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2014 (9) TMI 82 - AT - Income TaxDenial of deduction u/s 80IA(4) - Buffer agency granting work contract of local bodies on behalf of the Government of Gujarat and not as a developer of infrastructure facility – Held that:- As decided in assessee’s own case it has been held that assessee’s works as a nodal agency for implementation of various works undertaken/decided by the government - on a project originally estimated at ₹ 100 crore, the actual cost over runs to any amount may be even ₹ 500 crore; the assessee loses nothing - its own allocation increases and it gains - it doesn't get any benefit when it saves cost or is more efficient - the appellant is doing the work of a concern engaged in work which is in the nature of a works contact awarded by any person (including the Central or State Government) and executed by it - as per the amended Explanation below section 80IA(13) with retrospective effect from 1.4.2000, the work should not be of the nature of contract and not only contract - the project costs and source not being revenue of the appellant, it being not affected by the actual cost and efficiency of work, the assets created and the source not being of the appellant at any stage and it being entitled to a fixed remuneration for its professional services; it clearly is falling in the excluded category as per the amended Explanation below section 80IA(13); and therefore, not eligible for deduction - the objections of the CIT(A) was that the assessee does not bear any risk and consequences arising from the project – Decided against assessee. Interest on unutilized grants as income from other sources – whether taxable or part of grant received from the government and not taxable - Held that:- the assessee is 100% government owned company appointed as a Nodal Agency for implementation of various infrastructure development projects all across Gujarat - the observation of the AO that the interest is not credited to the respective Grant accounts is factually incorrect, as a perusal of the balance-sheet and the respective ledger accounts of the Grant/Project clearly show that in fact the interest is credited to the respective account. - Earlier decision of the same assessee [2014 (4) TMI 789 - ITAT AHMEDABAD] followed - interest is not taxable – Decided in favour of Assessee.
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