TRANSWORLD TERMINALS DADRI PVT LTD.,,MUMBAI vs. ACIT, CIR-14(1)(1), MUMBAI

These are three appeals filed by the assessee Transworld Terminals Dadri Private Limited formerly known as Albatross Inland Ports Private Limited for A.Y. 2012-13,

We first take up A.Y. 2012-13, where the assessee has raised the solitary ground of appeal stating that a sum of ₹18,97,000/- reported under the head ‘other income’ was held to be not eligible for deduction under Section 80IA of the Income-tax Act, 1961 (the Act).

The brief fact shows that assessee is a company engaged in the business of operating a Container Freight Station (CFS). It filed its return of income on 26th September, 2012 at a total income of ₹9,31,26,170/-. Assessee is eligible for deduction under Section 80IA of the Act. Assessee has shown ‘other incomes’ of rent received, interest on fixed deposits, interest on IT refund, balances written back and miscellaneous income totaling to ₹18,97,000/-. These are the income pertains to the Dadri Unit, which is eligible for deduction under Section 80IA of the Act. Assessee did not exclude the above income from the eligible profit derived from the industrial undertaking of Dadri unit while computing deduction under Section 80IA of the Act. The learned Assessing Officer raised a query on the above issue and ultimately held that above income is not derived from industrial undertaking and

Aggrieved by the assessment order assessee preferred an appeal before the National Faceless Appeal Centre, wherein the appeal of the assessee was dismissed. Therefore, the assessee is in appeal before us.

The learned Authorized Representative submitted that identical issue arose in case of the assessee for A.Y. 2009- 10, wherein co-ordinate Bench in passed an order on 01st October, 2018 holding that a. The rent received by the assessee is directly related to the main business of the assessee, as assessee being a CFS providing space to facilitate customers and other associated on rent. Accordingly, rent was held to be income derived from eligible undertaking eligible for deduction under Section 80IA of the Act.

The learned Departmental Representative supported the orders of the lower authorities.

We have carefully considered the rival contentions and perused the orders of the lower authorities. We have also carefully considered the order of the co-ordinate Bench in assessee’s own case for A.Y. 2009-10 to 2010-11 dated 1st October, 2018. During the year, the assessee has received rent of ₹11,23,000/-, interest on fixed deposits receipt of ₹6,01,000/-, interest on income tax refund of ₹25,000/- balances written back of ₹63,000/- and further miscellaneous income of ₹85,000/-. All these income have been considered by the co-ordinate Bench in assessee’s own case as income eligible for deduction u/s 80 IA of The

Ground no.2, is against the initiation of penalty proceedings, which is premature and therefore, same is dismissed. Accordingly, A.Y. 2012-13 is partly allowed.

Ground no.1, is with respect to the other income of ₹39,53,831/- not considered as eligible for deduction under Section 80IA of the Act by the lower authorities. The issue is decided in the appeal of the assessee for A.Y. 2012-13. With a similar direction ground no.1 of the appeal is partly allowed.

Ground no.2 is against the initiation of penalty proceedings, which is premature in nature and therefore, same is dismissed.

Accordingly, for A.Y. 2014-15 is partly allowed.

Ground no.2 of the appeal is against the initiation of penalty proceedings. It is premature and hence, same is dismissed.

Accordingly, all the three appeals filed by the assessee are partly allowed.