Deduction u/s 80IA is allowed unit wise

DCIT Vs Gujarat JHM Hotels Ltd. (ITAT Surat)

Held that deduction under Section 80IA of the Income Tax Act is to be allowed unit wise without deducting incurred loss by the other unit of eligible business and allowed the appeal of assessee.

Facts-

The assessee is engaged in the business of hotel and also have power generation windmills. During the reassessment, AO noted that the assessee has incurred losses from the eligible business of generation of power. The assessee claimed deduction u/s 80IA(iv) of Rs. 1,06,84,759/-. AO was of the view that deduction u/s 80IA is allowable only when the income is earned i.e. profit is shown from the eligible business.

AO held that the assessee maintained consolidated figure of power generation units and no separate and independent books of account was maintained by the assessee for each and every wind mill, hence, the profit/loss of each wind mill cannot be ascertained from the incomplete record, therefore, deduction under Section 80IA of Rs. 1.068 crore was disallowed.

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