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M/s. Patel KNR, JV, M/s. KNR Patel, JV Versus ACIT, Circle-24 (1) , Mumbai

2016 (7) TMI 204 - ITAT MUMBAI

Disallowance u/s.80IA(4)- income derived from activity of development of eligible infrastructural facilities - Held that:- As decided in assessee's own case for AY 2008-09 the assessees of this kind are deemed fulfilling the conditions specified in the said sub-section (4) of Section 80IA of the Act. It is the finding of the Hyderabad Bench of the Tribunal in the case of' M/s KMC Constructions Ltd (2012 (5) TMI 181 - ITAT HYDERABAD ) that the contractor, who undertakes for road Widening of the N .....

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y a single common order as combined issues are involved. Assessee -AOP.s are engaged in executing civil contracts and construction of roads, highways etc. ITA No.7155/Mum/2008-(AY 2005-06) : 2. The effective Ground of appeal is about disallowance of claim made by the assessee u/s.80IA(4) of the Act in respect of income derived from activity of development of eligible infrastructural facilities. In this case original order was completed on 31.12.2007, u/s. 143(3) of the Act by the AO. He held tha .....

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elgaum) Construction Pvt. Ltd. (ITA No.1048 & 1049/Pune/2003) that on 26.10.2009 the Third Member decided the issue against B.T. Patil & Sons (Belgaum) Construction Pvt. Ltd. As per the provisions of section 255(4) of the Act the case of BT Patil was referred back to the Division Bench of the Tribunal to give effect in conformity with the opinion of the Third Member. The regular Bench following the judgment of Hon'ble Bombay High Court delivered in the case of ABG Heavy Industries Lt .....

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n u/s. 80IA(4) of the Act to the assessee with regard to the projects in question for both the years. The matter is disposed off accordingly. Assessee brought the above facts before the Hon'ble Bombay High Court therefore, the matter was remanded back to the Tribunal. 4. During the course of hearing before us the Authorised Representative brought to our notice that in case of Patel KNR, JV the Tribunal had decided identical issue in favour of the assessee (ITA No.5230/Mum/2012, AY 2008-09, d .....

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d relevant facts of the case are that the assessee is a Joint Venture(JV) between Patel Engineering Ltd. and KNR Constructions Ltd. and is engaged in business of Construction of Road, Highways and other infrastructure projects. Assessee filed the return of income declaring the total income of Rs. Nil after "claiming deduction u/s. 801A ( 4) on one project namely AS-18 " of ₹ 9,95,41,994/- which was restricted to gross total income of ₹ 3,02,81,419/-.Assessment was completed .....

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the developer and as such, the assessee could not substantiate its claim therefore, the claim of the assessee was not accepted. In support of his decision, AO relied on the decision of the Larger Bench of the ITAT in the case of M/s. B.T. Patil & Sons Belgaum Construction Pvt Ltd reported in 126TTJ (Mum) TM wherein the assessee was one of the intervener" and it was held that, executing a mere works contract is not entitled to deduction u/s 80IA(4). Further, AO restricted the TDS credit .....

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it is not proper. Before the CIT(A), assessee relied on various decisions i.e., the judgment of the Jurisdictional High Court in the case of ABG Heavy Industries Ltd. W reported in 322 ITR 323 (BOM); order of the ITAT, Hyderabad "Bench in the case of GVPR Engineers Ltd vs. ACIT [21 Taxmann.com 246] (Mum); Laxmi Civil Engg. P. Ltd vs. Addl. CIT (ITA No.766/PN/09, 254/PN/08, 431/PN/07). It was demonstrated before the CIT(A) that the Larger Bench decision in the case of B.T. Patil & Sons B .....

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ions. He also discussed the meaning of 'contractor" and "developer' and elaborated the scope of contract. Para 2.15 of the CIT(A)'s order is relevant 'in this regard. There was a discussion in his order on the various clauses of the contract to conclude that the assessee has all the responsibility in, executing the contract works. Further, the CIT(A) analyzed the way the AO rejected the applicability of the binding judgment of the Hon'ble High Court in the case of A .....

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judgment of the ITAT, Hyderabad Bench in the case of M/s. KMC Constructions Ltd vs. CIT, 21 Taxmann.com 138 (Hyderabad), dated 16.3.2012 which belongs to the subsequent period to the cited Larger Bench decision 'in 'the case of B.T. Patil & Sons Belgaum Construction Pvt Ltd (supra). In fact the CIT(A) extracted the para 46 to 44 of the said order of the Tribunal in the, case of M/s. KMC Constructions Ltd (supra) and directed the AO to allow the deduction claimed u/s. 80IA( 4) of the .....

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