TaxTMI 
TaxTMI 
2018 (2) TMI 1519
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....raised cross-objections against both the appeals. Since common issues are involved in these appeals, we have heard them together and decided by this common order. 2. Briefly stated, assessee-company is engaged in manufacture of pipes for water supply and sewerage scheme and also turnkey contractors in infrastructure sector. For the AY. 2012-13, assessee has declared income of Rs. 62,62,130/-, after claiming deduction u/s. 80IA of the Income Tax Act [Act]. Assessment was completed by the Assessing Officer (AO) making the following additions/disallowances: i. Claim of deduction u/s. 80IA - Rs. 1,11,16,842/- ii. Disallowance u/s. 40(a)(ia) - Rs. 19,59,12,583/- iii. Disallowance u/s. 43B - Rs. 1,68,00,000/....
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....e not eligible for deduction. It was the submission of the Ld. Counsel that assessee is involved both as contractor as well as infrastructural developer and the claim was made only the extent of projects which are as infrastructural developer and furnished the details of works undertaken. i. Infrastructural contracts (6 projects) - Rs. 30,25,56,324 ii. Infrastructural Projected executed directly - Rs. 41,42,59,321 4.3. It was submitted that claims were made only on the direct infrastructural projects which were to the extent of Rs. 57.59% and not on full contracts executed by assessee. Further, Ld. Counsel has placed on record the orders in AYs. 2010-11 and 2011-12, wherein the matter was referred to the AO who af....
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.... However, while passing the order the A.O. has stated that certain contracts were not eligible for deduction under section 80IA. This which seems to have been quantified in an annexure was not placed on record. Learned Counsel for the Assessee has stated that the claim made was only with reference to the infrastructure projects and not on work contracts which the assessee itself has segregated and claimed. However, he has no objection if this aspect is verified by the A.O. Therefore, while agreeing with the order of the CIT(A) in granting the deduction under section 80IA, subject to verification of quantum of income on the eligible infrastructure projects, as per the directions of the ITAT in earlier years. Revenue grounds are accordingly p....
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.... "6.6. In the instant case, the assessee has paid the amount without deducting the tax. As it is evident from the facts that the assesee has already paid the sub contract/other expenditure of Rs. 19,59,12,583/during the year itself and nothing was payable as on 31st March and this fact was not disputed by the AD also. Therefore, the issue involved is squarely covered by the ratio laid down by the Hon'ble ITAT, Spl.Bench, Visakhapatnam and the Hon'ble ITAT, Hyderabad 'A' Bench in the cases of Merilyn Shipping & Transport and Janapriaya Engineering Syndicate (mentioned supra) respectively. 6.7. In view of the above, I am of the considered opinion that the action of the AO is not justified in making the said disallow....
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....o. 160 of 2015] dt. 28-08-2015, the disallowance u/s. 40(a)(ia) could not be made, if assessee is not treated as assesseein- default. It was further submitted that assessee is in a position to produce the certificates that the payee has included the amount received from assessee in its returns and has paid entire taxes on the income. Since these issues are not examined by the AO, we are of the opinion that the disallowance u/s. 40(a)(ia) is required to be re-considered by the AO, after giving due opportunity to assessee. For this purpose, orders of AO and CIT(A) on this issue are set aside and the matter is restored to the file of AO. Deduction u/ 80IA: 7. One more issue involved in AY. 2012-13 is with reference to objections of Reven....
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.... addition is made towards the discrepancies in vouchers and the addition is treated as business income. Once the addition is resulted in business income, on the same logic corresponding is to be given. This ground of the assessee is allowed. " 7.4. Since the issue involved in the appeal is similar with that of the decision mentioned supra, the assessee is entitled for deduction u/s.80IA(4) on this amount of Rs. 1,68,00,000/-. Hence, the AO is directed to recompute the deduction u/s. 80IA after taking into account the said amount of Rs. 1,68,00,000/- to the profits of the assessee and corresponding deduction may be given. As a result, the alternate grounds raised by the AR are allowed". 7.1. The amount of Rs. 1,68,00,000 was disa....