80-IA Deduction

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Vasudevan (Querist)
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04 September 2007 I am in the construction industry developing IT parks and leasing it to STPI clients. To avail 80-IA benefits, the deduction is extended only for profits and gains derived.

1. please clarify whether this deduction can be exended to House Property Income wherein the rentals received from clients has to be considered as Income from House property based on so many case laws. Will the Dept disallow 80-IA benefits if this is being treated as House Property Income.

2. Our activity is not only letting of bare shell but also providing facilities viz., Air conditioning, DG backup etc., Can we consider rentals as Business Income and if so, on what basis we can consider as Business Income. Would request for case laws also to support the stand.

3. Also the objects in MOA of the company includes leasing of the property and based on this can we consider as Business Income and avail 80-IA benefits.

CMA Gul S

CMA Gul S (Expert)
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14 September 2007 Hello Mr Vasudevan,

I do not think you would get the deduction u/s 80-IA. The Ownership would be yours and you would be getting the Lease Rent for the property leased.

This would be House Property Income and not the Business Income