Case Law Details
Gujarat Info Petro Ltd Vs DCIT (ITAT Ahmedabad)
ITAT Ahmedabad held that as the revenue from selling of bandwidth business of the assessee is shared between the assessee and its parent company, profits eligible to deduction under section 80IA(4)(ii) of the Income Tax Act is reducible.
Facts- The assessee-company is engaged in the business of selling internet bandwidth and other value added services like webhosting, designing, development and maintenance of websites etc. During the impugned assessment year i.e.Asst.Year 2008-09, the assessee had claimed deduction u/s. 80lA(4)(ii) of the Act amounting to Rs. 1,56,59,743/-. The deduction u/s. 80IA is available to the undertakings which are engaged in providing telecommunication services, where basic of cellular, including radio paging, domestic satellite services, network of trunk, broad-bandnet-work and internet services at any time after 31st March, 1995 before 31st March, 2005, subjected to fulfillment of certain conditions as specified in section 80IA of the Act.
AO denied the claim u/s 80IA(4)(ii) on account of not having filed requisite form no. 10CCB. The denial of claim of deduction u/s 80IA was upheld by CIT(A).
Conclusion- We find that the Ld. CIT(A) had categorically noted that the satellite equipment, navigation equipment and other linked equipments admittedly owned by the promoter company i.e. GSPL were all vital not only for the satellite business of the assessee, but also for optic figure business. He has categorically noted that the navigation equipment and other linked equipments were necessary for providing services through optical fibre also. The assessee has been unable to controvert this fact before us. Further, we have noted that the ld.CIT(A) has considered allocation of revenue sharing in both the satellite and optic fibre bandwidth selling business, considering ownership of all these equipments by GSPL and considering business activities by the assessee.
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