TMI Blog2017 (3) TMI 1896X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case under consideration and the facts in assessee s own case for A.Y. 2006-07 nor placed any material on record to demonstrate that the decision of Tribunal in assessee s own case for A.Y. 2006-07 [ 2013 (4) TMI 758 - ITAT PUNE] has been set aside by the Higher Judicial Authorities. With respect to the interest income being eligible for deduction u/s 80IA(4), we find that Ld. CIT(A) has given a finding that the fixed deposit was an essential part for availing the loan whereby assessee was required to maintain Debt Services Reserve account and for that purpose it had to necessarily place fixed deposit and on such fixed deposits the assessee had earned interest. He therefore held it to be connected with the business of the assessee. CIT(A) thereafter relying on the various decisions cited therein has allowed the claim of the assessee. Before us, Revenue has not placed any material on record to demonstrate that as to how the decisions relied upon by Ld. CIT(A) would not applicable to the present facts of the assessee. Considering the totality of the aforesaid facts, we find no reason to interfere with the order of Ld. CIT(A) and thus the grounds of the Revenue are dismissed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s a part of a highway project by an undertaking would be regarded as new infrastructure facility for the purpose of section 80IA(4). 6. On the facts and circumstances of the case and in law, the learned Commissioner of Income-tax (Appeals) erred in allowing the deduction u/s 80IA(4) on the interest income of Rs.9,60,890/- on accumulated balance of fixed deposits claimed to be derived from the business of the undertaking. 3. Before us, Ld.D.R. submitted that though assessee has submitted various grounds but the sole controversy is with respect to granting deduction u/s 80IA(4) of the Act. 4. During the course of assessment proceedings, AO noticed that during the year assessee had executed Hanumangarh Sutargarh Road Project and Ahmadnagar Ashti Jamkhed Project. AO noticed that during the year under consideration assessee had earned profit of Rs.1,02,93,746/- on Ahmadnagar Ashti-Jamkhed-Bhoom-Pardi Road Project which was awarded to it by PWD Government of Maharashtra in 2004 and the profits earned was claimed as deduction u/s 80IA(4) of the Act. He also noticed that assessee had also earned profit of Rs.63,11,301/- from Ahmadnagar Ashti Jamkhed Bhoom - Pardi Roa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It has been contended that this was a case of improving and strengthening of state highway and not merely relaying it. The appellant has also emphasized that the entire work was carried out as per the detailed specification in 2002 edition of the specification for road and bridge work of the Ministry of Surface transport, Govt. of India. The appellant has drawn attention to the order of the ITAT Pune in the appellant s own case for A.Y. 2006-07 bearing ITA No 1214/PN/2010 dated 5-4-2013 on which reliance has also been placed for the proposition that improving and strengthening of the road amounts to creating New infrastructure facility and entitle to deduction u/s 80IA(4). A copy of the said order has also been filed. 3.4 The material brought on record has been duly considered along with the submission made by the appellant. The only issue contested by the appellant in this ground of appeal relates to the disallowance of the claim of deduction u/s 80IA(4) in respect of the two road projects amounting to Rs.1,02,93,746/- and Rs.63,11,301/-. The claim of deduction has been disallowed by the AO on the plea that the specification, the nature and character of which do not match to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ourt the issue was decided in favour of the assessee and Hon'ble High Court held that the assessee incurred a huge expenditure which resulted in increasing the life of the existing dam and it was the work of the creating of new plant and the assessee was entitled for the Development Rebate. It is true that the parameters for the development rebate are different than the deduction to be claimed for developing infrastructure facilities but the principles underline the concept whether the new infrastructure mean which is never in existence at all and the said principles can be applied to the assessee s case. We find that in the case of Shristi Infrastructure Development Corporation Ltd. (supra) on the identical facts i.e. for strengthening and improving of the existing road the Tribunal held that the work is to be considered as new infrastructure facilities. 12. It is true that each case is to be examined on it s own facts. So far as the present case is concerned, we do not agree with the authorities below that it is merely work of the maintenance and repairs but in fact it is a work of bringing into existence new infrastructure facility which is in the nature of road. We, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sed. The AO has held that the interest accrued of Rs.9,60,898/- is not derived from the undertaking. However, the material brought on record do indicate that the FD was an essential part of availing the loan whereby the appellant was required to maintain Debt Service Reserve account during the currency loan account and for that purpose maintained a FD through which the said interest has accrued. In the case of Jaiprakash Power Venture Ltd Vs DCIT cited supra, of ITAT Delhi, the assessee had borrowed fund from financial institute for business purpose needs to keep certain amount as FD s, the interest income earned from such FD s netted off against the interest expenses on borrowed fund. It has been held by the ITAT that such income is to be treated as income earned from business and eligible for deduction u/s 80IA(4). Likewise in the case of Maxcare Laboratories Ltd Vs ACIT (supra) the tribunal held that interest income earned on deposits is to be treated as eligible income for the purpose of deduction u/s 80IA(4). Thus in view of the above ratio of the aforesaid decision wherein the fact of the case are similar to them, the deduction u/s 80IA(4) is liable to be allowed to the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uishing feature in the facts of the case under consideration and the facts in assessee s own case for A.Y. 2006-07 nor placed any material on record to demonstrate that the decision of Tribunal in assessee s own case for A.Y. 2006-07 has been set aside by the Higher Judicial Authorities. With respect to the interest income being eligible for deduction u/s 80IA(4), we find that Ld. CIT(A) has given a finding that the fixed deposit was an essential part for availing the loan whereby assessee was required to maintain Debt Services Reserve account and for that purpose it had to necessarily place fixed deposit and on such fixed deposits the assessee had earned interest. He therefore held it to be connected with the business of the assessee. Ld. CIT(A) thereafter relying on the various decisions cited therein has allowed the claim of the assessee. Before us, Revenue has not placed any material on record to demonstrate that as to how the decisions relied upon by Ld. CIT(A) would not applicable to the present facts of the assessee. Considering the totality of the aforesaid facts, we find no reason to interfere with the order of Ld. CIT(A) and thus the grounds of the Revenue are dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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