Kerala High Court
/ Appellant vs / on 5 January, 2011
Author: M.L.Joseph Francis
Bench: C.N.Ramachandran Nair, M.L.Joseph Francis
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR
&
THE HONOURABLE MR.JUSTICE M.L.JOSEPH FRANCIS
THURSDAY, THE 27TH DAY OF SEPTEMBER 2012/5TH ASWINA 1934
RP.No. 455 of 2012 () IN ITA/10/2010
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AGAINST THE ORDER/JUDGMENT IN ITA.10/2010 DATED 05/01/2011
REVIEW PETITIONER(S):/ APPELLANT
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IVL INDIA (P) LIMITED,
TECHNO PARK, THIRUVANANTHAPURAM
BY ADVS.SRI.E.K.NANDAKUMAR (SR.)
SRI.A.K.JAYASANKAR NAMBIAR
SRI.K.JOHN MATHAI
SRI.P.BENNY THOMAS
SRI.P.GOPINATH
RESPONDENT(S):/ RESPONDENT
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THE COMMISSIONER OF INCOME TAX,
THIRUVANANTHAPURAM.
BY SHRI.P.K.R. MENON, SR.STANDING COUNSEL, INCOME TAX DEPT.
THIS REVIEW PETITION HAVING COME UP FOR ADMISSION ON 27-09-2012, THE
COURT ON THE SAME DAY PASSED THE FOLLOWING:
C.N.RAMACHANDRAN NAIR, &
M.L.JOSEPH FRANCIS, JJ.
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R.P. No.455 of 2012 in
I.T.A. No.10 of 2010
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Dated this the 27th day of September, 2012.
ORDER
Ramachandran Nair, J.
Review Petition is filed by the assessee contending that factual mistakes are there in the order of the Tribunal and the same continued even in the judgment of this court because this court followed Tribunal's findings on facts. We have heard Senior counsel Sri.Jayasankar Nambiar for the review petitioner and also Standing Counsel for the respondent.
2. Question raised is computation of profit on export of computer software under Section 80HHE of the Income Tax Act which provides for computation of deduction of profit on export of software in the same way export profit is computed under Section 80 HHC of the Act. The specific grievance raised in the R.P. is that 90% of the consultancy charges received in convertible foreign exchange is excluded by applying Explanation (d) to Section 80HHE(3) of the Act which is 2 similar to Explanation (baa) to Section 80HHC of the Act. While counsel for the review petitioner submitted that consultancy is part of the export business and the receipts referred to are received from foreign clients in convertible foreign exchange, Standing Counsel submitted that disallowance may be on receipts received in Indian rupee from consultancy rendered locally. This is certainly a factual issue which calls for verification by the Assessing Officer. If the assessee' case is correct, then 90% of the receipts cannot be included in the computation of export profit eligible for deduction. On the other hand, if the consultancy charges received are in Indian rupee for service rendered in India, exclusion is certainly called for. We dispose of the R.P. directing the Assessing Officer to verify the factual position and apply the law as stated above.
C.N.RAMACHANDRAN NAIR Judge M.L.JOSEPH FRANCIS Judge pms