Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2013 (11) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2013 (11) TMI 197 - ITAT PUNEWhether the Tribunal while complying with the provisions of section 255(4) of the Act can consider the judgment of the Hon'ble High Court in the case of ABG Heavy Industries. Disallowance of Deduction u/s 80IA(4) - development of infrastructure facility as a whole or in part - Held that:- Taking the substance of the transaction, the assessee were entitled to all the profits in respect of the contract executed by them, hence the assessee would certainly be entitled to deduction under the provisions of 80IA as they have fulfilled all the other conditions - the Assessing Officer was directed to allow deduction u/s.80IA(4) of the Act to the assessee with regard to the projects in question for both the years - Following Deputy Commissioner of Income-tax, Central Circle-36, Mumbai Versus ABG Heavy Industries Ltd. [ 2010 (2) TMI 108 - BOMBAY HIGH COURT] and Ayush Ajay Construction Ltd. vs ITO [2000 (7) TMI 225 - ITAT INDORE ]. The assessee Company had been included as a sub-contractor for the all the other projects either the contracts were directly in the name of assessee company or in the name of the joint venture enterprise - The fact that the assessee had a tripartite agreement with the relevant authorities makes the assessee a party to the main contract work itself and which clearly shows that the assessee on their own right are contractors and not just sub contractors as normally understood - The assessee was the contractor vis-a-vis the portion allotted to them and not only subcontractors, i.e. a direct party to the main agreement - The assessee had entered into a main agreement, in their own right, can claim the benefit of section 80IA - assessee was otherwise fulfilling all the conditions they were entitled to deduction under the provisions of section 80IA. The action of the assigning and the work of construction undertaken by the assessee was recognised by the State Government and a tripartite agreement was executed between the assessee and the State Government through which the State Government had recognised that the assessee had stepped into the shoes of assessee and notified authorising the assessee to collect the toll tax for a particular period - Since the assessee company had rectified all act and deeds of its promoter and owned all the assets and liabilities of its promoter through an agreement of assignment executed between the assessee and ‘A’ after obtaining approval from the State Government, the assessee should be deemed to have undertaken the construction work since 1-4-1995 - Since the Government had provided this deduction in order to encourage economic growth of the country, the plenitude of exemption should not be whittled down, by laying stress on ambiguity here and there - If it was proved that, the assessee-company had obtained the status of a tenderer by virtue of a valid assignment, it should not be denied the benefit of deduction provided by the Central Government through introduction of sub-section (4A) of section 80 IA - The action of assessee could only be termed as a valid tax planning which was permissible under the law. Therefore, the assessee had fulfilled the requirements provided in section 80IA (4A)(ii) for claiming deduction, and, therefore, the Assessing Officer should have allowed the deduction claimed by the assessee company - Decided in favour of Assessee.
|