R.S. Syal, A.M. - This appeal by the assessee is directed against the order passed by the CIT(A) on 18th Oct., 2004 in relation to the assessment year 2001-2002.

2. First ground deals with the denial of the benefit of deduction claimed by the assessee under section 80-IA of the Income-tax Act, 1961 (hereinafter referred to as ‘Act’), amounting to Rs. 3,32,43,204 which was claimed on the net income shown by virtue of execution of work on Built-Operate-Transfer (BOT) basis.

A. Factual scenario

Facts leading to this dispute are that the assessee filed its return showing income of Rs. 11,13,360. As the income-tax payable on the total income as computed under the Act was less than 7.5 per cent of its book profits, the assessee paid tax @ 7.5 per cent of the book profits under section 115JB of the Act. During the year, the assessee derived income from pavement of road on contract basis, execution of work on BOT basis and providing funds on interest. It had shown toll tax receipts of Rs. 6,93,06,756 from the execution of work on BOT basis and after claiming operating and maintenance expenses at Rs. 3,60,63,552, showed a profit of Rs. 3,32,43,204. This amount was claimed as deductible un