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6. Aggrieved with the order of the CIT(A) the assessee is before us.

7. The learned counsel for the assessee, Mr. C.S. Agrawal, has submitted before us that the tenderer was permitted to assign, sub-let to any other party or parties the whole or any portion of the work under the contract with the approval of the Engineer-in-Chief, PWD, by virtue of clause 7.1 of the tender and the expression tenderer shall also include its successors, legal representatives and permitted assignees as per the preamble of the agreement. It means the State Government has agreed under this agreement that whenever work contract was assigned by the tenderer in favour of some other person, the assignee shall step into the shoes of the tenderer and all the terms and conditions of the tender shall be enforceable against the assignees and for all practical purposes the agreement shall be treated to have been executed between die State Government and the assignee if the entire contract under the tender is assigned. Mr. Agrawal also invited our attention to the definition of assignment with the submission that according to the Webster's DICTIONARY "assignment" has been defined as 'a specified task or amount of work assigned or undertaken as if assigned by authority, the transfer of property; esp: the transfer of property to be held in trust or to be used for the benefit of creditors. Mr, Agrawal further contended that after obtaining the tender from the State Government M/s. Ajay Construction entered into an agreement with Smt. Usha Agrawal, the promoter of the assessee-company, and assigned the entire contract in favour of the company to be incorporated by its promoter in near future and thereafter the entire construction work was undertaken by the promoter of the assessee-company and the assessee-company after its incorporation itself. Since the acts and deeds of the promoter of assessee-company were adopted by the assessee-company itself, the entire contract work has been executed by the assessee-company and as such there was really a novation resulting in substitution of liabilities, none-the-less as a result of novation it can really be not justifiably contended that the enterprise has not entered into a contract with the State Government. He further invited our attention to the letters of the State Government through which they have granted permission of assignment in favour of the assessee and authorised the assessee to collect the toll tax. While authorising the assessee to collect the toll tax the State Government has admitted that the permission for assigning the work in favour of the assessee was granted on the same terms and conditions of the contract as entered with M/s. Ajay Construction and by virtue of the tripartite agreement between the State Government, M/s. Ajay Construction, the original bidder and M/s. Ayush Ajay Construction Private Limited (the assessee), the assessee stepped into the shoes of M/s. Ajay Constructions. Since the State Government has admitted that the assessee has stepped into the shoes of the original bidder, M/s. Ajay Construction on the same terms and conditions, it is not proper to hold that there was no agreement between the State Government and the assessee for construction of the bridge on BOT basis.

12. On consideration of the rival submissions advanced by the parties and from a careful perusal of the orders of the authorities below and the documents placed on record, we find that originally the tender for construction of bridge on river Bakur was submitted by M/s. Ajay Construction, a proprietorship concern, on 16-6-1994 and the same was finally granted to M/s. Ajay Construction on 14-2-1995. Admittedly, at the time when the tender was granted to M/s Ajay Constructions, the provisions of section 80-IA(4A) were not brought to the statute. When the proposal to this effect was made in the budget speech by the Finance Minister, M/s. Ajay Construction entered into an agreement with Smt. Usha Agrawal, promoter of the assessee-company vide agreement dated 1-4-1995 and assigned the tender/contract for construction of Bakur bridge on BOT. As per the said agreement, whatever expenses were borne by M/s. Ajay Construction were taken over by Smt. Usha Agrawal on behalf of the assessee-company to be incorporated in future. After the agreement, the construction work was undertaken by Smt. Usha Agrawal till the incorporation of the assessee-company and after the incorporation the construction work was carried on by the assessee-company. It is also evident from record that as per the terms and conditions of the tender, the tenderer, M/s. Ajay Construction, was permitted to sub-let or assign the whole contract or any part of it in favour of any person or enterprises with the approval of the State Government. The preamble of the tender also speaks that the expression "tenderer" would also include its successors, representatives and permitted assignees. A copy of the tender/agreement is placed at pages 20-91 of the compilation. From a careful perusal of the terms and conditions of the agreement/tender dated 14-2-1995, we would find that the original tender can be assigned in favour of any person or enterprise with the approval of Engineer-in-Chief, PWD, and if the whole contract is assigned, the assignee would step into the shoes of the tenderer on the same terms and conditions of the contract originally set out with the tenderer. It is also evident from record that after obtaining the approval from the State Government, a fresh agreement was executed between M/s. Ajay Construction and the assessee-company and the assessee- company owned and rectified all acts and deeds done by Shit. Usha Agrawal, promoter of the assessee-company. All the expenses incurred by Smt. Usha Agrawal prior to the incorporation of the assessee-company were also owned and taken by the assessee-company through the agreement dated 21-7-1995. It is also evident from record that the assessee has claimed to have incurred expenditure of Rs. 68,96,514.61 ps. in the construction of the aforesaid bridge. As the operatingperiod of daily collection was 705 days, the assessee-company has treated the expenditure as deferred revenue expenditure and charged the same to P&L account in the following years :--

13. On the basis of tripartite agreement executed between the assessee, M/s. Ajay Construction and the State Government, the assessee had claimed deduction under section 80-IA(4A) of the Act which was rejected by the Assessing Officer and the CIT(A) on the ground that the assessee did not enter into an agreement with the State Government for construction of the aforesaid bridge on BOT basis, which is sine qua non for claiming the aforesaid deduction. Now, the short question before us is whether there was an agreement between the assessee-company with the State Government for construction of the aforesaid bridge on BOT basis or whether the assessee has stepped into the shoes of M/s. Ajay Construction, the original tenderer, after obtaining the assignment of the entire contract with the approval of the Chief Engineer, PWD, on the same terms and conditions of the agreement/tender settled between M/s. Ajay Construction and the State Government or whether by virtue of legal assignment of a tender/contract in favour of the assessee, the assessee is entitled to claim the deduction under section 80-IA(4A) of the Act.

Admittedly, M/s. Ajay Construction, the original tenderer, have assigned the remaining work of the contract/tender alongwith the expenditure incurred by it to Smt. Usha Agrawal, the promoter of the assessee-company through an agreement dated 1-4-1995 and thereafter the construction work was undertaken by the promoter of the assessee-company till its incorporation. When the permission of the assignment was granted by the State Government, fresh agreement was executed between the assessee-company and the main tenderer, M/s. Ajay Construction, in which the assessee-company has rectified all the deeds and acts of its promoter, Smt. Usha Agrawal, and owned/taken over all the assets and liabilities of its promoter. The action of assigning and the work of construction undertaken by the assessee was recognised by the State Government and a tripartite agreement was executed between the asses-see, M/s. Ajay Construction and the State Government through which the State Government have recognised that the assessee has stepped into the shoes of M/s. Ajay Construction and notified authorising the assessee to collect the toll tax for a particular period. A copy of the letter dated 22-5-2000 to this effect is also placed before us. The assessee has also placed various correspondence entered into between the assessee and the Slate Government and the letter dated 26-8-1995 through which the assessee was informed about the notification in his favour to collect the toll tax. A copy of the letter placed at page 140 of the compilation of the assessee. Copies of the notification and various receipts of toll tax are also placed on record for our perusal. It is also revealed from various correspondence of the assessee with the State Government that the assignment of contract was duly recognised by the State Government and it was admitted by them that the actual construction work was undertaken by the assessee only.