Brief of the case:
ITAT Mumbai held in the case of M/s Hiranandani Builders Vs ITO that the followings receipts were also eligible for deduction u/s 80IA considering the same to be profits from undertakings:
- Interest on IT refund
- Other Interest
- FDR Interest
- Tender fees
Further ITAT was of the view that the interest on refunds was on the TDS deducted from the lease rentals which was the main business of assesse and the TDS was also the part of lease rentals which had been received in the form of refund. So the same should be allowed for deduction u/s 80IA.
The amount of interest received on the late payment of lease rentals from the lessee should also be allowed for deduction u/s 80IA because it was the internal part of lease rentals.
The assesse had received interest on FDR amount accumulated from receipt of lease rental which was in link with the main business of the assesse. If the assesse had not invested the amount in FDR then the assesse would have repaid the loan or interest on the same which would have reduced the interest liability
Tender fees was the fees collected by the assesse when it raised tender for the construction of the assesse’s projects so that should be allowed for deduction u/s 80IA.
Facts of the case:
The assesse was operating 2 IT parks and 1 SEZ and claimed deduction u/s 80IA for profits and gain derived by an undertaking from any business referred to in sub section (4). Under the provisions of sec. 80IA(4)(iii), the deduction u/s 80IA(1) shall be allowable to an undertaking which develops, develops and operates or maintains and operates an industrial park or special economic zone notified by the Central Government in accordance with the scheme framed. The assesse also claimed the deduction of the following items:
