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2013 (9) TMI 228 - AT - Income TaxDeduction u/s 80IA - Nature of the business - developer versus Work contract - ownership - Held that:- The word "it" cannot be related to the infrastructure facility, particularly in view of the fact that infrastructure facility includes Rail system, Highway project, Water treatment system, Irrigation project, a Port, an Airport or an Inland port which cannot be owned by any one. Even otherwise, the word "it" is used to denote an enterprise. Therefore, there is no requirement that the assessee should have been the owner of the infrastructure facility. The Government does not provide any material to the assessee. It provides the works in packages and not as a works contract. The assessee utilizes its funds, its expertise, its employees and takes the responsibility of developing the infrastructure facility. The losses suffered either by the Govt. or the people in the process of such development would be that of the assessee. The assessee hands over the developed infrastructure facility to the Government on completion of the development. Thereafter, the assessee has to undertake maintenance of the said infrastructure for a period of 12 to 24 months. During this period, if any damages are occurred it shall be the responsibility of the assessee. Further, during this period, the entire infrastructure shall have to be maintained by the assessee alone without hindrance to the regular traffic. Therefore, it is clear that from an un-developed area, infrastructure is developed and handed over to the Government and as explained by the CBDT vide its Circular dated 18-05-2010, such activity is eligible for deduction under section 80IA (4) of the Act. This cannot be considered as a mere works contract but has to be considered as a development of infrastructure facility. Therefore, the assessee is a developer and not a works contractor as presumed by the Revenue. Following the decision in The Deputy CIT, Hyderabad Versus M/s. Koya & Company Constructions Pvt. Ltd. [2012 (5) TMI 158 - ITAT HYDERABAD ] and M/s. Sushee Hitech Constructions P. Ltd. (Now known as Sushee Infra P. Ltd.) Versus Income-tax Officer, Ward 3(2), Hyderabad [2013 (6) TMI 599 - ITAT HYDERABAD] - Decided against Revenue.
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