13 Industrial undertaking – Deduction u/s. 80-IA can be claimed in return filed pursuant to notice u/s. 153A – Finding that assessee developer and not contractor – Assessee is eligible for deduction u/s. 80-IA(4)(i)

Princ. CIT vs. Vijay Infrastructure Ltd; 402
ITR 363 (All); Date of Order: 12/07/2017:

A.
Y. 2009-10:

Sections
80-IA and 153A

The
assessee was a developer eligible for deduction u/s. 80-IA(4)(i) of the
Income-tax Act, 1961. For the A. Y. 2009-10, the assessee claimed deduction
u/s. 80-IA in the return of income filed pursuant to notice u/s. 153A of the
Act. The Assessing Officer held that the assessee was a contractor and hence
was not eligible for deduction u/s. 80-IA(4)(i) of the Act.

The
Commissioner (Appeals) found that the assessee fulfilled all the criteria of a
developer in accordance with section 80-IA(4)(i) and by his works a new
infrastructure facility in the nature of road had come into existence and the
assessee was eligible for tax benefit u/s. 80-IA(4)(i) of the Act. The Tribunal
confirmed this. On the question whether the assessee is entitled to deduction
u/s. 80-IA(4)(i) when the claim is made in the return of income filed pursuant
to notice u/s. 153A of the Act, the Tribunal held that for the A. Y. 2009-10
and onwards, the time for filing revised return had not expired and therefore,
claim for deduction u/s. 80-IA if not made earlier could have been made in the
revised return. Once it could have been claimed in the revised return u/s.
139(1), it could have also been claimed u/s. 153A of the Act.

In appeal
by the Revenue, the following questions were raised before the Allahabad High
Court:

“i)   Whether the Income-tax Appellate Tribunal was
justified in allowing the deduction u/s. 80-IA to the assessee on the basis of
a return filed after the issue of notice u/s. 153A of the Act?

ii)    Whether the Income-tax Appellate Tribunal
was justified under the facts and circumstances of the case in confirming the
order of the Commissioner of Income-tax (Appeals) who has travelled beyond the
statutory provision of Chapter VI-A, u/s. 80-A(5) of the Income-tax Act, 1961
which clearly provides that if the assessee fails to make a claim in his return
of income of any deduction, no deduction shall be allowed to him thereunder?”

The
Allahabad High Court upheld the decision of the Tribunal and held as under:

“i)   Sri Manish Misra, the learned counsel for the
appellant contended that the return u/s, 153A is not a revised return but it is
a original return. If that be so, then in our view, deduction u/s. 80-IA, if
otherwise admissible, always could have been claimed and we are not shown any
authority otherwise to take a different view. Therefore, in both ways,
deduction u/s. 80-IA, if otherwise admissible could have been claimed by the
assessee. Hence we answer both the aforesaid questions in favour of the
assessee and against the Revenue affirming the view taken by the Tribunal.

ii)    It is next contended that there is another
substantial question of law that the assessee is not a “developer” but a
“contractor” and in this regard detailed finding has been recorded otherwise by
the Assessing Officer. The fact that the assessee was a “developer” and not a
“contractor” was a finding of fact concurrently recorded by the Commissioner
(Appeals) and the Appellate Tribunal, which was not shown to be perverse or
contrary to record. No substantial question of law arose.”