TaxTMI 
TaxTMI 
2019 (4) TMI 861
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....ady reference : "1. Whether the Appellate Tribunal is right in law in holding that the Assessee is eligible for deduction u/s.80IA (4) of the Income Tax Act ? 2. Whether the Appellate Tribunal is correct in law in holding that the Assessee is a "Developer" and not "Contractor" and, therefore, is eligible for deduction u/s. 80IA (4) of the Income Tax Act,1961 ? 3. Whether the Hon'ble Tribunal is correct in law in allowing Assessee's claim towards Foreign Exchange Loss, without appreciating the fact that the Assessee did not produce any proof before the Assessing Officer of business for import of various raw materials, as claimed before the Ld. CIT(A) as well as before Hon'ble Appellate Tribunal ?" 3. As far as first two questions regarding eligibility of the Assessee-Contractor involved in the Development of Infrastructure Facility of Sewerage Plants under the contracts entered into by it with the local Municipal authorities is concerned, the learned Tribunal has categorically found that the Assessee had entered into contract with Municipal Corporations and Local Bodies for undertaking the said Development of Infrastructure Facility and was,....
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....structions Ltd., and several other decisions of the various benches. We found that the assessee company undertakes the entire responsibility from concept to Commissioning of developing the entire facility. Based on customer specifications, conceives the designs and technical plans, chooses the technology required for treatment of the effluents and executes the project through a skilled team of more than 250-300 engineers. The work performed includes the basic design of the plant, detailed engineering, procurement of equipment and components, delivery of supplies at site, civil construction of the structure, installation of equipment at site, interfacing through piping and cables, testing and commissioning and subsequent O&M. The assessee company having working capital facility from earlier years and investments are made in project in each year below : Assessment Year Receivables Rs. Margin Money Deposit with Banks in Rs. Bank Guarantees 2002-03 8,94,65,141 6,80,000 13,37,42,649 2003-04 9,15,83,458 80,000 41,18,50,954 2004-05 22,19,79,451 80,000 55,90,27,996 2006-07 69,68,13,089 58,53,877 1,16,90,76,966 2007-08 ....
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.... The assessee is unable to establish as to how it had made investment in the project. Apart from that, the assessee is not able to prove that it has not executed the work contract by producing relevant material to contradict the finding given by the Assessing Officer. We, therefore, hold that the assessee is a works contractor.' We found that co-ordinate bench decision of this Tribunal above considered the facts for denial of claim that the assessee has not demonstrated how the projects are funded. In the present case, Ld. AR of the assessee has demonstrated the investments of the company in project from the assessment year 2002-03 to 2007-08 consisting of Receivables, Margin Money with the bank, and Bank Guarantees for performance guarantee. These financial aspects prove that the assessee company has funded finances in infrastructure and execution of projects. We are of the opinion that the assessee has complied the conditions u/s.80IA(4) of the Act and demonstrated the funding of the projects with financial statements..." 4. As far as the question involved for Assessment Year 2006- 2007 regarding Foreign Exchange Loss on account of fluctuations due to cha....
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....Government or a State Government or a local authority or any other statutory body for (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining a new infrastructure facility; (c) it has started or starts operating and maintaining the infrastructure facility on or after the 1st day of April, 1995: Provided that where an infrastructure facility is transferred on or after the 1st day of April, 1999 by an enterprise which developed such infrastructure facility (hereafter referred to in this section as the transferor enterprise) to another enterprise (hereafter in this section referred to as the transferee enterprise) for the purpose of operating and maintaining the infrastructure facility on its behalf in accordance with the agreement with the Central Government, State Government, local authority or statutory body, the provisions of this section shall apply to the transferee enterprise as if it were the enterprise to which this clause applies and the deduction from profits and gains would be available to such transferee enterprise for the unexpired period during which the transferor enterprise would have been entitled to ....
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....ese are, obviously, big infrastructure facilities for which the enterprise in question should enter into a contract with the Central Government or State Government or Local Authority. However, the Proviso intends to extend the benefit of the said deduction under Section 80IA of the Act even to a transferee or a contractor who is approved and recognised by the concerned authority and undertakes the work of the said development of infrastructure facility or only operating or maintaining the same. The Proviso to sub-section (4) stipulates that subject to the fulfillment of conditions, the transferee will be entitled to the said benefit, as if the transfer in question had not taken place. It has been found by the Assessing Authority himself, in the present case, that the present Assessee M/s.Chettinad Lignite Transport Services Private Limited under an Agreement dated 16.04.2002, captioned as Lignite Transport System with M/s.ST-CMS Electric Company Private Limited, had undertaken the work of developing the said railway sidings and was operating and maintaining the same. The only ground on which, the Assessing Authority denied the said benefit was that the Assessee himself did not ente....