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TMI Blog2017 (12) TMI 1204X X X X Extracts X X X X X X X X Extracts X X X X ..... vision for railway system we find clauses in the agreement are exactly identical to the agreement entered into by M/s.Ultratech Cements Limited for the railway siding in its premises. On analyzing the agreement and clauses thereon and the provisions of the Act it has been held by the Coordinate Bench in the case of M/s.Ultratech Cements Limited (2017 (12) TMI 1134 - ITAT MUMBAI) that the Railway System operated by the assessee is an infrastructure facility and entitled for the deduction u/s. 80IA of the Act. Section 80-lA was an instrument of legislative policy, conceived with a view to provide an impetus to private sector participation in infrastructural projects. We also find from the letter dated 04.03.2014 submitted to the Assessing Officer it was clearly stated that this facility is being operated and maintained by the assessee company. Therefore, it can be said that the assessee is operating and maintaining the infrastructure facility in the form of water supply project. Therefore, applying the same principles as was held in the case of Railway system we hold that the Water Supply Project operated and maintained by the assessee is an infrastructural facility and is eligibl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The claim of assessee for deduction u/s 80IA in respect of various undertakings was examined by calling various details/ documents, explanations regarding eligibility and quantum of deduction. For AY 2008-09 to AY 2011-12 the cases were referred to TPO for examination of various international transactions entered by assessee and for that reason additional period of one year was availed by the AO for investigation/enquiries and completion of assessments. The assessments in the case of assessee for AY 2008-09 to AY 2011-12 were completed u/s.153A r.w.s. 143(3) 144C of the Act on 31.05.2014 by the LD. DCIT CC-44, Mumbai. The aforesaid assessment orders have been passed with the prior approval of Ld.Addl.CIT Central Range-10, Mumbai u/s.153D of Income Tax Act, 1961. 6. Subsequently Ld. Principal Commissioner of Income Tax (PCIT) issued Show cause notice U/s 263 of Income Tax Act, 1961 (the Act) dated 19.01.2016, wherein he pointed out that Assessing Officer has not verified claim of deduction U/s 80IA on account of income from Railway Siding, Water project and captive power consumption and committed an error in passing the Assessment Orders. 7. The assessee in response to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of deduction u/s.80IA(4)of the Act thoroughly and after obtaining all the details from the assessee company, denied this deduction in respect of Certified Emission Reduction (CER) and allowed the said deduction in respect of CPP(Captive Power Plant), Rail System and Water Supply Treatment Plant. Therefore, he submitted that this case falls in the category of those cases, where the Ld. AO has made requisite enquiries, applied its mind and allowed the deduction u/s.80IA(4)of the Act partly in accordance with provisions of Act and settled legal position. He submits that in all such cases, where Ld. AO has obtained details and applied his mind, assessments have attained finality they cannot be subject matter of proceedings u/s.263 of the Act merely on the ground that there is another view possible and any further enquiry could be made. He relies on the following case laws to support the contention: (i) CIT vs. Fine Jewellery (I) Ltd. (2015) 372 ITR 303 (Bom) (ii) Malabar Industrial Co. Ltd. vs. CIT (2000) 243 ITR 83 (SC) (iii) CIT vs. Ashish Rajpal (2010) 320 ITR 674 (Delhi) (iv) CIT vs. Sunbeam Auto Ltd. (2011) 332 ITR 167 (Delhi) (v) CIT vs. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allocation of operating and maintenance expenses, depreciation, electricity consumption per ton of steel etc. (ii) Rail System viz clarification regarding charges leviable for railway siding, deprecation, details of outward and inward movement of goods. Assessee also submitted Railway Board circular dated 10.05.2006, to show the basis on which the profitability of Rail System has been computed. (e) During the hearing on 1.3.2014, the Ld AO raised queries with regards to each undertaking as follows: (i) Power Undertaking: Party wise details of external sates and rate charged, basis of working of rate for inter unit sale, certificates of CER, basis of allocation of various expenses and depreciation etc. (ii) Rail System: Depreciation, explanation regarding comparative instance for revenue recognition, note on actual functioning of the unit, allocation of expenses etc. (iii) Water Infrastructure System: Depreciation, note on actual functioning of unit, allocation of expenses, details of secured loans etc. (f) In response to above queries, the Assessee submitted specific details alongwith supporting evidences regarding the Captive power plants, rail system and water ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the administration and if required by the railway administration under its supervision maintains in good order and repair the said portion of the siding. Such charges as may be fixed by the railway for the supervision rendered shall be paid by the applicant. 14. Therefore, Learned Counsel for the assessee submitted that, it is very clear from the above clause that the assessee is bearing the expenses of maintenance of the sidings. Even otherwise he submits that the Hon'ble Bombay High Court in case of CIT v. ABG Heavy Industries Limited 322 ITR 323(Bom) has held that: - Deduction under section 80-IA is available to an enterprise which (I) develops; or (ii) operates and maintains; or (iii) develops, maintains and operates that infrastructure facility inasmuch as subsequent amendment to section 80-IA(4) has made it clear that three conditions of development, operation and maintenance were not intended to be cumulative in nature. Referring to above decision of Hon'ble Bombay High Court he submits that, it is very clearly held that deduction is available to assessee who fulfills any one or more activity of any infrastructure facility. Hence this proposition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Act does not use the word private or public facility but used the word infrastructure facility. He submits that even the alleged communication from CCM South Western Railway dated 24.09.2014 does not deny the fact that railway siding is an infrastructure facility and Learned CIT(A) has not quoted any part of section 80IA of the Act to substantiate his opinion. 18. He further submits that the, second observation of the Ld. CIT(A) in the case of Ultratech Cement is that assessee did not have any agreement as mentioned in the clause (i)(b) of sub section 80IA(4) of the Act for developing, operating and maintaining any Rail System is also not correct. He submits that the requirement of law is agreement between assessee and a Government Authority for (i) developing or (ii) operating and maintaining or (iii) developing, operating and maintaining a new infrastructure facility. Referring to CBDT circular No.10/2014 dated 06.05.2014 counsel submits that CBDT has also clarified that deduction u/s.80IA(4) is available to an Enterprise carrying on the business of developing or operating and maintaining or developing, operating and maintaining infrastructure facilities. He submits tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to note that agreement entered by the assessee company with Southern Western Railway is identical to that of Ultratech Cement Ltd. Copy of agreement is placed at Page Nos.74 to 91 of the Paper book. Therefore he submits that, since the facts are identical and Ld PCIT has disallowed the deduction U/s 80IA(4) of the Act on the basis of order passed in case of Ultratech Cement Ltd., and in view of the decision of Tribunal in Ultratech Cement allowing the claim for deduction u/s. 80IA on Railway sidings, the said action of the Ld PCIT u/s.263 does not survive. Therefore, he submits that considering the facts of the case and decision of coordinating Bench on the similar issue deduction U/s 80IA(4) claimed on Railway Sidings, disallowed by the Ld PCIT is not sustainable. 22. As regards the claim for the said deduction on Water Supply Treatment Plant, Learned Counsel for the assessee submits that, the Ld.PCIT has disallowed deduction U/s 80IA(4) on the plea that the assessee has developed a water supply system for private use and not for public utility. Learned Counsel for the assessee submits that Ld. PCIT relied upon the assessment order of the assessee for AY 2012-13 wherein AO h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Govt. should enter stands explained in the light of Bombay High Court Judgement in case of ABC Heavy Ind. Ltd (Supra). In its judgement, the Their Lordships have mentioned as under: The object of section 80-IA was to provide an impetus to the growth of infrastructure in the nation. A sound infrastructure is a sine qua non for economic development. Absence of infrastructure poses significant barriers to growth and development. A model which relied exclusively on the provision of basic infrastructure by the State was found to be deficient. Section 80-lA was an instrument of legislative policy, conceived with a view to provide an impetus to private sector participation in infrastructural projects. Consistent with the legislative object of encouraging private sector participation in the development of infrastructure, section 80-IA was enacted. 25. He further submits that, it is also matter of record that this facility is being operated and maintained by the assessee company, as can be seen from the letter dated 04.03.2014, submitted to the assessing officer. He submits that the very fact that it has been developed infrastructure facility for its own use does not bar the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ully claimed the said deduction U/s 80IA on account of Railway System and water supply system. The said claim was duty examined by the AO during the course of assessment and the order was passed with prior approval of Additional CIT U/s 153D of the Act. Therefore, assuming jurisdiction U/s 263 by the Ld PCIT is not in consonance of law and needs to be rejected. 30. Without prejudice to above, Learned Counsel for the assessee submitted that for AY 2009-10, the assessed gross total income as per order dated 30.5.2014 passed u/s 153A rws 143(3) 144C has been assessed at a loss of ₹ 179,40,16,135/-. As there being no positive gross total income for the relevant assessment year, no deduction under chapter VIA has been allowed at all by the Ld AO. As there is no allowance of any deduction u/s 80IA in the relevant assessment year for Rail System, Water Supply System and Captive Power Plants, the order for whatever reason, cannot be considered as erroneous and prejudicial to the interest of revenue for invoking jurisdiction u/s 263 in so far as reasons quoted in the show cause notice are concerned. Learned Counsel for the assessee therefore submits that in view of the above disc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... system. We also find that the Ld.PCIT did not provide the information to the assessee which was gathered from the Railway Department to rebut the information gathered from the Department. Apparently principle of natural justice has not been adhered to. We also find that the Assessing Officer called for various details in the course of Assessment Proceedings. Assessee has furnished various details as has referred to in the above paras including the order of the ITAT in the case of M/s.Ultratech Cements Limited for the Assessment Years 2004-05 2005-06 in ITA.No. 7735 7736/Mum/2007 dated 20.08.20009 where the similar claim was allowed i.e. deduction u/s. 80IA in respect of Railway siding was allowed and the Revenue even took up the matter before the Hon'ble Bombay High Court and the Hon'ble Bombay High Court by order dated 02.04.2014 in ITR 6070 of 2010 refused to answer the question of law. The assessee furnished this copy to the Assessing Officer in the course of Assessment Proceedings and the Assessing Officer after examining the details furnished by the assessee as well as the order of the ITAT in the case of M/s.Ultratech Cements Limited (supra) for the Assessment Ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d are being mentioned hereunder: i. CIT v. Max India Limited [2007] 295 ITR 282 (SC) ii. Malbar Industries Co Ltd v. C1T [2000] 243 ITR 83 (SC) iii. Grasim Ind. Ltd. vs. C1T (HC, Bom.) (1TA No.113/1990) (Order dt. 01.02.10) CIT vs. Bank of Maharashtra (HC, Bom.) (ITA No.2027 2102/2013) (Order dt. 07.12.15) 36. In view of the above mentioned fact and circumstance of the case as well as the case laws cited above, it may be seen that the assessee company had claimed the deduction u/s. 80IA(4) of the Act in accordance of the provisions of the Act and the assessing officer has rightly allowed the same after making elaborate enquiry regarding the eligibility of assessee's claim, before specifically denying this deduction in respect of CER and allowing the same in respect of CPP, Water Supply and Treatment Plant and Rail System. The order of the Assessing Officer may not have dealt specifically on all these issues in the assessment order but that by itself is not sufficient reason to hold that the assessment order is erroneous and prejudicial to the interest of revenue. It is for the Ld.PCIT to point out as to what error was committed by the Ld. AO in taking a particular v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Railway Authorities was not under the BOLT Scheme but infact the assessee was permitted to setup and even operate and maintain the rail system so developed in accordance with terms and conditions of the agreements under the supervision and as per guidelines of Indian Railways. Prior to putting up the rail systems, the assessee used to transfer the material from its plant to the nearest Indian Railways station and vice versa through Road and used to incur road freight and loading unloading charges at multiple stages. To save these costs and other incidental costs, the assessee decided to develop the rail infrastructure from its manufacturing setup till the nearest Indian Railway station. It is Indian Railways who either have the power to develop any railways in India or it can enter into any arrangement with any person for developing and for operating rail systems subject to prior approvals and conditions. Therefore, the assessee accordingly entered into agreement with the Rail authorities to develop, operate and maintain its rail systems. The agreement lays down various conditions to be complied with, before and during the development, maintaining and operating the rail systems. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y arrangement with any person for developing and for operating rail systems subject to prior approvals and conditions of the Indian Railways. M/s L T has accordingly entered into agreement with the appropriate rail authorities to Develop, Operate and Maintain its rail systems. M/s. L T had awarded contract to the private parties for construction of rail sidings (including upto the nearest rail head) under the supervision of Indian Railways approved agency, and the entire cost for construction / development paid to the aforesaid agency and supervision charges paid to Indian Railways approved agency have been borne by the assessee, apart from all costs incurred for all the materials and incidental expenses. It was further explained in terms of clause 14, Wagons are hauled by the Railway Administration from the point marked 'X' or such other points as may be fixed upon by mutual consent of the applicants and railway administration in such manner as shall be determined in each case by the Railway administration. The assessee undertakes to shunt the wagons from such point to his premises and back with his own labour. However , no siding charges are charged by Indian Railways, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or be caused by reasons of negligence or non-observance of such rules, regulations and orders. e) Clause No. 8(b) - Wherein it is mentioned that, Maintenance and other Charges for the portion of the sidings - The applicant will at their own cost and expenses in all things and to the satisfaction of the railway administration and if required by the railway administration under its supervision maintains in good order and repair the said portion of the siding. Such charges as may be fixed by the railway for the supervision rendered shall be paid by the applicant. 39. These are other various clauses wherein it is evident that the Development, Operation and Maintenance is done by the assessee and the entire cost for the same is borne by the assessee. 40. From the record we also found that the assessee has duly submitted for all the rail systems, Form 10CCB, duly certified and audited by M/s. G.P Kapadia Co., Chartered Accountants along with Balance Sheet, P L account, Schedules forming part of Balance sheet and P L Account. 41. However, the AO did not agree with assessee s contention and held that Rail systems developed by assessee is not eligible for claim of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dipatri, Arakkonam and Durgapur are placed on record and we have carefully perused the relevant terms and conditions. The Indian Railways plays role in operations and maintenance of the Rail systems, traffic Management, etc. as mentioned under the various clauses of the Agreements entered into, and the entire cost of such operation and maintenance is borne by the assessee including for the Railway staff being deputed for the purpose. 44. From the record we found that M/s. L T had entered into agreements with the Railway authorities to develop, Operate and Maintain the Rail systems which infact the company has done from initial day. This agreement with the Railway Authorities was not under the BOLT Scheme but infact the assessee was permitted to setup and even operate and maintain the rail system so developed in accordance with terms and conditions of the agreements under the supervision and as per guidelines of Indian Railways. As per the relevant provisions of law during relevant period there is no requirement for Rail Infrastructure to be In BOLT scheme, to be eligible for claiming deduction under Section SO-lA (4 )(i). Section 80-lA (4 )(i) provides the following condition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incurred for all the materials and incidental expenses. 49. From the record we found that the rail systems were developed under the agreements entered into with Indian Railways and assessee operates and maintains the same in accordance with terms and conditions of the Agreements, under the supervision and as per guidelines of Indian Railways. We have carefully gone through the relevant clauses of the agreements substantiating the same which reads as under: a) Clause No. 2, Agreement to Construct Siding - Wherein it is mentioned that the Railway administration will at the cost and the expenses of the applicant, in all respect, construct the railway sidings Further kindly be informed that, for construction of the siding under the supervision of the Railways, the contract for construction and supervision has been awarded by the applicant and the entire cost has been borne by the applicant. b) Clause no. 6 - Payment by Applicant against the total estimated cost wherein it is mentioned that, The applicant will pay in advance to the railway administration the total estimated cost of the work consisting of the estimated costs of work done by the party and those by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the railway administration and if required by the railway administration under its supervision maintains in good order and repair the said portion of the siding. Such charges as may be fixed by the railway for the supervision rendered shall be paid by the applicant. There are other various clauses wherein it is evident that the Development, Operation and Maintenance is done by the appellant and the entire cost for the same is borne by the appellant. 50. The question of allowability of the deduction u/s. 80IA in respect of rail systems has been settled in earlier years by the Hon'ble ITAT in assessee s own case. The facts and the agreements were also placed before authorities in those years. Therefore, the claim based on same facts needs to be allowed following the principle of Consistency in assessment proceedings. Even though the 'principles of res judicata' do not apply to income tax proceedings and each assessment year being a separate unit, what is decided in one year may not apply in the following year but where a fundamental aspect permeating through the different assessment years has been found as a fact one way or the other and parties have allow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sidered view, even assuming that the requirement of public facility is to be fulfilled, it is worth noting that a section of public is also considered to be public. This principle has been laid down by the Hon'ble Supreme Court in the context of a Chamber of Commerce [CIT vs. Andhra Chamber of Commerce (1965)] (55 ITR 722) wherein it was ruled that even though the Andhra Chamber of Commerce was established only to serve the traders and businessmen in the State of Andhra Pradesh, such traders and businessmen constituted a section of public and therefore the Chamber existed for a public charitable purpose. In the ultimate analysis of the facts in the case of assessee Company, the benefits of such siding does ensure to the public in general - to the consumers of cement. Any benefit to the business even though it is first enjoyed by the particular trade or establishment eventually is for the general public good. It has to be noted that several industries may come up on both the sides of sidings from the interchange point till factory gate, if anyone of them wants to make use of railway sidings, it is permissible for the Railway Administration to entertain such request and by making ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the Indian Railways with whom the assessee has entered into an agreement, is the statutory body designated under the Indian Railways Act. We found that the agreement does not merely contain the terms and conditions of the construction of railway siding i.e. development of siding (laying of tracks, signal system and all the essential components of Rail Systems) but it also contains the terms and conditions relating to its operation and maintenance as well. 60. Our attention was also invited to letter No. 99/TC(FM)26/1/Pt-II (Sub Liberalisation of siding 'Rules) of the Railway Boar clarifying that the capital cost of new siding, maintenance cost, cost of Railway staff etc. will be borne by the enterprise only, which also supports our view. 61. As far as operations is concerned, we found that the assessee carries out all the following operations for smooth movement of its goods, viz. shunting of the wagons, placing of the wagons at appropriate locations, loading/unloading of wagons within the stipulated time and stipulated methods of Indian Railways through Wagon Loading Machines and Wagon Tipplers, weighing of wagons on Motion Weigh Bridges, wagon couplings and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an Railways and not by the assessee Company. 69. We found that the CIT(A) has equated running of goods train with the operation of Rail System . This is the sole basis on which he has arrived at his conclusion that since the assessee is not running the goods train it is not operation of Rail System and hence not eligible for claiming deduction under section 80IA(4). 70. As per our considered view, the operation of Rail System is not simply running of goods train. Operation of Railway Systems comprises of various activities viz. shunting of the wagons, placing of the wagons at appropriate locations, loading/unloading of wagons within the stipulated time and stipulated methods of Indian Railways through Wagon Loading Machines and Wagon Tipplers, weighing of wagons on Motion Weigh Bridges, wagon couplings and de-couplings, rake formation for dispatch, hauling of wagons through its own locomotives within the factory premises, etc. Thus, the rail system is being operated by the assessee and the cost of above operations is borne by assessee. 71. With regard to allegation of the CIT(A) that the assessee has never claimed that it is hauling the wagons on the entire sid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating one of the component of its revenue . 80. . 81. . 82. . 83. The CIT(A) has also raised a query as to whether the L T Ltd, which had developed said rail system was eligible for deduction u/s 80lA in respect of profit, if any, otherwise on operation maintaining that system under the provisions that existed at the relevant time [prior to 01.04.2002] when such infrastructure facility is said to have become operational. As per our considered view one of condition for claiming deduction under the pre-amended section 80IA(4) (i.e. prior to AY 2002-03) stipulated that the assessee should enter into an agreement with the Government (Central or State) or other authorities mentioned therein for (i) developing, (ii) maintaining and operating or (iii) developing, maintaining and operating a new infrastructure facility. Further, the agreement should also provide for transfer of such infrastructure facility to such authorities within the period stipulated in the agreement. The Central Government realizing the need to encourage investment particularly in the area of surface transport, water supply, water treatment system, irrigation project, sanitation and sewe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conditions as prescribed u/s 80IA(4) as it stood during AY 2004-05, viz: a) It is owned by a company registered in India. b) It has entered into an agreement with the Government for developing / operating / maintaining the infrastructure facility, and c) It has started operating and maintaining the infrastructure facility on or after April,1995. 87. Thus, under the amended conditions of the section 80-IA(4) i.e. post AY 2002-03, L T as well as UTCL were eligible for claiming deduction u/s 801A. As per section 80IA(2), the deduction is available at the option of the assessee, for any ten consecutive assessment years out of twenty years beginning from the year in which the undertaking or enterprise develop and operate any infrastructure facility. The assessee has started claiming deduction post AY 2004-05 and is within the period of available twenty years. Under section 80IB, u/s 80lC, 80ID and 80lE, the first year in which the production is started is taken as initial previous year whereas, after the amendment in provisions of section 80lA w.e.f. 01.04.2000 the initial assessment year is at the option of the assessee to avail the benefit. 88. In view o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the assessee's claim under section 80-1A. On Revenues appeal, the ITAT held that for claiming deduction under section 80-IA, it has to be determined at end of relevant previous year that as to whether assessee is registered as SSI and there is no condition in Act that an industrial undertaking should fulfill all conditions as laid down under section 80-IA in very initial year itself and not thereafter. 90. Even as per fiction created by section 80IA(5), the eligible business is the only source of income and the deduction would be allowed from the initial assessment year or any subsequent assessment year. It nowhere defines as to what is the initial assessment year . Prior to 1-4-2000, section 80IA(12) defined the initial assessment year for various types of eligible assessees. However, after the amendment by the Finance Act, 1999, the definition of initial assessment year has been specifically taken away. Now, when the assessee exercises the option of choosing the initial assessment year as culled out in section 80IA(2) from which it chooses its' 10 years of deduction out of 20 years, then only deduction u/s 80lA can be determined. 91. ITAT Chennai Bench ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iming deduction for Rail system u/s. 80-IA from Assessment year 2004-05 onwards as it satisfied all the conditions as prescribed u/s 80IA(4). Section 80IA(12) provided that in the scheme of amalgamation or merger, the deduction is available to the amalgamated / resulting company. The relevant provision of sec. 80IA(12) reproduced hereunder:- Where any undertaking of an Indian company which is entitled to the deduction under this section is transferred, before the expiry of the period specified in this section, to another Indian company in a scheme of amalgamation or demerger. (a) no deduction shall be admissible under this section to the amalgamating or the demerged company for the previous year in which the amalgamation or the demerger takes place; and (b) the provisions of this section shall, as far as may be, apply to the amalgamated or the resulting company as they would have applied to the amalgamating or the demerged company if the amalgamation or demerger had not taken place. 95. Section 80IA(2) further provides that the deduction is available at the option of the assessee for any ten consecutive assessment years out of twenty years beginning from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on this point is whether the respondent assessee is eligible for deduction u/s. 80IA of the Income Tax Act by urging that the Rail system is not a profit Centre but a cost saving Exercise undertaken in terms of subsection (4) of section 80IA?......... 40. Thus as regards the very claim for the deduction u/s. 80IA of the Act Per se, the ITAT order can be treated as final in favour of the assessee as the Hon'ble High Court refused to admit the question raised by the Revenue on the very applicability of the provisions of section 80IA of the Act for the Rail System. Therefore, respectively following the said decision we hold that the assessee entitled for the deduction u/s. 80IA of the Act in respect of the railway system. 41. Similarly, in the case of water supply system assessee entered into agreement dated 01.06.2006 with the Government of Karnataka for laying and operating water supply system from Tungbhadra dam located at Hospet to its factory located at Sandur Taluk, Bellary, Karnataka which is around 42 km this goes to show that apparently Government of Karnataka has allowed the assessee company to lay the water pipe line and draw water from Tungabhadra dam. Permis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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