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TMI Blog2019 (9) TMI 375X X X X Extracts X X X X X X X X Extracts X X X X ..... 2012 (6) TMI 316 - ITAT, PUNE] Therefore, we are of considered view that the order of the Ld. CIT(Appeals) is well reasoned and therefore does not call for any interference.- Decided against revenue - ITA No.469/PUN/2017, ITA No.478/PUN/2017 - - - Dated:- 4-9-2019 - Shri R.S. Syal, VP And Shri Partha Sarathi Chaudhury, JM For the Assessee : Shri M.K. Kulkarni For the Revenue : Shri Pankaj Garg. ORDER PER PARTHA SARATHI CHAUDHURY, JM : These cross appeals preferred by the Revenue as well as assessee emanates from the order of the Ld. CIT(Appeals)-2, Kolhapur dated 06.12.2016 for the assessment year 2013-14 as per the grounds of appeal on record. 2. These cases were heard together. Since issues common, facts are similar, these cases are being disposed of vide this consolidated order. First we would take up Revenue s appeal in ITA No.469/PUN/2017 for adjudication. ITA No.469/PUN/2017 (By Revenue) A.Y.2013-14 3. The brief facts of this case are that the assessee is a domestic company engaged in the business of development ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ement with Central or State Govt., local Authority or statutory body and that the start of operation and maintenance of the infrastructure facility on or after 1st April, 1995. These contentions were even analyzed by the Hon ble Bombay High Court in the case of CIT Vs.ABG Heavy Industries Ltd Ors, (2010) 37 DTR (Bom.) 233. This was also followed by the Pune Bench of the Tribunal in the case of M/s. Laxmi Civil Engg. Services (P) Ltd. Vs. Addl. CIT, Range-2 in ITA No. 766/PN/2009, ITA No.254/PUN/2008, ITA No.431/PUN/2007 and ITA No.435/PUN/2007 for the assessment years 2006-07, 2005-06, 2003-04 and 2004-05 dated 08.06.2011. In this decision, the Tribunal has held as follows: 5. We heard both the parties and perused the orders of the revenue. The contentious issues before us are (i) whether the contractor is synonymous with the developer within the meaning of section 80IA (4)(i) of the Act; (ii) whether the condition placed in clause (c) is applicable to the case of a developer, who is not carrying on business of operating and maintaining the infrastructural facilities. In our opinion, the answer to these questions are provided by the judgment of the Bombay High ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee clearly fulfilled this condition. Before the amendment that was brought about by Parliament by Finance Act; 2001 we have already noted that the consistent line of circulars of the Board postulated the same position. The amendment made by Parliament to S.80-IA(4) of the Act, set the matter beyond any controversy by stipulating that the three conditions for development;, operation and maintenance were not intended to be cumulative in nature 6. The above judgment of the Hon'ble High court is delivered in the case of ABG Heavy Engg. Ltd (supra), who is a contractor for the JNP Trust and that contractor assessee is found to be an eligible developer for making claim of deduction u/s section 80IA (4) of the Act. From the above, it is evident that the person who only develops the infrastructure do not have the occasion to operate and maintain the infrastructure. It is further evident that the harmonious reading is necessary and mandatory in view of High Court's judgment in the case of an enterprise carrying on, business or developing which is the case of the assessee, all the conditions referred to clause (i) of section 80IA (4) should ref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y called for the details of the infrastructural projects undertaken by the appellant and recognized as income during the year. The details of the same are as under: Sr. No. Name of work Agreement with Nature of work Amount 1. BENNIWAD The Adhyaksha Gram Panchayat, Benniwad, Tal. Hukkeri Construction of Jackwell, Treatment Plant, Tanks, providing and Erection of pumping Machinery providing laying pipe line 1,10,52,246/- 2. KOGNOLI The Adhyaksha Gram Panchayat, Benniwad, Tal. Hukkeri Construction of Jackwell, Treatment Plant, Tanks, providing and Erection of pumping Machinery providing laying pipe line 43,47,646/- 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... BENWAD Laxmi Civil Engg. Services P. L. Kolhapur in respect of work of Executive Engineer, P.R.E Division, Gadag Construction of Jackwell, Treatment Plant, Tanks, providing and Erection of pumping Machinery providing laying pipe line 67,50,732/- 10. KOKATNUR Executive Engineer, P.R.E Division, Chokidi Construction of Jackwell, Treatment Plant, Tanks, 10,20,52,862/- providing and Erection of pumping Machinery providing laying pipe line 11. HALINGALI Executive Engineer, P.R.E Division, Bagalkot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rgued in his written submissions that a mere sub contractor would not be eligible Lo claima deduction u/s 80IA(4). On facts therefore it is clear that projects at sl nos 8 9 in the table above are not eligible for a deduction u/s 80IA(4). However Uteappellant qualifies to claim a deduction for the balance 11 projects undertaken during the year. I am therefore of the opinion that profits only from two projects viz Sarjapur and Bendwad being in the nature of sub contracts are not eligible for deductions u/s. 80IA(4). In this connection, the appellant submitted as under (which included a without prejudice working of profits from these 2 projects):- The assessee has executed two works i.e. Sarjapur and Bendwad for which agreement directly with any govt authority is not entered with. Rather the assessee had entered into agreement with Laxmi Civil Engineering Services Private Limited which in turn. has entered into agreement with Executive Engineer, P.R.E. Division, Gadag (for Sarjapur) and Executive Engineer, P.R.E. Division, Chikodi (for Bendwad). As such the assesee is entitled for the deduction under Section. 80-IA of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee in view of the judgment of the Hon ble Bombay High Court in the case of CIT Vs.ABG Heavy Industries Ltd Ors. (supra.) followed by the decision of Pune Bench of the Tribunal in the case of M/s. Laxmi Civil Engg. Services (P) Ltd. Vs. Addl. CIT, Range-2 (supra.). Therefore, we are of considered view that the order of the Ld. CIT(Appeals) is well reasoned and therefore does not call for any interference. 7. In the result, appeal of the Revenue in ITA No.469/PUN/2017 is dismissed. ITA No.478/PUN/2017 ( By Assessee) A.Y.2013-14 8. The assessee filed cross appeal in ITA No.478/PUN/2017 for assessment year 2013-14 against the decision of the Ld. CIT(Appeals) in not providing deduction on the two projects mentioned at Sl. No. 8 9 i.e. Sarjapur and Benwad. That once we have upheld the order of the Ld. CIT(Appeals), the cross appeal of the assessee pertaining to non granting deduction for projects at Sarjapur and Benwad becomes infractuous, hence, is liable to be dismissed. We order accordingly. 9. In the result, appeal of the assessee in ITA No.478/PUN/2017 is dismissed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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