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2014 (4) TMI 389 - AT - Income TaxNon-allowance of deduction u/s 80IA(4) of the Act – Held that:- The assessee is a developer and not only a works contractor with respect to other projects - the assessee is converting the area entrusted to it into more useful and more profitable area and handing over the developed one to the Government/Government Bodies - the activity of the assessee is "to develop" an existing two lane road into four lane road thereby making the road more useful and profitable - The decision in M/s. KMC Constructions Ltd. Versus Dy. Commissioner of Income-tax, Circle 2(1), Hyderabad [2013 (8) TMI 831 - ITAT HYDERABAD] followed - Assessee should not be denied deduction u/s 80IA of the Act as the contracts involves, development, operating, maintenance, financial involvement, and defect correction and liability period, then such contracts cannot be called as simple works contract - Contracts needs to be segregated and on this deduction u/s. 80IA has to be granted and the other agreements which are pure works contracts hit by the explanation section 80IA(13), those work are not entitled for deduction u/s. 80IA of the Act - The profit from such is to be computed by assessing officer on pro-rata basis of turnover – thus, the assessee is entitled for deduction u/s 80IA(4) – the order of the CIT(A) upheld – Decided against Revenue.
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