TMI Blog2018 (4) TMI 184X X X X Extracts X X X X X X X X Extracts X X X X ..... HMA CHOWLA, JM: The appeal filed by the Revenue is against the order of CIT(A)-II, Pune, dated 04.01.2014 relating to assessment year 2005-06 against order passed under section 143(3) r.w.s. 147 of the Income-tax Act, 1961 (in short the Act ). The assessee filed Cross Objections against the appeal of Revenue. 2. The appeal filed by the Revenue and Cross Objections filed by the assessee were heard together and are being disposed of by this consolidated order for the sake of convenience. 3. The Revenue in ITA No.948/PUN/2014 has raised the following grounds of appeal:- 1) The Learned Commissioner of Income-tax (Appeals) erred in allowing deduction u/s.80IA(4) of the Income tax Act, 1961. 2) The Learned Commissioner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the given facts circumstances of the case the assessee was certainly a contractor and not a developer. 6) The Learned Commissioner of Income-tax (Appeals) erred in not appreciating the concept of developing and in equating the same with contracting and in holding that Explanation to sub section (13) of section 80IA would apply to a sub-contractor and not to a contractor. 7) The Learned Commissioner of Income-tax (Appeals) erred in not appreciating the fact that the contractee agencies had deducted tax at sources u/s.194C from the payments made to the assessee which substantiates the contractor-contractee relationship between the assessee and the developing agencies. 4. The assessee in CO No.10/PUN/2016 has raised the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessee filed objections against reopening of assessment and also in support of claim of deduction under section 80IA(4) of the Act. The Assessing Officer was of the view that where specific contract work was entrusted to the assessee by Executive Engineer, Irrigation Department, Ratnagiri on tender basis, then the assessee cannot be held to be in the business of developing, operating and maintaining infrastructure facilities as envisaged under section 80IA(4) of the Act, but merely carried out work contract assigned to it by the State Government. Hence, the claim of deduction under section 80IA(4) of the Act was denied to the assessee. 7. The CIT(A) first decided the issue of reopening of assessment under section 147 / 148 of the Act ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... work contract entered with the undertaking or enterprise, as the case may be. The said Explanation inserted by Finance Act, 2007 with retrospective effect from 01.04.2000. The CIT(A) observed that since the assessee was a developer being the principal party executing work in pursuance of agreement with the Government and the Explanation refers to a contract entered into with the undertaking or enterprise and not with the Government of India, hence, it denies relief only to the sub-contractors and not the principal contractors. Reliance in this regard was further placed on the decision of the Hon ble Bombay High Court in its order dated 24.01.2013. On similar issue in the case of B.T. Patil Sons, Belgaum Construction Pvt. Ltd. Vs. ACIT (20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it was the developer. The case of Assessing Officer on the other hand, was that the assessee was only a contractor as the said work was awarded. The CIT(A) vide para 4.1 has noted the submissions of assessee vis- -vis nature of said development work carried out by the assessee and has held that it is not works contract. Further, reliance was placed on the ratio laid down by the Hon ble Bombay High Court in CIT Vs. ABG Heavy Industries Ltd. (supra). 12. We find that the issue of allowability of claim of deduction under section 80IA(4) of the Act has arisen before the Tribunal in the case of ACIT Vs. Mahalaxmi Infraprojects Ltd. in ITA Nos.142 to 147/PUN/2016, relating to assessment years 2007-08 to 2012-13, order dated 17.01.2018, wherein ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the grounds on which the said deduction was not allowed to the assessee that the assessee was a contractor. The Tribunal vide paras 127 to 129 at pages 72 to 75 of the order dated 09.12.2015 held the assessee to be entitled to claim the deduction under section 80IA(4) of the Act considering the fact that irrigation project of assessee was an infra project. It also noted the decision in favour of assessee by the Tribunal in assessee s own case for assessment year 2003-04 vide ITA No.433/PN/2007, order dated 06.02.2012. The relevant findings of the said order of Tribunal are reproduced under para 128 of the order of Tribunal. Hence, in 153A proceedings, after search on the premises of assessee, the first issue which was adjudicated by the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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