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TMI Blog2012 (10) TMI 713X X X X Extracts X X X X X X X X Extracts X X X X ..... n under Section 80IC of the Income-tax Act, 1961. 3. At the time of hearing before us, it is stated by the learned counsel that the Assessing Officer disallowed the deduction under Section 80IC on the ground that the assessee's hotel is not environment friendly and does not qualify for deduction under Section 80IC. That, on appeal, the learned CIT(A) took the view that the assessee has fulfilled the requirement of promoting eco-tourism but, he sustained the disallowance on the ground that the assessee has not started the new hotel during the year under consideration but, it only made substantial expansion. It is submitted by the learned counsel that this issue is also covered in favour of the assessee by the decision of ITAT in the case of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of clause (b) of sub-section (2) of section 80- IC is not entitled to claim the deduction specified u/s 80-IC. To sum up, the disallowance made by the AO on the ground that the hotel does not fulfill the requirements of promoting Eco-tourism etc. is not based on the correct understanding of what Eco-tourism including hotels connotes and the same has now been decided by the Hon'ble ITAT Delhi Bench in Shri Bidhi Chand Singhal vs. ITO in ITA No.3419/Del/2009 which is respectfully followed and the deduction would have certainly been directed to be allowed had the hotel been established or had it commenced its operations beginning from the previous year relevant to A.Y. 2004-05 and undertaken substantial expansion between 07.01.03 and 31.03.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ences the operation within the period mentioned in the statute. It is also admissible if the hotel commences any operation and undertakes substantial expansion during the period mentioned in the statute. It does appear to us that the words "commences any operation" are rather redundant for the reason that the deduction in such a case is admissible on the basis of language earlier employed in this provision. Therefore, in the case of an existing hotel, the deduction will be admissible if the substantial expansion takes place within the prescribed period. The interpretation sought to be placed by the ld.DR on this provision will lead to a situation where the deduction under the second part of the provision would be admissible only if commence ..... X X X X Extracts X X X X X X X X Extracts X X X X
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