Karnataka High Court
The Pr. Commissioner Of Income-Tax vs M/S Autodesk India Pvt Ltd on 24 September, 2024
Author: S.G.Pandit
Bench: S.G.Pandit
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NC: 2024:KHC:39753-DB
ITA No. 338 of 2019
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 24TH DAY OF SEPTEMBER, 2024
PRESENT
THE HON'BLE MR JUSTICE S.G.PANDIT
AND
THE HON'BLE MR JUSTICE C.M. POONACHA
INCOME TAX APPEAL NO. 338 OF 2019
BETWEEN:
1. THE PR. COMMISSIONER OF INCOME-TAX,
5TH FLOOR, BMTC BUILDING,
80 FEET ROAD, KORAMANGALA,
BENGALURU -560095.
2. THE ASST. COMMISSIONER OF INCOME TAX
CIRCLE 1(1)(1), 2ND FLOOR,
BMTC BUILDING, 80 FEET ROAD,
KORAMANGALA, BENGALURU- 560095.
...APPELLANTS
(BY SRI. RAVIRAJ Y. V., ADV. A/W
SRI DILIP M., ADV.)
AND:
Digitally signed
by M/S AUTODESK INDIA PVT LTD.,
MARIGANGAIAH UNIT A-4, A-WING, 2ND FLOOR,
PREMAKUMARI DIVYASHREE CHAMBERS,
Location: HIGH LANGFORD ROAD,BENGALURU- 560025.
COURT OF PAN: AABCA 6924B.
KARNATAKA ...RESPONDENT
(BY SMT. TANMAYEE RAJKUMAR, ADV.)
THIS APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX
ACT 1961, ARISING OUT OF ORDER DATED 21.12.2018 PASSED
IN IT(TP)A NO.156/BANG/2016, FOR THE ASSESSMENT YEAR
2011-2012, PRAYING TO I. FORMULATE THE SUBSTANTIAL
QUESTIONS OF LAW STATED ABOVE; II. ALLOW THE APPEAL
AND SET ASIDE THE ORDERS PASSED BY THE INCOME-TAX
APPELLATE TRIBUNAL, BENGALURU IN IT(TP)A
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NC: 2024:KHC:39753-DB
ITA No. 338 of 2019
NO.156/BANG/2016 DATED 21.12.2018 FOR ASSESSMENT YEAR
2011-2012 ANNEXURE-D AND CONFIRM THE ORDER OF THE
DRP CONFIRMING THE ORDER PASSED BY THE ASST.
COMMISSIONER OF INCOME TAX, CIRCLE - 1(1)(1),
BENGALURU AND ETC.
THIS APPEAL, COMING ON FOR ORDERS, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR JUSTICE S.G.PANDIT
AND
HON'BLE MR JUSTICE C.M. POONACHA
ORAL JUDGMENT
(PER: HON'BLE MR JUSTICE S.G.PANDIT) Heard the learned counsel Sri.Raviraj.Y.V., along with Sri.Dilip.M., learned counsel for appellants/Revenue and learned counsel Smt.Tanmayee Rajkumar for respondent/assessee.
2. The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short, 'the Act') questioning the correctness and legality of order dated 21.12.2018 passed by the Income Tax Appellate Tribunal, 'C' Bench, Bengaluru (for short, 'Appellate Authority') in IT(TP)A.No.156/Bang/2016 for the assessment year 2011-12.
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NC: 2024:KHC:39753-DB ITA No. 338 of 2019
3. This Court, admitted the appeal on 24.10.2019 to consider the following substantial question of law:
"i. Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting the comparable companies, M/s.Acropetal Technologies Ltd., M/s.ICRA Techno Analytics Ltd., M/s.Infosys Technologies Ltd., M/s.Tata Elxsi Ltd., M/s.Persistent Systems and Solutions Ltd., and M/s.Persistent Systems Ltd., following the decision of the co-ordinate bench in the case of Applied Material (I) Pvt., Ltd., in IT(TP)A No.17 & 39/Bang/2016 without analyzing the facts in depth and ignoring evidence brought on record by TPO?
ii. Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting the comparable companies, M/s.E- Infochips Ltd., and M/s.E-Zest Solutions Ltd., following the decision of the co-ordinate bench in the case of M/s.Commonscope networks (I) Pvt. Ltd., in IT(TP)A No.166 & 181/Bang/2016 without analyzing the facts in depth and ignoring evidence brought on record by TPO?
iii. Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting M/s.Larsen & Turbo Infotech Ltd., on the -4- NC: 2024:KHC:39753-DB ITA No. 338 of 2019 grounds of functional dissimilarity without analyzing the facts in depth ignoring evidence brought on record by TPO?
iv. Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting M/s.ICC International Agencies Ltd., by relying on the decision of the co-ordinate bench in the case of M/s.Electronic Imaging (1) Pvt. Ltd., Vs. DCIT (2017) 85 taxmann.com 124 (Bangalore-Trib) without analyzing the facts in depth ignoring evidence brought on record by TPO?
V. Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting certain comparable companies selected by the TPO merely following the decision of the co- ordinate benches in the case of different assesses, when it ought to have decided the comparability of these companies on the basis of specific facts brought on record by the TPO in the case of respondent - assessee?"
4. Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct -5- NC: 2024:KHC:39753-DB ITA No. 338 of 2019 Taxes. It is also submitted that the aforesaid Circular binds the revenue.
5. On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under the aforesaid Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024.
6. In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned counsel for the revenue. However, the question of law is kept open to be adjudicated in an appropriate proceeding.
Sd/-
(S.G.PANDIT) JUDGE Sd/-
(C.M. POONACHA) JUDGE MPK CT:bms List No.: 2 Sl No.: 0