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2014 (1) TMI 386 - AT - Income TaxDeduction u/s 80IA of the Act - Deduction u/s 80IA after reducing amount of depreciation on WEG’s allocated on pro-rata basis – Held that:- deduction under section 80-IA is to be computed after setting off the depreciation relatable to the wind mill against the income earned out of electricity generator which qualified for deduction under sec. 80-IA of the Act. Allowance of eligible and non eligible units - Held that:- It has been excluded from the computation for the purpose of sec. 80IA of the Act – Thus, deduction under section 80-IA is to be computed after setting off the depreciation relatable to the wind mill against the income earned out of electricity generator which qualified for deduction under sec. 80-IA of the Act - assessee has been treating each WEG as a separate unit and claiming the deduction – Following Dalmia Cement (Bharat) Ltd. Versus Additional Commissioner of Income-tax, Range-10, New Delhi [2009 (5) TMI 623 - ITAT DELHI] – The depreciation allowable to each unit whether unabsorbed or present year has to be allocated against the profit of that unit before computing the deduction admissible to the assessee under sec. 80-A – the issue remitted back to the Assessing Officer for recomputation of deduction admissible under section 80-IA of the Act - the deduction should not exceed the ceiling of gross total income – Decided in favour of Revenue. Deletion u/s 40(a)(ia) of the Act – Applicability of Section 194 C of the Act - Nature of Payment – Contract of service OR Rent for hiring a plant – Held that:- Following Commissioner of Income-Tax Versus Prasar Bharti (Broadcasting Corporation of India) [2006 (11) TMI 159 - DELHI High Court ] - According to the contract, the travel agency has to ply the bus for a fixed number of hours - Thus, it is a simplicitor service contract for transportation of the passengers and it falls within the ambit of clause (c), Sr. No.(IV) of explanation appended to sec. 194C - assessee has just hired the transportation facilities which is akin to hiring of a taxi though on regular basis for a fixed number of hours – As per Board’s Circular No. 558 dated 28.3.1990, where a vehicle is given on hire along with provisions of a driver for use of carrying of the passengers for fixed hours than it is a service contract for carrying out the work - It will be covered under sec. 194C of the Act because the vehicle has been made available as a matter of service - it is a service contract and assessee was to deduct tax under sec. 194 C of the Act - The assessee has availed the services of cranes which were operated by the contractee - Assessing Officer has erred in construing that assesse has paid rent and its case falls under sec. 194I of the Act – Decided Against Revenue.
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