Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2016 (8) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2016 (8) TMI 995 - AT - Income TaxEligibility for claiming deduction u/s. 80IA(4) - civil contract business - The work was allotted by DRDO, Ministry of Defence, Govt. of India for construction of rain water harvesting reservoir, i.e., the development of infrastructure facility. - Held that:- As per section 80IA(4), the appellant should be engaged in the eligible business as defined in the section. For this, it was also to be examined and enquired by the revenue authorities from the agreements and the ground activities of appellant in compliance thereto as to who supplied the drawings and designing etc. of the project. It was also to be enquired as to what was the assessee’s risk in the project. The Revenue authorities also did not examine the nature of payments received by the assessee – whether it was disbursed by the contractee on the basis of M.B (Measurement Books) of the project, which is the basic record for making payment by the contractee or it was disbursed otherwise. In case the assessee is found to have received the periodic payment as per periodical measure book records of the project, then the assessee cannot be termed to be developer, as in that case no financial risk of the assessee would be there in the project. Furthermore, as per provisions of section 80IA, the eligible entity who claims himself to be a developer for the purpose of this section, is required to maintain separate books of account for the project and according to those accounts, correct profit has to be calculated. This aspect has also to be enquired by the Revenue authorities. If the Revenue Authorities find that the assessee has acted as developer, then he has to examine whether correct profit is deduced from the separate accounts required to be maintained by the assessee as per provisions of section 80IA of the Act. In view of all this discussion, we conclude that the lower authorities have not made thorough enquiry in the matter regarding the nature of agreements, terms of payments, maintenance of account books with respect to the project separately etc. before denying the claim of the assessee u/s. 80IA (4). However, for want of proper enquiries and in absence of correct facts emerged out of such enquiries, the decisions relied upon by the assessee, in our opinion, do not render any help to the assessee. We accordingly deem it proper in the interest of justice to restore the matter to the file of ld. Assessing Officer to decide the matter de novo after making proper enquiry as discussed above. The assessee is also directed to cooperate with the AO in fresh assessment proceedings. Needless to say, the assessee shall be given reasonable opportunity of being heard. - Decided in favour of assessee for statistical purposes.
|