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2018 (2) TMI 2040 - AT - Income TaxDisallowance of deduction u/s 80IAB - income derived from 'Operation and Maintenance Activities' of SEZ are not eligible for such deduction - HELD THAT:- We find that the issue is no longer res integra. The Co-ordinate bench of Tribunal in Revenue’s appeal relevant assessment year 2010-11 [2017 (10) TMI 1578 - ITAT AHMEDABAD] has dismissed the appeal of the Revenue and thus allowed the deduction claimed on operation and maintenance activity. From going through the proviso (2) of section 80-IAB of the Act gives a very clear picture that when the transferee is eligible for deduction u/s 80-IAB for the income from operation and maintenance of SEZ then certainly transferor i.e. developer is eligible for deduction u/s 80-IAB from operation and maintenance. Also going through the letter issued by Government of India Ministry of Commerce & Industries dated 21st June, 2006 to the assessee for setting up of a sector specific Special Economic Zone for Pharmaceuticals at Ahmedabad, we find that in clause (ii) under the main clause (III) referring to general condition it reads that operation and maintenance of the facilities will be met as per the standard in the specific manner and proposition of the user. In view of our above discussion as well as observation made by Id. CIT(A), we are of the view that assessee being a developer of SEZ is eligible for deduction u/s 80-IAB for income earned from operation and maintenance of SEZ - Decided in favour of assessee.
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