The court determined insufficient grounds for eco-tourism eligibility under section 80IC of the Income Tax Act, leading to the dismissal of the appellant's claims.

ORDER

PER VIMAL KUMAR, JM:

1. The appeal of the Assessee against order dated 20/02/2018 of the Learned Commissioner of Income Tax (Appeals), Dehradun [hereinafter referred to as ‘Ld. CIT(A)’] arising from assessment order dated 26/12/2016 passed u/s 143(3) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) of the Dy. Commissioner of Income Tax, Haridwar (hereinafter referred as ‘Ld. AO’) for the Assessment Year 2014-15.

2. Brief facts of case are that appellant/assessee is engaged in the running of hotel Ganges Riera in Haridwar. Assessee filed her return of income on 06/09/2014 declaring total income of Rs.35,66,030/-. The case was selected for scrutiny through CASS. Notice u/s 143(2) of the Act, was issued to the appellant/assessee on 31/08/2015. Notices u/s 142(1) of the Act dated 02/05/2016 and other dates were issued. In compliance to these notices, Sh. Ankit Verma, CA, Authorized Representative of the assessee appeared from time to time and submitted necessary documents and replies. Books of accounts were produced which were test checked. On completion of assessment proceedings, Ld. AO passed order dated 26/12/2016.

3. Appellant/assessee preferred the appeal before Ld. CIT(A) which was dismissed vide order dated 20/02/2018.

4. Being aggrieved appellant/assessee preferred present appeal with following grounds:-

“1. That on the facts and circumstances of the case and in the law, the CIT(A) has grossly erred in confirming the assessment made by the Assessing Officer (‘AO’) at an income of Rs.46,17,590/- as against the return of income of Rs.36,66,030.

2. That on the facts and circumstances of the case and in the law the CIT(A) has grossly erred in confirming the disallowance u/s 80-IC of Rs.10,51,559 as made by the AO.”

5. None appeared on behalf of the appellant/assessee on 10/07/2024 and 19/08/2024. Even today at the time of arguments, no one appeared on behalf of the appellant/assessee. Ld. Departmental Representative relied on the impugned orders.

6. From examination of record, in the light of aforesaid submissions, it is crystal clear that Ld. CIT(A) upheld the order of Ld. AO by observing as under:

“21. I have carefully considered the matter at hand. The main issue is what is the right definition of eco-tourism. The Act does not define this and in a similar matter (Aanchal Hotel Pvt. Ltd.) the Hon’ble High Court has remanded this matter back to be decided on the facts of the case.

22. The submissions of the assessee have been perused. The assessee has mentioned several eco-friendly measures that it has taken in the course of running of its hotel, the efforts made in assisting guests in local travel, the support of local handicrafts and talent and even the food that is cooked in its kitchens.

23. It has been noticed that all these facilities that the assessee speaks of are common to any hotel. While it is true that the term ‘hotel’ is used in the facilities that are eligible for the deduction in question, the question must be decided in the proper context.

24. The purpose of allowing this deduction is to provide incentives to those institutions that are adding value to the etiology and the environment. Despite the claims of the assessee, to hold that a hotel situated on the main Haridwar Delhi Highway is one of the institutions that the legislature had in mind seems far-fetched.

25. In any case, the Hon’ble High Court has asked the authorities below to decide the issue on facts. The assessee has been unable to bring out any special fact that distinguishes the activity of its establishment moves beyond the ambit of ‘tourism’ to the realm of ‘eco-tourism’. In the absence of any definition in the Act, the AO has fallen back on the dictionary! meaning of the word ‘eco-tourism’. Under th