TaxTMI 
TaxTMI 
TaxTMI 
2017 (6) TMI 776
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....grant the assessee the benefit of deduction u/s. 80IA of the assessee as claimed. 4. On the other hand, the ld.DR submits that the appellant Revenue has preferred an appeal before the Hon'ble High Court of Calcutta against such order dt. 18-06-2013 passed by the Tribunal in assessee's own case. The matter is still pending for adjudication. But he did not provide any document or evidence to show that the Hon'ble High Court of Calcutta has admitted such appeal filed by the revenue and no order contrary to the said order dt. 18-06- 2013( assessee's own case) has been produced by the ld.DR on which the appeal of the revenue is still pending before the Hon'ble High Court of Calcutta for disposal. 5. Taking into consideration the submissions of the ld.AR of the assessee, we proceed to hear the appeal and dispose off the same on merits on the basis of material as available on record. 6. The brief facts of the case are that the assessee is a AOP [Joint Venture] stood successful in getting the bid for engineering, procurement and construction of elevated corridor project at Hyderabad. Accordingly, the assessee entered into an agreement vide dt. 23-06-2006 with the Hyderabad Urban Develop....
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....actor. We find that the assessee stood successful in getting the bid for engineering, procurement and construction of elevated corridor project at Hyderabad awarded for such construction of elevated corridor project in Hyderabad by the HUDA. Thereby the assessee is a developer for the reason that the assessee involved in preparation of design, superintending the labour and technical assistance and responsible for safety and security of the project site. The assessee is also responsible in all respect for the care and risk of the works, materials, goods, equipments (heavy & light ) and labour etc. and also for procurement of licenses, promotion and execution of project work. The assessee is also responsible for the payment of supply of labour, water and electric charges for the project. The assess was responsible and was to pay the cost of strengthening any bridge or altering or improving any road communication necessary for smooth execution of works. The assessee is responsible for making all arrangements for and paying all charges in connection with supply of electricity and water. The assessee was to carry out tests in accordance with law. We also find that the Bombay High Court ....
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....n sub-clause (a) of clause (1) of sub section (4) of Section 801A of the Act refer to the enterprise. By reading of the section, it is clears that the enterprises carrying on development of infrastructure development should be owned by the company and not that the infrastructure facility should be owned by a company. The provisions are made applicable to the person to whom such enterprise belongs to is explained in sub-clause (a). Therefore, the word "ownership" is attributable only to the enterprise, carrying on the business which would mean that only companies are eligible for deduction under section 801A (4) and not any other person like individual, HUF, Firm etc. 27. We also find that according to sub-clause (a), clause (i) of sub section (4) of 80-IA the word "it" denotes the enterprise carrying on the business. The word "it" cannot be related to the infrastructure facility, particularly in view of the fact that infrastructure facility includes Rail system, Highway project, Water treatment system, Irrigation project, a Port, an Airport or an Inland port which cannot be owned by any one. Even otherwise, the word "it" is used to denote an enterprise. Therefore, there is no re....
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....kages and not as a works contract. The assessee utilizes its funds, its expertise, its employees and takes the responsibility of developing the infrastructure facility. The losses suffered either by the Govt. or the people in the process of such development would be that of the assessee. The assessee hands over the developed infrastructure facility to the Government on completion of the development. Thereafter, the assessee has to undertake maintenance of the said infrastructure for a period of 12 to 24 months. During this period, if any damages are occurred it shall be the responsibility of the assessee. Further, during this period, the entire infrastructure shall have to be maintained by the assessee alone without hindrance to the regular traffic. Therefore, it is clear that from an un-developed area, infrastructure is developed and handed over to the Government and as explained by the CBDT vide its Circular dated 18-05-2010, such activity is eligible for deduction under section 801A (4) of the Act. This cannot be considered as a mere works contract but has to be considered as a development of infrastructure facility. Therefore, the assessee is a developer and not a works contrac....
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....rder. The scope of the work is also extracted above. Admittedly, the assessee has taken a turnkey contract from the Irrigation Department, Govt. of Andhra Pradesh. The turnkey contract is in respect of the irrigation project. Irrigation project is an infrastructure facility within the scope of Explanation to section 80IA(4) of the Act. The provisions of section 80IA(4) is to be controlled by the Explanation to section 80IA, which has been substituted by the Finance (No.2) Act, 2009 with retrospective effect from 1-4-2-2000. This Explanation is found after subsection (13) of section 80IA. The said Explanation attempts to control the provisions of sub-section 4. More so, it says that nothing contained in section 80IA would apply in relation to the business referred to sub-section (4), which is in the nature of works contract. A works contract is not defined in section 80IA. Now, what would come into consideration is whether the substituted Explanation after sub- clause (13) changed the nature of the meaning of 'infrastructure facility' provided in the Explanation to section 80IA(4). Admittedly, the Explanation to section 80IA(4) gives the meaning the term 'infrastructure facility'. T....
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....ransfer (BOT) and building owning, operating and transfer BOOT as also PPP contracts does not hold water in so far as an irrigation project can never function under BOT or BOOT or PPP . In the circumstances, we are of the view that the assessee's claim is not hit by the substituted Explanation as provided after sub clause(13) of section 80IA.. Here, we may mention that this view finds support from the decision of the co-ordinate of the tribunal, [ITAT, Hyderabad Bench, Hyderabad in the case of GVPR Engineers Ltd & Ors (refer to supra). We may mention here that our view also finds support from the decision of the co-ordinate bench of this tribunal, ITAT Cuttack Bench, Cuttack in the case of ARSS Infrastructure Projects Ltd Vs. ACIT, Circle-2 (1), Bhubaneswar in ITA Nos. 142, 143/CTK/2010 & 483,484/CTK/2011 dated 13-06-2013, wherein one of us was a party and in which case it has been held as under :- 10. Now coming to the merits of the deduction u/s. 801A(4) of the Act. A perusal of the provisions of section 801A(4) of the Act shows that in the explanation 'infrastructure facility' has been specified to mean a road including a toll road, a bridge or a rail system. Admittedly, the ....