The metal crash barriers, pedestrian guard rails, etc., got damaged due to road accidents and other regular wear and tear needed to be replaced. The assessee claims that the scrap has been generated in the regular course of business of operation and maintenance of the toll highway. Thus, a part of a normal business transaction is eligible for deduction u/s 80IA. The AO has treated the income from the sale of scrap and insurance receipts received by the assessee as “income from other sources”. Consequently, it has not allowed deduction u/s 80IA of the Act.  The Tribunal noted that the deductions had been allowed in the earlier year, wherein it was held that the sale of scrap was generated in the ordinary course of business and it was not a case of independent purchase and sale of scrap items, and it is a case where such scrap items were generated from the same business on which deduction u/s 80IA is claimed.   The assessee claimed that the insurance receipts are towards a claim made in respect of assets used in the toll operation activity which got damaged, and such receipts are incidental to its activity of maintaining and operating the highway.  The Tribunal noted that the insurance claims regarding assets used in the toll operations were capitalized and form part of the block of assets. The receipts arising from insurance claims will reduce the block of assets instead of being eligible for deduction under section 80IA of the Act.  (AY. 2010-11)