TMI Blog2019 (3) TMI 1859X X X X Extracts X X X X X X X X Extracts X X X X ..... pany is not entitled to deduction u/s. 80IA(4) of the Act in respect of the toll fee collected during the concession period. The ld. CIT(A) had misdirected himself in directing the AO to allow the deduction u/s. 80IA of the Act. Therefore, we reverse the findings of ld. CIT(A) on this issue - Decided in favour of revenue. - ITA No.1790/Chny/2017 & C.O No.137/Chny/2017 - - - Dated:- 29-3-2019 - SHRI N.R.S. GANESAN AND SHRI INTURI RAMA RAO, JJ. Appellant by: Shri M. Srinivasa Rao, CIT Respondent by: Shri N.V. Balaji, Advocate ORDER INTURI RAMA RAO, J. This is an appeal filed by the Revenue and the Cross Objection (CO) filed by the assessee-company directed against the common order of the learned Commissioner of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct from the AY 2014-15. 3. For these and other grounds that may be adduced at the time of hearing, it is prayed that the order of the learned CIT(A) may be set aside and that of the Assessing Officer restored. 4. The brief facts of the case are as under: The respondent-assessee is a company incorporated under the provisions of the Companies Act, 1956. It is engaged in the business of development of infrastructure. The return of income for the AY 2014-15 was filed on 30.09.2014 disclosing Nil income. Against the said return of income, the assessment was completed by ITO, Ward-4(4), Chennai (hereinafter called as AO ) vide order dated 30.12.2016 passed u/s. 143(3) of the Act at total income of ₹ 38,24,23,617/-. The respo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... B along with return of income was filed. 5. Being aggrieved, an appeal was preferred before ld. CIT(A), who vide impugned order had directed the AO to allow deduction u/s. 80IA of the Act after considering the CBDT Circulars governing the issue and the Hon'ble Supreme Court decision in the case of CIT v. GM Knitting Industries (P.) Ltd. [2015] 376 ITR 476 (SC). Being aggrieved by the above decision by the ld. CIT(A), the Revenue is in appeal before in the present grounds of appeal. 6. It is contended that furnishing of audit report in prescribed form along with the return of income is mandatory therefore, the ld. CIT(A) ought not have held that filing of audit report is only directed in nature the ld. Departmental Representative a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vernment or a local authority or any other statutory body for development or operating and maintaining a new infrastructure facility, it fulfills prescribed conditions and deriving income from such business is eligible to deduction and deriving income from eligible business is sine qua non to be eligible for deduction but, in the present case, admittedly, the assessee-company had not derived any profits from the activities of developing or operating and maintaining any infrastructure facilities. It is only in the process of developing infrastructure facilities. There is no nexus between the toll fee collected and the development of infrastructure facilities and therefore, the assessee company is not entitled to deduction u/s. 80IA(4) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dice to the above, the Assessing officer ought to have treated 40% of the Interest cost incurred (till 31.03.2014) in connection with the toll project as Viability Gap Funding. 5. Without prejudice to the above, where the toll collected are deemed to be in nature of income, the assessing officer ought to have allowed the total cost incurred by the appellant as deduction in computing the taxable profits. 6. Without prejudice to the above, the assessing officer ought o have appreciated that the strengthening cost and administrative and maintenance cost are revenue in nature and should be allowed as deduction in computing the taxable profits. 7. The assessing officer erred in denying the adjustment of the other income against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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