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TMI Blog2021 (1) TMI 1073X X X X Extracts X X X X X X X X Extracts X X X X ..... of law contained under the SEZ 2005. Section 51 of the SEZ Act 2005 provides that the SEZ Act shall have overriding effect notwithstanding anything inconsistent therewith contained in any other law for the time being in force or in any instrument having effect by virtue of any law other than this Act. In our considered opinion developing SEZ by itself is the business contemplated u/s. 80 IAB of the Act and the SEZ itself provides that the lease rental income generated in the hands of a developer engaged in setting up of the SEZ, is the profits and gains derived from the business of developing a SEZ. - Decided against revenue. - ITA No.4965/DEL/2016 (Assessment Year: 2012-13) - - - Dated:- 25-1-2021 - SH. N. K. BILLAIYA, ACCOUNTANT MEMBE ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The main contention of the assessee was that it is engaged in the eligible business of developing SEZ and the income arising to the assessee is from such eligible business. The assessee strongly contended that the relevant factor is profit and gain should be derived from the eligible business irrespective of the head of the income. 9. The claim of the assessee was considered by the AO but did not find any favour because the AO was of the firm belief that deduction u/s. 80IAB of the Act is available only from the profits and gains derived by an undertaking from any business and since income from house property does not qualify for deduction u/s.80 IAB of the Act, the claim was denied. 10. Assessee carried the matter before the CIT(A) a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... this Act. In our considered opinion developing SEZ by itself is the business contemplated u/s. 80 IAB of the Act and the SEZ itself provides that the lease rental income generated in the hands of a developer engaged in setting up of the SEZ, is the profits and gains derived from the business of developing a SEZ. 14. The coordinate Bench of ITAT Chennai in the case of Coimbatore Hitech Infrastructure (P) Ltd. Vs. Addl. CIT, Range-4, Coimbatore in IT Appeal No.937 (MDs) of 2012 has held as under :- the assessee company is a company engaged in the business of developing sector specific SEZ for information Technology and Information Technology Enabled Services at Coimbatore. There is no dispute regarding the character of the business ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder :- The assessee claims that irrespective of the head of income, the (house property) lease rental income shall continue to be eligible for deduction under section 80-IAB. The said section, in its relevant part, reads as tinder: Deductions in respect of profits and gains by an undertaking or enterprise engaged in development of Special Economic Zone. 80-IAB. (1) Where the gross total income of an assessee, being a Developer, includes any profits and gains derived by an undertaking or an enterprise from any business of developing a Special Economic Zone, notified on or after the 1st day of April, 2005 under the Special Economic Zones Act, 2005, there shall, in accordance with and subject to tile provisions of this section, b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere it is carried in an organized manner. i.e., as a business, as in the present case. It shall, however, not cease, for that reason, to be profits and gains derived from the activity of developing a SEZ. The word business - even otherwise a word of wide and indefinite import, as occurring in section 80-IAB(1), is to be, accordingly, construed in a broad rather than a strict sense, as conveying the gamut of activities, including activities subservient and incidental to developing a SEZ and turning it into account. Now, surely, leasing of house property, inasmuch as the lessees (who are to be, or presumably so, in info-tech business) would be able to undertake their businesses only on the developed property being made available to them, co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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