Income earned from hoarding advt. placed on foot over bridge & bus shelter eligible for deduction u/s 80-IA

Principal Commissioner of Income Tax v. Vantage Advertising (P.)

Limited, High Court of Calcutta

The assessee was engaged in the business of advertising. It had constructed the foot over bridge and bus shelter and earned income from advertisement on hoardings on such foot over bridge and bus shelter. Assessing officer denied deduction under section 80-IA on ground that income from advertisement could not be said to be income derived by an undertaking from business of infrastructure development.
Assessee claimed depreciation in respect of hoardings at 100 per cent on account of non durability of its structures. Assessing Officer restricted depreciation on hoardings at 50 per cent on ground that they were used for less than 180 days.

Tribunal held that the assessee is engaged in infrastructure development which involves construction of foot over bridge as well as the bus shelter and, therefore, the assessee is entitled to deduction under section 80IA of the Act. The Tribunal followed the decision of this Court in the case of CIT v. Selvel Advertising (P.) Ltd. [IT Appeal No. 49 of 2010, dated 22-4-2010] which was also a similar matter wherein an advertising company engaged in infrastructure development has erected automatic traffic signal and pedestrian foot over bridge.
Deprecation on hoardings to be allowed at 100 per cent even if they were put to use for less than 180 days due to non-durability of such structures.

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