Karnataka High Court
The Commissioner Of Income Tax vs Sun Microsystems India Pvt Ltd on 6 April, 2015
Bench: Vineet Saran, S.Sujatha
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IN THE HIGH COURT OF KARNATAKA AT
BENGALURU
DATED THIS THE 6TH DAY OF APRIL 2015
PRESENT
THE HON'BLE MR.JUSTICE VINEET SARAN
AND
THE HON'BLE MRS.JUSTICE S SUJATHA
ITA NO.203 OF 2009
BETWEEN
1. THE COMMISSIONER OF INCOME TAX
C R BUILDING
QUEENS ROAD
BANGALORE
2. THE ASST. COMMISSIONER OF INCOME TAX
CIRCLE -12(3)
C.R.BUILDING
QUEENS ROAD
BANGALORE
... APPELLANTS
(BY SRI K V ARAVIND, ADV.)
AND
SUN MICROSYSTEMS INDIA PVT LTD
6TH FLOOR, DIVYASHREE CHAMBERS
LANGFORD ROAD
BANGALORE 560025.
... RESPONDENT
(BY SRI A SHANKAR & SRI M LAVA, ADV)
THIS ITA IS FILED UNDER SECTION 260-A OF
I.T.ACT, 1961 ARISING OUT OF ORDER DATED 14-11-
2008 PASSED IN ITA NO.661/BNG/2008, FOR THE
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ASSESSMENT YEAR 2003-2004, PRAYING THAT THIS
HON'BLE COURT MAY BE PLEASED TO:
I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW
STATED THEREIN,
II. ALLOW THE APPEAL AND SET ASIDE THE ORDER
PASSED BY THE ITAT BANGALORE IN ITA
NO.661/BNG/2008, DATED 14-11-2008, CONFIRMING
THE ORDER OF THE APPELLATE COMMISSIONER AND
CONFIRM THE ORDER PASSED BY THE ASSISTANT
COMMISSIONER OF INCOME TAX, CIRCLE-12(3),
BANGALORE IN THE INTEREST OF JUSTICE AND
EQUITY.
THIS APPEAL COMING ON FOR ADMISSION THIS
DAY, VINEET SARAN J., DELIVERED THE FOLLOWING:
JUDGMENT
We have heard Sri K.V.Aravind, learned Counsel appearing for the appellants as well as Sri A.Shankar, learned Counsel appearing for the respondent and perused the record.
2. The sole question involved in the present appeal is as to whether after the amendment brought in sub-section 4 of Section 10A of the Income Tax Act, 1961 with effect from 01.04.2001, while computing the deduction the total turnover of the undertaking is to be 3 considered or the total turnover of the business of the Company is to be considered ?
3. The brief facts of this case are that on the basis of the amended provision of subsection (4) of Section 10A of the Income Tax Act, 1961 (hereinafter referred to as 'the Act' for brevity), the assessee had filed his returns which were accepted by the Assessing Officer. The Commissioner re-opened the matter under Section 263 of the Act and was of the opinion that the order of the Assessing Officer was erroneous as well as prejudicial to the interest of the Revenue, as according to the Commissioner of the Income Tax, the turnover of the entire business of the Company ought to have been considered and not of the undertaking in question. In the appeal filed by the assessee, the Tribunal has set aside the order of the Commissioner of Income Tax. Aggrieved by the said order, this appeal has been filed by the Revenue raising the following substantial question of law: 4
"Whether the Tribunal was correct in setting aside the order passed u/s.263 of the Act, where the commissioner had held that the computation of deduction u/s.10A of the Act when computing total income should be in respect of both STP units as well as non-STP units i.e., in respect of the entire company has been contrary to the provision and without jurisdiction?"
4. Learned Counsel for the appellants has not been able to justify as to how after the amendment of sub-section (4) of Sub-section 10A of the Act with effect from 01.04.2001, the total turnover of the business carried on by the assessee could have been considered and not the total turnover of the business carried on by the undertaking, as has been provided by the amended provision.
5. Learned Counsel for the appellants then submitted that even though the interpretation taken by the Assessing Officer may be correct, no reasons have been given by the Assessing Officer in arriving 5 at such a conclusion and thus the order was rightly taken up for revision under Section 263 of the Act.
6. We are unable to accept the said submission of the learned Counsel for the appellants, as by accepting the return filed by the assessee in which the requisite details had been given, it was not necessary for the Assessing Officer to give detailed reasons, although it could be said that had such reasons been given, it may have been better. However, the order cannot be said to be erroneous in sofar as it is prejudicial to the interests of the revenue or taken up for revision under Section 263 of the Act, merely because no reasons had been given, even though the order of the Assessing Officer was in terms of the amended provision of Section 10A(4) of the Act. As such, we are of the view that no substantial question of law arises for determination of this Court.
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7. The appeal is accordingly dismissed.
Sd/-
JUDGE Sd/-
JUDGE JT/-