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2018 (2) TMI 1519 - AT - Income TaxClaim of deduction u/s. 80IA - denial of claim as AO was of the view that assessee is only executing works contract as a contractor and not as a developer of infrastructural facilities - Held that:- At the out set, it is to be agreed that the issue is covered in favour of assessee by the orders of the ITAT in earlier years in assessee’s own case which the Ld.CIT(A) has followed. Consequently, we do not see any reason to interfere with the order of CIT(A), as there seems to be no change in facts and circumstances of the case in the years under appeal. However, AO has not distinguished on what percentage assessee has claimed u/s. 80IA and what are the contracts undertaken. In earlier years, as seen from the orders of AYs. 2010-11 and 2011-12, AO has issued an annexure, identifying various projects. The matter was sent back to AO for verification. In view of that, since assessee ascertains that it has claimed only the deduction on infrastructural projects undertaken by it, AO is directed to examine this aspect and allow the claim after verification as in earlier years. The ground is considered partly allowed for statistical purposes Disallowance u/s.40(a)(ia) - amounts on which TDS was not deducted or TDS deducted but not paid - CIT-A restricted the disallowance only to the amount of TDS deducted and not paid in AY. 2012-13 - Held that:- As the issue is now decided by the Hon'ble Supreme Court of India in the case of Palam Gas Service Vs. CIT [2017 (5) TMI 242 - SUPREME COURT] in which it was held that even the amounts paid during the year are also covered by the provisions of Section 40(a)(ia), the Special Bench decision of the ITAT in the case of Merilyn Shipping and Transport Ltd., Vs. ACIT (2012 (4) TMI 290 - ITAT VISAKHAPATNAM) is no longer a valid one. Consequently, the order of CIT(A), relying on the above, for giving relief is to be set aside. Allowance of deduction u/s. 80IA on the amount disallowed u/s 43B - Held that:- The amount disallowed u/s. 43B will become profits of business in the computation of income under the head ‘business’ or ‘profession. Consequently, if the amounts disallowed are pertaining to the projects on which the claim u/s 80IA was made, the same has to be allowed as profits get increased to that extent. AO is directed to the examine working of profits and allow the claim. The grounds raised by revenue has no merit.
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