Deduction U/S 80-IA Is Eligible For Industrial Undertakings Even If Infrastructural Development Is Performed With State's Nodal Agency: Calcutta HC

The Calcutta High Court has confirmed that deductions under Section 80-IA of the Income Tax Act are available to industrial undertakings engaged in infrastructure development, even if the development is performed with a state government’s nodal agency. The case involved a company that developed a mechanized port handling system at Kakinada Deep Water Port in collaboration with a nodal agency appointed by the Andhra Pradesh government. The court observed that the deduction is intended to promote industrial undertakings involved in infrastructure development and should be interpreted to advance this objective. The court noted that the company met the conditions for the deduction, as the infrastructure facility was recognized by the state government and customs authorities. The ruling clarifies that agreements with nodal agencies fulfill the requirements of Section 80-IA, thereby supporting the broader goal of encouraging infrastructure projects through tax incentives.