from such ship for a period of ten consecutive assessment years including the initial assessment year provided that the ship - (i) is owned by an Indian company and is wholly used for the purposes of the business carried on by it ; (ii) was not, previous to the date of its acquisition by the Indian company, owned or used in Indian territorial waters by a person resident in India; and (iii) is brought into use by the Indian company at any time during the period beginning on the 1st day of April, 1991 and ending on the 31st day of March, 1995." 10.2. It may be appropriate to refer to the specific grounds raised by the assessee before the Co-ordinate Bench which were required to be considered. A perusal of specific Ground Nos. 5, 7, 8 and 9 before the Co-ordinate Bench would show that the arguments advanced in respect thereto on facts are repeated in the present proceedings also. A perusal of Ground Nos. 5 & 8 raised before the Co-ordinate Bench, it is se....
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.... setting aside the assessment. 9. That without prejudice, in the alternative, as the appellant is eligible for deduction under section 80IA(6), even as per the view of the Ld. CIT, then in any case on the facts and law involved, the assessee is entitled to relief and deduction in this matter, be it under 801A(4) OR 80IA(6). Setting aside the assessment to be made de novo is unlawful, uncalled for and would be merely an academic exercise if permitted. (emphasis provided) 10.3. A perusal of the above would show that the claim of the assessee that the issues stands considered by way of a binding precedent was not misplaced. Hence as observed the reluctance of the Ld.AR to address the without prejudice claim of allowability of assessee's claim of deduction u/s 80IA(6) can be better appreciated and as we had noted infact the Ld.AR had to be directed to complete his arguments on all the grounds which the assessee wished to press as the allowability of the alternate claim also stood opposed by the Revenue. However now, as noted on minutely going through the arguments of the respective parties and the facts on record which necessarily include the reasoning on facts and law adopted....
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....clause (a) of Explanation to Section 80IA(4)(i) of the Act? (iv) Whether the assessment order questioned and alleged by the ld. CIT, is unsustainable and not in accordance with law and has been passed without application of mind, in the peculiar facts and circumstances of the case, specially in the light of the provisions of section 80IA(4) r/w its sub-sections (2) & (6) and other relevant provisions of the Act and the Income Tax Rules, 1962. (v) Whether the CIT Noida was in error by invoking provisions of section 263 of the Act in the peculiar facts and circumstances of the present case, specially when he has not decisively concluded the issue i.e. whether the assessee is developing a toll road or a highway project and left it midway without any decisive conclusion/direction? (vi) Whether the ld. CIT exercised its powers u/s 263 of the Act in revising the assessment order on the issue of allowability of deduction u/s 80IA(4) of the Act on interest earned from FDR and without show causing the assessee in the notice u/s263 of the Act &on the issue of allowability of depreciation and, therefore, the same is not valid and void ab initio on these issues." (emphasis provided....
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....ara 44 the Co-ordinate Bench it is seen has addressed the litigation in the Apex Court by the assessee in a PIL alleging inadequate consideration for acquisition of land amongst other issues wherein the very same Agreements/scheme and activities was a subject matter of consideration. A perusal of Paras 49, 50 and 51 of the Co-ordinate Bench brings out the arguments advanced by the parties before the Co-ordinate Bench on the specific provision of law applicable. A perusal of the same shows that the arguments are identical in the present proceedings also. The Co-ordinate Bench it is seen considering these undertook to consider the meaning of the words "Highway", "Expressway," "Toll plaza" and "road including toll road" in paras 52 to 57 and thereafter considering how these words have been used in the Agreement proceeded to reject the departmental view canvassed namely that the assessee is engaged in the development of infrastructure facility of a "highway including housing or other activities being an integral part of the highway project". On the basis of the discussion it was the considered opinion of the Co-ordinate Bench that the business activities of the assessee company fell wi....
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.....e. the initial year which was 2009 - 10 assessment year. 10.7. In the said background, we would briefly sum up the facts in the present proceedings wherein we find that the view expressed by the AO has been upheld by the CIT(A) without addressing the submissions extracted in the order. A perusal of the reasoning adopted by the AO in the present proceedings shows that the fact that "the toll road was inaugurated on 09.08.2012 i.e. during the period relevant to A.Y. 2013 - 2014" was a fact taken note of by and the AO in the present proceedings also and this fact was one of the foundational facts noted by Ld.CIT, Noida in his order u/s 263. In the facts of the present case also the AO held that "it was found that the income declared from business during the year did not contain any income from the infrastructure facility being toll road. On noticing the above facts, a show cause dated. 13.03.2014 was issued to the assessee requiring clarification and justification on the claims made by the assessee u/s. 80IA(I), which has been abstracted above." The existence of this fact was also one of the main reasons considered by CIT, Noida. The replies of the assessee in the AO's words shows....
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.... 143(3) in 2009-10 AY was dismissed by the AO in the following manner:- "The assessee has also submitted that in earlier years i.e. in A.Y. 2009 - 2010 and A.Y. 2010 -2011, under more or less, similar facts and circumstances, he claimed deduction u/s. 80 IA which was allowed u/s. 143 (3). The assessee has also quoted the decision reported at 191 ITR 321 (SC) in the case of RADHA SWAM1SATSANG VS. CIT for the legal preposition that the principle of consistency should have been followed, In this regard, there is no dispute that initially in Asstt.'s u/s. 343 (3) the said deduction was allowed to the assessee. However, vide order u/s. 263 dtd. 30.03.2014 passed by Commissioner of Income Tax Noida has already cancelled the said deduction u/s. 80 IA in A.Y. 2009 - 2010 and the said issue set-aside to the file of Assessing officer for fresh adjudication. Hence, as on date the said deduction does not survive so far as A.Y 2009 - 2010 is concerned. (emphasis provided) 10.8. Thus we find that the AO in these peculiar facts in the face of the order u/s 263 of CIT, Noida was unable to look beyond the said order and could not have taken guidance from the view taken by the AO in the....
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.... order. The Co-ordinate Bench after setting out the facts; the specific provision of law; the Agreement dated 07.02.2003 between the Taj Expressway Industrial Development Authority (TEA) Statutory body constituted under UP Industrial Development Act 1976 relevant portion of it are found extracted in para 20 at pages 57 to 64 by the Co-ordinate Bench has proceeded to analyse these in para 21 to hold as under:- 21. In view of above agreement, the assessee was under obligation to do "work" as mentioned in para 2.1 of chapter II and in turn, concession was granted by the TEA to the assessee as mentioned in chapter III, the land for construction of Expressway and land for development was provided to the assessee and the same was released by the TEA, as per terms of 4.1 and 4.2, respectively, of Chapter IV of the agreement. As per above provisions and terms of the agreement, the TEA has to provide land for expressway and land for development to the assessee on cost of acquisition plus a lease rent of Rs. 100/- per hectare per year. The assessee was under obligation to construct Expressway between Agra and Noida in U.P. and concession as mentioned in Chapter-III was granted to the asse....
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....ving traffic would help the industrial culture created in the five parcels. Thus, both will be complimentary to each other and can be viewed as parts of an integral scheme. Therefore, it cannot be said that it is not a public purpose. .................. (last part of para 30) We have already considered this question that in the present case, there is nothing to indicate that the acquisition is for the Company i.e. for Jaiprakash Industries Ltd. It is only, therefore, that we are at pains to point out that the Government was only using the Company for implementing its policy." (last part of para 34) (emphasis provided) 10.10. Considering the same, the Co-ordinate Bench came to the following conclusion:- 23. "Hence, in view of above observations of Hon'ble Apex Court in para 30, we may safely infer that the land for development of the Expressway and development of five land parcels for industrial, commercial, amusement and residential purposes was allotted to the assessee under concession agreement. The work of the development of the Expressway and development of the land are integral and inseparable part of the project/scheme. We may also point out that the land....
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....nue authorities, the enterprise would be entitled for exemption u/s 80IA(4) of the Act only after completion of the project even if development takes more than one year to start operations and then only the income derived from operating and maintaining of infrastructure facility would be eligible for exemption and enterprises engaged in development activities would never be entitled for exemption. Obviously, this cannot be an intention of legislature and CBDT circular (supra) while framing the provision of section 80IA of the Act and issuing Circular No.1/2006 (supra) respectively. 30. At this juncture, we respectfully take cognizance of the decision of Hon'ble Supreme Court in the case of K.P. Verghese (supra) and decision of Full Bench of Hon'ble Orissa High Court in the case of Gangaram Chopalia (supra) and decision of Hon'ble Jammu & Kashmir High Court in the case of CIT vs J&KTDC (2001) 248 ITR 94 (J&K), as relied by the ld. AR. In the case of K.P. Varghese v ITO (supra), the Apex Court held that the interpretation of a statute being an exercise in the ascertainment of meaning, everything which is logically relevant should be admissible. The relevant part of the decision re....
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.... with the main object and scope of work, commencement of business operation are eligible for exemption u/s 80IA of the Act. Firstly, we note that Hon'ble Apex Court laid a basic principle for interpretation of beneficial taxation statutes in the case of Bajaj Tempo Ltd. (supra) which reads as follows:- "A provision in a taxing statute granting incentives for promoting growth and development should be construed liberally; and since a provision for promoting economic growth has to be interpreted liberally, the restriction on it too has to be construed so as to advance the objective of the provision and not to frustrate it. BY THE COURT: "If a provision for checking abuse is found to have resulted in nullifying the very purpose of its enactment and the Legislature intervenes, then it can be assumed that the Legislature, having been satisfied of the failure of the purpose for which the provision was inserted, proceeded to cure the defect by suitably amending the provision or removing it." 33. In the decision of ABG Heavy Industries (supra) the Hon'ble Bombay High Court referring to the ratio of the decision of Hon'ble Apex Court in the case of Bajaj Tempo (supra) h....
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....er respectfully note the ratio of the decision of Hon'ble Bombay High Court in the case of ABG Heavy Industries (supra) wherein it was categorically held that the assessee did not have to develop the entire port or project in order to qualify for exemption u/s 80IA of the Act and that should not be an intention and expectation of legislature to legislate a condition impossible of compliance." 10.12. The Co-ordinate Bench again in para 38 summed up the controversy in the following manner:- 38. "Having heard arguments of both the sides and after having gone through relevant material placed on record, written submissions, gist of case laws relied by both the parties, we note that the main controversy in this case is mainly that the assessee is claiming that as per objects of the company, concession agreement and main activities of the company, the company developed a toll road between Noida and Agra and his claim for deduction falls on four corners within the ambit of clause (a) of Explanation to section 80IA(4)(i) of the Act. Per contra, the main contention of the ld. CIT, Noida is that the assessee developed "a highway project" which was inaugurated on 9.8.2012 by Hon'ble Chie....
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....As noted earlier in order to adjudicate upon the claims and counterclaims, the Co-ordinate Bench undertook to consider the meaning of "highway", "expressway", "toll", "toll gate" so as to address the terms as used in the Concessionaire Agreement. After considering these, it was concluded in para 54 that the use of Expressway, the toll fees and the cumulative stipulation that the assessee was tasked to developing, operating and maintaining a six laned controlled access expressway with limited access and exit points between Noida and Agra where fee was payable to the assessee for vehicles using the Expressway at toll-plazas on the toll-road, leading the Co-ordinate Bench to finally conclude in para 57 that the business activities of the assessee company fall within the ambit of clause (1) of Explanation 80IA(4) of the Act. The reasoning and conclusion is extracted hereunder:- 52. "On careful consideration of above rival submissions, we note that firstly it would be just and proper to consider the meaning of the "highway", "Expressway", "Toll", "Toll gate", "toll plaza" and "road including toll road" which are being repeatedly used by both the sides during arguments. We may point o....
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.... with three lane per carriage way, meaning thereby both way six lane, with controlled limited access and exit points; whereas a "Toll" is a fee or charge payable to use of a road or bridge; Tollgate" is a gate at the start of a road or bridge at which user pays an amount of money (toll). For the use of road or bridge; and "Toll plaza" is a row of toll booths on a toll road. 54. Turning to the facts of the present case, we may note that in the concessionaire agreement the words, "highway" and "toll road" have not been used and the word "Expressway" has been used several times which has been defined at page 6 of the agreement as the access controlled 6-lane Expressway between Noida and Agra with service roads and associated facilities and on the same page 6 of the agreement the word "Fees" has also been defined as "Fees means the charges levied on and payable for vehicles using the Expressway in accordance with the fees as may be settled under this agreement." The cumulative meaning of these words used in definitions and other stipulations of the agreement make it vivid that there was a contract between assessee company and the TEA for developing, operating and maintaining a six l....
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....s to be the main plea in the present proceedings the Co-ordinate Bench also was required to address the issue specifically considering the facts that since the income available then was only from sale/sub-lease of land for 2009-10 AY. Thus, the issue whether the assessee company is eligible for exemption u/s 80IA(4)(i) of the Act, we find has already been considered by the Co-ordinate Bench on similar facts. A further reading of paras 59 onwards and facts as set out in paras 60 to 61 which infact is based on the terms of the Agreement reproduced in para 20 by the Coordinate bench and analyzed in para 21 would show on considering the very same facts; the arguments of the parties and discussion in para 35 to 50 it can be seen that it is identical to what has been considered by the AO in the present proceedings and argued by the Ld.CIT DR before us. These facts and discussions are even relevant for considering the departmental stand in respect of the arguments in support of "Other Income" as not being "derived" from eligible business directly. These arguments also address the facts relatable to the disallowance made by the AO u/s 40(a)(ia) in the present proceedings which issues we sh....
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.... infrastructure facility is provided, inter alia, by way of right to develop and sub lease the adjoining land allotted to assessee is evident from concession agreement executed between assessee and the TEA and relevant extracts, conditions and clauses clearly demonstrate that the assessee was under obligation of development, operation and maintenance of the Expressway and development of 25 million sq. Metre land along the proposed Expressway for commercial, industrial, institutional, amusement and residential development. It was also explained that as per concession agreement, the assessee company was under obligation to pay cost of acquisition plus lease rent of Rs. 100/- per hectare per annum for the land proposed to be used for construction of Expressway and also for the 25 million square Meter land for development along the proposed expressway at five or more locations. Ld. AR further explained that the assessee was not granted any title over the Expressway and land used for construction of Expressway except right to collect toll/fees as prescribed by Govt. of UP from time to time only during concession period of 36 years and assessee was granted land for development with right....
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....rastructure facility and if instead of a sum of money, the assessee has been allotted land for development with related rights and obligations, then obviously the income on sublease of the land is just a sum of money in kind on its realisation and is income from the business of said infrastructure facility. Ld. AQR further contended that the said income from sub lease of land has been utilized for developing the infrastructure facility and same was actually utilized during the relevant financial year for infrastructure facility project and the overall cost/capital expenditure was for exceeding from the income derived therefrom and as such there was no taxable income." 10.17. The Assessee's re-joinder as recorded by the Co-ordinate Bench is also reproduced hereunder for the sake of completeness:- 70. "Ld. AR placing rejoinder to the above legal contentions of the revenue, submitted that the language used in clause (c) is "has started" or "starts". The expression "has started" indicates the events which have already occurred whereas the expression "starts" indicates the events which would occur and since the assessee is in the business of developing, operating and maintaining "....
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....o the deduction in respect of profits and gains from enterprises engaged in infrastructure development etc. We further note that as per language used therein sub-section (1) grants deduction in respect of any profits and gains derived by an undertaking or an enterprise from any business referred to in subsection (4) thereof, under sub-section (2) the admissible deduction is 100% of the profits and gains of eligible business for ten (10) consecutive assessment years (AY) out of twenty (20) AYs beginning with the AY in which such undertaking or enterprise develops and begins to operate any infrastructure facility referred in clause (iii) of sub-section (4). 73. We may further note that sub-section (4)(i) r/w clause (a) and (b) are related to deduction in respect of the enterprise carrying on business of (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining any infrastructure facility which fulfils the following conditions:- (a) It is owned by a company registered in India or by consortium of such companies; (b) It has entered into an agreement with Central Government or a State Government or a local authority or any Statutory Body....
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....end when development work concludes and thereafter operation and maintenance thereto is started. When the intention of legislation is that the entrepreneurs should be encouraged and promoted towards infrastructure development etc., then it is a positive inference that the legislation intended to grant deduction for the enterprises which only develops or which operates and maintains or which develops, operate and maintain infrastructure facility. Our aforesaid view also finds support from proviso to sub clause (c) to section 80IA (4)(i) of the Act, wherein it is also provided that if developer of an infrastructure facility transfers the same, then the transferee enterprise would also be eligible for deduction as if it were the enterprise to which this clause (c) applies i.e. transferor enterprise, meaning thereby the enterprise which only develops infrastructure facility is eligible for deduction and in case developer transfers the facility for operation or maintenance to another enterprise then the transferee would also be eligible to deduction for the remaining or unexpired period as per sub section (2) or other relevant provisions of the Act. Hence, in view of above discussion, w....
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....as also contended that the activity of sub lease or sale of land for development, which was received by the assessee as a major part of consideration of project, is an integral and inseparable part of main business activity of development of infrastructure facility, therefore, income/profits derived during AY 2009-10 from sub-lease of land are the first degree operational profits of the business which is eligible for deduction u/s 80IA(4)(i) read with Explanation (a) thereto. 79. Since we have already held that the assessee company is in the business of development of "road including toll road" infrastructure facility and the enterprises which only develops infrastructure facility are eligible for deduction u/s 80IA(4)(i) of the Act from the date when it begins to operate its business activity of development of infrastructure facility. Ld. CIT DR could not demolish these contentions of the assessee including the contention that the business operations of eligible enterprises visualises the development of infrastructure facility. When development activities come to an end or completed and such activity begins to facilitate the intended users, the act of operation and maintenance ....
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....tructure facility i.e. which is a toll road as per its operational features and controlled and chargeable access and exit and the assesses' claim under clause (a) of Explanation to section 80IA (4) (i) of the Act is justifiable and plausible as per relevant provisions of the Act in the light of the character, facts and circumstances of the business of the assessee. Hence, we are of the considered opinion that the prepositions of two views is not applicable to the present case and even if view posed by the Ld. CIT is analysed then we note that the Ld. CIT himself has not conclusively decided that the assessees' claim of deduction falls under ambit of clause (b) of explanation to section 80IA (4) (i) of the Act." 10.21. Considering the ratio of the decisions relied upon by the Revenue to show that the assessment order in the base year was erroneous and prejudicial to the interest of the Revenue, the Co-ordinate Bench dismissed the claim and upheld the correctness of the order again in categoric terms by holding as under:- 110. "In view of ratios laid down by the judgments, as relied by the Ld. CIT DR and having gone through the facts of these cases, at the outset, we sincerely ....
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.... clearly put the Expressway within the ambit of road which is a toll road. We further hold that the development of the Expressway between Noida and Agra and development of Five land parcels adjacent to Expressway are inseparable and integral part of one project and the assessee is entitled and eligible for deduction u/s 80IA (4) of the Act on the income earned and derived from the business of development of Infrastructure facility during AY 2009-10 after commencement of its business w.e.f. 5.4.2007 at the option of the assessee which cannot be denied by wrongly putting the case of the assessee in clause (b) of Explanation to section 80IA(4)(i) of the Act." (emphasis provided) 10.24. Accordingly on considering the peculiar facts and circumstances of the present case and the relevant provisions which have been considered by the Co-ordinate Bench in the base year and considering the assessment order which was u/s 143(3) in the base year which remains undisturbed and the assessment order u/s 143(3) in the immediately preceding assessment year which has been passed by a different Assessing Officer then the one who passed the order in the base year, we find that the Revenue has fai....
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....assessee in violation to the claim of deduction u/s 80IA of the Act on the business profits, interest and other income received during the year, therefore, the order of the AO was held to be erroneous and prejudicial to the interest of the Revenue and the Tribunal upheld the order of the CIT u/s 263 of the Act. We find that the Co-ordinate Bench also proceeds to record the arguments of the Ld. CIT DR by noting that it was also pointed out before them that the Assessee had claimed depreciation amounting to Rs. 22.97 crores and had been granted by the AO even while the highway project had not been completed, therefore Ld. CIT rightly held that the assessment order was patently erroneous and prejudicial to the interest of the Revenue. 10.27. We find that the said submission of the Revenue was opposed by the assessee before the Co-ordinate Bench as would be evident from the following para:- 95. "The Ld. AR placed brief rejoinder to the above submissions and contentions of the Ld. CIT-DR and pointed out that the AO made sufficient and required enquiry about claim of the assessee as the AO raised several queries during assessment proceedings and the assessee submitted detailed repl....
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....mber of queries regarding the claim of the assessee u/s 80IA (4) of the Act which were replied by the assessee through detailed submissions supported by relevant documents and other evidence coupled with several legal propositions and decisions. It is also pertinent to note that the AO has passed a detailed order / note sheet entry (enclosed here with this order as Annexure - A for sake of clarity and brevity) while dealing and adjudication the issue of allowability of the claim of the assessee for deduction u/s 80 IA (4) of the Act. We may respectfully take note of the decision of Hon'ble Bombay High Court in the case of Gabriel India Ltd. (supra) and hold that the order of the AO cannot be held as erroneous merely because, according to the Ld. Commissioner, the order should have been written more elaborately in so many words for invoking supervisory provisions u/s 263 of the Act. There must be some prima facie material on the record to show that the order is unsustainable in law and the tax which was legally eligible has not been imposed." 10.30. Thus observing as under in para 111 the Co-ordinate Bench considering the various case law cited before the Bench finally relying up....
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....een temporarily parked in banks and used for raising loans from the banks against Guarantees etc. The utilization of these amounts admittedly is again for the very same sole purpose of infrastructural facility. In the circumstances, we find the income is necessarily, directly and inextricably linked with the eligible business of the assessee. Considering the character of the same, the facts and circumstances of the specific and peculiar nature of assessee's business, the nexus is direct. The income can be said to be inseparably linked with the sole business purpose of the assessee which is the infrastructural facility. The acceptance of this fact by way of precedent is not only evident from the fact that the income was included in eligible business by two different Assessing Officers in two separate assessment orders but is also evident from the order of the Co-ordinate Bench in the base year itself. 10.32. A perusal of the reasoning in the assessment order shows that AO has held that interest income is not derived from eligible business. The order u/s 263 order it is seen is the reason to deviate from the view taken in two consecutive years and hence proceeded to deviate from t....
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....aimed is limited to the assets used in the business and the ownership of the assets is not in doubt. The past precedent of no disallowance having been made on the said issue is also cited. Apart from that the additional argument that incase disallowance is sustained then it goes to inflate the income of the assessee and the fact that the only income of the assessee is the business income wherein deduction is claimed and allowable the purpose of denying the same departing from the precedent with no purpose was questioned. We find on considering the orders of the tax authorities and the precedent including the aforesaid order of the Co-ordinate Bench the claim of the assessee subject to verification on facts deserves to be allowed. On a consideration of the reasoning qua depreciation recorded by the AO and upheld by the CIT(A), we find that the only reasoning taken is that since the project of toll road construction was in progress where from no receipt was declared the profit being solely from sale/lease of plots the claim was disallowed. In view of the categoric finding of the Co-ordinate Bench that the business has commenced the reasoning adopted cannot be sustained. Subject to ve....