Yellow Pages publishers entitled to tax benefit, says ITAT

In a significant relief to the publishers of Yellow Pages, a tax tribunal in the Tata Yellow Pages case clarified that they would get tax benefits like the publisher of any other book.

In a significant relief to the publishers of Yellow Pages, a tax tribunal in the Tata Yellow Pages case clarified that they would get tax benefits like the publisher of any other book.

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As Tata Infomedia, publisher of Yellow Pages, "was engaged in the business of publication of books in terms of provisions of section 80Q of the (Income Tax) Act...The assessee was entitled to (tax) deduction," ruled the Mumbai bench of the Income Tax Appellate Tribunal (ITAT).

Under Section 80Q of the I-T Act, a publisher can claim 20 per cent tax deduction by reducing his taxable income by the same amount.

Pursuant to the ITAT clarification, which will have a bearing on the tax liability of publishers of Yellow Pages, Tata Infomedia can claim tax benefits under the I-T Act.

The ITAT decision follows an appeal filed by Tata Infomedia against the decision of the tax department, which held that Yellow Pages cannot be classified as books and hence their publishers cannot claim tax benefits under the I-T Act.

Rejecting the contention of the tax department, the ITAT held that Yellow Pages are also books and are entitled to tax benefits under the Act.