The assessee's claim for deduction u/s 80IA(4) was denied on the ...

Infrastructure project or simple contractor? Tribunal orders fresh examination of agreements.

Case Laws     Income Tax

August 27, 2024

The assessee's claim for deduction u/s 80IA(4) was denied on the grounds that the assessee is not a developer of any infrastructure project but a simple works contractor executing civil construction work for various government and semi-government departments. The assessee argued that the nature of the agreement entered into by the appellant for the assessment year in question may differ from the previous year, and a conclusion cannot be drawn solely based on the agreement for the previous year. The Tribunal found merit in the assessee's arguments, stating that the nature of works executed by the assessee can only be ascertained by examining the agreement entered into with the principals, as the terms and conditions specified therein determine whether the assessee is a developer of an infrastructure project or a simple works contractor. Since the Assessing Officer did not examine the relevant agreements, the matter was remanded back for fresh examination to determine the assessee's claim for deduction u/s 80IA(4) based on the agreements and the nature of works executed.

View Source