Rajdeep Publicity Pvt. Ltd., Ahmednagar V. Dy. CIT, Ahmednagar Circle, Ahmednagar

ITA 864/PUN/2009

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 3113 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 4 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2010
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2006-2007
• Appeal Filed On: 22-07-2009
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: KRISHNA MURARI
• Assessee Lawyers: S U PATHAK
• Keywords: Competent authority
• Section: 80IA; 10

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI I.C. SUDHIR AND SHRI D. KARUNAKARA RAO ITA NO. 864/PN/09 (ASSTT. YEAR 2006-07) RAJDEEP PUBLICITY PVT. LTD. RAJDEEP HOUSE, SAVEDI, AHMEDNAGAR 414003 PAN NO. AABCR6660F .... APPELLANT VS. DCIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR . RESPONDENT APPELLANT BY : SHRI S.U. PATHAK & NIKHIL PATHAK RESPONDENT BY : SHRI KRISHNA MURARI ORDER PER D. KARUNAKARA RAO AM THIS IS AN APPEAL FILED BY THE ASSESSEE AGAINST TH E ORDER OF THE CIT(A)-I, PUNE DATED 04-05-2009. THE ONLY GROUND RAISED AS UNDER:- 1. THE COMMISSIONER OF INCOME TAX APPEALS-I, (PUN E) HAS ERRED IN DISALLOWING THE DEDUCTION U/S. 80-IA(4) FOR A.Y 200 6-07 RS. 99,34,780/-. 2. AT THE VERY OUTSET LD. COUNSEL FOR THE ASSESSEE FA IRLY AGREED THAT THE ISSUE IN QUESTION RELATES TO THE CLAIM OF DEDUCTION U/S. 80-I A(4) OF THE INCOME TAX ACT INVOLVING DEDUCTION AMOUNTING TO RS. 99,34,780/- AN D THE SAME IS COVERED AGAINST HIM AND IN FAVOUR OF THE REVENUE BY THE ORDER OF THE T RIBUNAL IN THE ASSESSEES OWN CASE FOR THE A.Y 2003-04 TO 2005-06 VIDE ITA NO. 17 82,1783/PN/07 & 1414/PN/08. WE HAVE PERUSED THE SAID ORDER OF THE TRIBUNAL AND FIND THAT THE ISSUE IS IDENTICAL AND THE SAME IS COVERED AGAINST THE ASSESSEE VIDE PA RA 3 TO 5 OF THE SAID ORDER. 3. AS REGARDS THE SUBMISSION OF ASSESSEE THAT CIRCULAR NO.10/2005 DT. 16.12.2005 STATE THAT FOR THE PURPOSE OF SECTION 10 (23G) AND SECTION 80 IA, STRUCTURE INCLUDES STRUCTURES AT THE PORTS FOR STORA GE, LOADING, UNLOADING ETC. AND ONLY STIPULATION PUT BY THIS CIRCULAR IS THAT THE CONCERNE D AUTHORITY SHOULD ISSUE CERTIFICATE THAT THE SAID STRUCTURES FORM A PART OF T HE PORT AND THAT SUCH STRUCTURES ARE BUILT ON BOT OR BOLT SCHEME AND THERE IS AN AGREE MENT THAT THE SAME SHOULD ITA NOS. 864/PN/09 A.Y. 2006-07 PAGE 2 OF 3 BE TRANSFERRED TO THE SAID AUTHORITY ON THE EXPIRY OF THE TIME STIPULATED IN THE AGREEMENT. THE C.B.D.T BEING THE COMPETENT AUTHORITY FOR THE PURPOSE OF DELEGATION OF LEGISLATION AS LAW MAKING POWER OF C.B.D.T IS UNDERSTOOD, THE AMBIT OF CIRCULAR SHOULD NOT BE ENLARGED TO INCLUDE THE ACTIVITY INTO WHICH THE ASSESSEE IS ENGAGED. THERE CANNOT BE ANY IMPLIED ENLARGEMENT OF SUB -SECTION. THE STAND OF THE ASSESSEE THAT STRUCTURES OF FOOT OVER BRIDGE AND RO AD SIGNALS ARE NECESSARY TO DEVELOP INFRASTRUCTURAL FACILITY WHICH IS ROAD, LACK MERIT FO R SIMPLE REASONS THAT ROAD ON WHICH SIGNALS HAVE BEEN PUT WAS EXISTING BEFORE SIGNA LS WERE PUT. IN THIS BACKGROUND, IT WAS RIGHTLY OBSERVED THAT ROAD SIGNALS CO ULD NOT BE SAID TO BE AN INTEGRAL AND IN-SEPARABLE PART OF THE ROAD. THEY CAN MAKE THE USE OF ROAD MORE CONVENIENT BUT IT CANNOT BE SAID THAT WITHOUT THE SIGNALS , THE ROAD CANNOT BE USED. 4. AS REGARDS THE SUBMISSION OF ASSESSEE THAT SECTION 80IA USES THE WORD DEVELOPING AS AGAINST SEC 80 IB(10) WHICH USES THE T ERM THE DEVELOPMENT AND CONSTRUCTION AND THEREFORE, FOR CLAIM OF DEDUCTION U/S. 80IA(4), THERE MAY BE DEVELOPMENT OF INFRASTRUCTURE WITHOUT ITS CONSTRUCTION. IT WAS RIGHTLY FOUND MISPLACED TO THE FACTS IN THE CASE OF THE ASSESSEE. AS PER THE PROVISIONS OF SUB SECTION (1) TO SECTION 80 IA, WHERE GROSS TOTAL INCOM E OF ASSESSEE INCLUDE ANY PROFIT AND GAIN DERIVED BY AN UNDERTAKING OR AN ENTERPRISE FR OM ANY BUSINESS REFERRED TO SUB-SECTION (4), AND DEDUCTION OF AN AMOUNT EQUAL TO 1 00% OF PROFIT AND GAIN DERIVED BY THE ASSESSEE SHALL BE AVAILABLE FOR 10 CONSECU TIVE YEARS. ACCORDING TO THE PROVISION OF SECTION 80IA (4), IT APPLY TO ANY ENTERPRISE CARRYING ON BUSINESS OF (I) DEVELOPING OR (II) OPERATING OR MAINTAINING OF, (III)DEVELOPING, OPERATING AND MAINTAINING ANY INFRASTRUCTUR AL FACILITIES. THE EXPLANATION TO SECTION 80IA (4) EXHAUSTIVELY DEFIN ES INFRASTRUCTURAL FACILITY IN ITS CLAUSE (A) AS ROAD INCLUDING TOLL ROAD, BRIDGE OR A RA IL SYSTEM. THE ASSESSEE HAS CONSTRUCTED TWO FOOT OVER BRIDGES AND ROAD SIGNALS. MO ST OF THE INCOME OF THE ASSESSEE IS ON ACCOUNT OF PUTTING ROAD SIGNALS. IT DOE S NOT FIT INTO DEVELOPMENT OF INFRASTRUCTURAL FACILITIES AS DEFINED IN EXPLANATION TO SECT ION 80 IA(4). SO, THERE CANNOT BE ANY DEVELOPMENT OF ANY ROAD WITHOUT ITS CON STRUCTION. ADDING ADDITIONAL FACILITY CANNOT BE SAID THAT AN INFRASTRUCTURAL FACILITY IN T HE NATURE OF ROAD AS DEFINED IN EXPLANATION TO SECTION 80IA(4). 5. IN VIEW OF THE ABOVE, WE HOLD THAT THE ASSESSEE D ID NOT DEVELOP ANY INFRASTRUCTURAL FACILITY IN THE NATURE OF ROAD AS DEFINED IN EXPLANATION TO SUB-SECTION (4) TO 80 IA OF INCOME TAX AND THEREFORE, THE ACTION OF THE A.O DENYING THE DEDUCTION TO ASSESSEE UNDER 80 IA NEED NO INTERFERENC E FROM OUR SIDE. WE UPHOLD THE SAME. SIMILAR ISSUE AROSE IN A.Y. 2004-05 AND 2005-06. FA CTS BEING SIMILAR AND FOLLOWING THE SAME REASONINGS, THE REJE CTION OF CLAIM U/S. 80IA(4) NEED NO INTERFERENCE FROM OUR SIDE. 3. IN VIEW OF THE ABOVE COVERED NATURE OF THE ISSUE, WE ARE OF THE OPINION THAT THE ORDER OF THE CIT(A) DOES NOT CALL FOR ANY INTERFEREN CE. 4. IN THE RESULT, APPEAL FILED BY THE ASSESSEE IS DISMISSED. ORDERS PRONOUNCED IN THE OPEN COURT ON 30 TH NOVEMBER, 2010. SD/- SD/- (I.C. SUDHIR) (D.KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBE R PUNE DATED THE 30 TH NOVEMBER, 2010 R ITA NOS. 864/PN/09 A.Y. 2006-07 PAGE 3 OF 3 COPY OF THE ORDER IS FORWARDED TO : 1. ASSESSEE 2. DCIT, AHMEDNAGAR CIRCLE, AHMEDNAGAR 3. CIT(A)-I, PUNE 4. CIT-I, PUNE 5. D.R. ITAT B BENCH BY ORDER ASSISTANT REGISTRAR I.T.A.T PUNE