Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2020 (2) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (2) TMI 827 - AT - Income TaxDeduction u/s. 80IA - Fluoride Removal Unit and Arsenic Removal Units - assessee engaged in the business of developing, operating and maintaining community water system and contamination removal water system - HELD THAT:- Explanation to section 80IA(4) makes it clear that infrastructure facility means a water supply project, water treatment system, irrigation project, sanitation and sewage system or solid waste management system. From the above, it is abundantly clear that the assessee shall be entitled for deduction u/s. 80IA(4) with respect to operating and maintaining of the water treatment system / water supply project. It is also clear that the assessee is not a developer but only operating and maintaining the water treatment system / water supply project. The contract work entrusted to the assessee for procurement and supply of water treatment system / water supply project will obviously not fall under the ambit of section 80IA (4) which the Ld. CIT (A) had also made it clear in his order by disallowing the deduction for supplying Fluoride Removal Unit and Arsenic Removal Units and it is appropriate. For procuring, supplying and erecting water treatment plant by virtue of job contract, the assessee will not be entitled for deduction U/s. 80IA(4) of the Act unless he is a developer and from the facts of the case it is apparent that the assessee is not a developer. Accordingly, we hereby hold that:- (i) The assessee shall be entitled for the benefit of deduction u/s. 80IA(4) of the Act with respect to the profit earned out of operating and maintaining water treatment system / water supply project; (ii) However, the assessee shall not be entitled for benefit of deduction u/s. 80IA(4) of the Act with respect to the profit earned by supplying and erection of water treatment system / water supply project / Fluoride Removal Unit and Arsenic Removal Units as it is not a developer but only engaged in the task as works contractor.
|