Karnataka High Court
Commissioner Of Income Tax-Iii vs M/S. Wipro Limited on 9 December, 2020
Bench: Alok Aradhe, H T Narendra Prasad
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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 9TH DAY OF DECEMBER 2020
PRESENT
THE HON'BLE MR. JUSTICE ALOK ARADHE
AND
THE HON'BLE MR. JUSTICE H.T.NARENDRA PRASAD
I.T.A. NO.403 OF 2012
BETWEEN:
1. COMMISSIONER OF INCOME TAX-III
C.R. BUILDING, QUEENS ROAD
BENGALURU.
2. ADDITIONAL COMMISSIONER OF INCOME TAX
RANGE-12, BENGALURU.
... APPELLANTS
(BY SRI. E.I. SANMATHI, ADV.,)
AND:
M/S. WIPRO LIMITED
DODDAKANNELLI
SARJAPUR ROAD
BENGALURU-560025
... RESPONDENT
(BY SRI. S. GANESH, SR. COUNSEL FOR
SRI. SANDEEP HUILGOL, ADV., FOR
SRI. R.B. KRISHNA, ADV.,)
---
THIS ITA IS FILED UNDER SECTION 260-A OF I.T. ACT,
1961 ARISING OUT OF ORDER DATED 18.07.2012 PASSED IN ITA
NO.1349/BANG/2010, FOR THE ASSESSMENT YEAR 2006-07,
ANNEXURE-A, PRAYING TO (I) DECIDE THE FOREGOING
QUESTION OF LAW STATED THERIEN. (II) SET ASIDE THE
APPELLATE ORDER DATED 18.07.2012 PASSED BY THE ITAT, 'B'
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BENCH, BANGALORE IN APPEAL PROCEEDINGS ITA
NO.1349/BANG/2010 ANNEXURE-A IN THE INTEREST OF JUSTICE
AND EQUITY.
THIS ITA COMING ON FOR FINAL HEARING, THIS DAY,
ALOK ARADHE J., DELIVERED THE FOLLOWING:
JUDGMENT
This appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as the Act for short) has been preferred by the revenue. The subject matter of the appeal pertains to the Assessment year 2006-07.
The appeal was admitted by a bench of this Court vide order dated 13.02.2013 on the following substantial questions of law:
(1) Whether on the facts and circumstances of the case, the tribunal is right in law in directing the assessing authority to set off the loss of the units in STP from other taxable business income even when the same is not permitted under provisions of IT Act?
(2) Whether on the facts and circumstances of the case, the tribunal is right in law in allowing the assessee's claim 3 of depreciation of Rs.19.46,23,236/- on software imported even though the assessing authority had rightly disallowed the expenditure under section 40(a)(i) of IT Act as the assessee had failed to comply with the provisions of section 195 while making payments to the vendors?
(3) Whether on the facts and circumstances of the case, the tribunal is right in law in setting aside the reallocation of expenditure done by assessing authority relating to expenditure booked by Wipro Corporate division to other divisions even though the said re-allocation by the assessing authority was in accordance with law?
(4) Whether on the facts and circumstances of the case, the tribunal is right in law in setting aside the exclusions made by assessing authority relating to interest income, foreign exchange fluctuations and income from sale of scrap from the profits of 10A?
4(5) Whether on the facts and circumstances of the case, the tribunal is right in law in setting aside the re-allocation of Corporate Expenses even though the assessing authority was right in holding that in absence of such allocation of expenses, the profits of the units eligible for deduction in chapter VIA would be artificially enhanced?
(6) Whether on the facts and circumstances of the case, the order of the tribunal can be said as perverse in nature as the tribunal has relied on its earlier decisions which have not reached finality since appeals preferred by Revenue under section 260A against those orders are pending before this Hon'ble High Court in ITA No.363 of 2009 and other connected matters and as such tribunal ought to have awaited decision of this Hon'ble High Court?
(7) Whether on the facts and circumstances of the case, the tribunal is right in law in setting aside the computation of deduction u/s.10A of IT Act whereby the 5 assessing authority had rightly excluded a sum of Rs.2257,70,94,710/- from the export turnover by holding that the said sum was incurred in providing technical services outside India?
(8) Whether on the facts and circumstances of the case, the Tribunal is right in law in setting aside deduction done by the assessing authority under section 10A of IT Act by excluding a sum of Rs.13,07,29,648/- received after 30-09- 2006 from the export turnover even when the assessing authority had right held that the said sum was not remitted to India within 6 months from the end of the previous years in terms of section 10-A(3)?
(9) whether on the facts and circumstances of eh case, the tribunal is right in law in setting aside the reallocation of corporate expenses to the extent of Rs.1,15,45,780/- to unit in Pondecherry eventhough the said re-allocation of expenses by the assessing authority was in accordance with the provisions of law?
6(10) Whether on the facts and circumstances of the case, the tribunal is right in law in confirming the decision of the Commissioner of Income Tax (Appeals) in directing the assessing authority to set off the loss of the units in STP from taxable business income?
(11) Whether on the facts and circumstances of the case, the tribunal is right in setting the order of the assessing authority with regard to re-computation of deduction at Rs.850,46,91,962/- u/s.10- A/10-B, 10AA of the Income Tax Act eventhough the same was in accordance with aforesaid provisions of the IT Act?
(12) Whether on the facts and circumstances of the case, the tribunal is right in setting aside the order of the assessing authority with regard to disallowance of the set off of loss of Rs.24,62,222/- incurred in unit eligible for deduction under section 80-IC against the taxable income from business by invoking 7 section 880-IC(7) read with section 80- IA(s) of IT Act?
(13) Whether, on the facts and circumstances of the case, the tribunal is right in setting aside the order of the assessing authority relating to the reallocation of corporate expenses to the extent of Rs.57,76,956/- to Wipro Consumer Care Division?
(14) Whether, on the facts and circumstances of the case, the tribunal is right in law in setting aside the order of the assessment relating to issue of excluding the profits from software development centre outside India for the purpose of deduction under section 10-A of IT Act?
(15) Whether, on the facts and circumstances of the case, the tribunal is right in law in setting aside the order of the assessing authority relating to the reallocation of expenses in respect of 80-IC unit?
8(16) Whether on the facts and circumstances of the case, the tribunal is right in law in setting aside the order of the assessment relating to the issue of deduction under section 10-A on enhanced profit after disallowing compensation of Rs.12.15 Crore, the tribunal erred in setting aside the same even though the same was in accordance of provisions of IT Act?
2. Learned counsel for the revenue submits that all the remaining issues covered by decisions of this court in M/S WIPRO LTD. VS. DCIT, 383 ITR 179 (KAR) and 'COMMISSIONER OF INCOME-TAX & ANOTHER VS. TATA ELXSI LTD.' 382 ITR 654 (KAR) are pending adjudication at the instance of the revenue before the Supreme Court. In view of aforesaid submission needless to state that the Assessing Officer shall decide the issues in accordance with the decision which may be rendered by the Supreme Court.
93. For the reasons assigned by us in the judgment passed today in I.T.A.No.464/2017, this appeal also stands disposed of in the same terms and with similar directions.
Sd/-
JUDGE Sd/-
JUDGE ss