Approval of hotels for the purpose of claiming the various tax concessions envisaged in the Income-tax Act, 1961 - Income Tax - 383/1984

Approval of hotels for the purpose of claiming the various tax concessions envisaged in the Income-tax Act, 1961 Circular No. 383 Dated 22/6/1984 To All Commissioners of Income-tax. Subject: Approval of hotels for the purpose of claiming the various tax concessions envisaged in the Income-tax Act, 1961. Sir, Attention is invited to the Board's U.O. No. XVI/II/77, on the above subject. Vide this Circular, the Department of Tourism in the Ministry of Tourism and Civil Aviation was declared the delegated authority for according approvals under sections 32(1)(v), 33(1)(b)(B)(ii), 80B(7) (since omitted) and s. 80J(6)(d) of the Income-tax Act, 1961, to the domestic companies conducting the business of running hotels. 2. It appears that most of the field officers are not aware of this circular. I am, therefore, directed to enclose a copy of the said circular for their information and guidance. 3. It has, however, been observed that sometimes the administrative approvals granted by the Department of Tourism to domestic companies for running hotels is treated by the income-tax authorities as the approval under the various sections of the Income-tax Act. This is not correct. The administrative approval of the Department of Tourism for running a hotel is something absolutely different from the approvals granted by that Department in the capacity of a delegated authority enabling the companies to avail of the benefits under the various sections of the Income-tax Act. The Board have been advised that the hotel industry must come up before the delegated authority and seek approvals under the specific sections of the Income-tax Act. The benefits under the various sections of the Income-tax Act referred to above should be given to the hotel industry only if they have in their possession specific approvals under the above sections and not on the basis of administrative approvals for running the hotel industry. Yours faithfully, (Sd.) P. Saxena, Secretary, Central Board of Direct Taxes.