Income Tax Appellate Tribunal - Bangalore
M/S Aditi Technologies Pvt. Ltd.,, ... vs Department Of Income Tax on 3 September, 2012
IN THE INCOME TAX APPELLATE TRIBUNAL
BANGALORE BENCH "B"
BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND
SHRI JASON P. BOAZ, ACCOUNTANT MEMBER
I.T.A. No.120/Bang/2012
(Assessment Year : 2008-09)
Income Tax Officer,
Ward 11(1), Bangalore. .... Appellant.
Vs.
M/s. Aditi Technologies (P) Ltd.,
C-4 Blocki, Wing A, Manyata Embassy Business Park,
Rachanahalli, Nagavara Village,
Outer Ring Road, Bangalore-560 045. ..... Respondent.
PAN AADCA 1576D
Appellant By : Shri S. Ranganath.
Respondent By : Shri Farat Hussain Qureshi.
Date of Hearing :3.9.2012.
Date of Pronouncement : 07.09.2012.
O R D E R
Per Shri Jason P. Boaz :
This appeal by Revenue is directed against the order of the Commissioner of Income Tax (Appeals)-I, Bangalore dt.2.11..2011. for Assessment Year 2008-09.
2. The facts of the case, in brief, are as under:
2.1 The assessee-company (herein after referred to as 'the assessee'), in the business of software development and export thereof, filed its return of income for Assessment Year 2008-09 on 25.10.2008 declaring NIL income. The return was processed under section 143(1) of the Income Tax Act, 1961 (herein after referred to as 'the Act') and 2 ITA No.120/Bang/2012 the case was taken up for scrutiny by issue of notice under section 143(2) dt.17.8.2009.
The Assessing Officer completed the assessment by an order under section 143(3) of the Act dt.24.12.2010 determining the income of the assessee at Rs.12,39,24,812. In doing so the Assessing Officer reworked the eligible deduction under section 10A of the Act by excluding communication expenses, travelling expenses in foreign currency and foreign branch expenses from the Export Turnover without reducing the same from the Total Turnover of the assessee.
2.2 Aggrieved by the order of assessment dt.24.12.2010, the assessee went in appeal before the CIT(A). The learned CIT(A) disposed off the appeal by order dt.2.11.2011 giving the assessee partial relief in as much as he directed the Assessing Officer to recompute the eligible deduction under section 10A of the Act after reducing communication expenses of Rs.54,50,077, travelling expenses in foreign currency of Rs.1,85,77,752 both from export turnover and total turnover following the decision of the jurisdictional High Court of Karnataka in the assessee's own case in ITA No.823 of 2009 dt.30.8.2011.
3. Aggrieved by the order of the learned CIT(A), revenue has preferred this appeal. In the grounds of appeal raised, it has been contended as follows :
" 1. The order of the learned CIT(A), in so far as it is prejudicial to the interest of Revenue, is opposed to law and the facts and circumstances of the case.
2. The learned CIT(A) was not justified in directing the Assessing Officer to recomputed the deduction allowable under section 10A of I T Act, 1961 after 3 ITA No.120/Bang/2012 reducing the communication expenses of Rs.54,50,077, travelling expenses in foreign currency of Rs.1,85,77,752 and foreign branch expenses of Rs171,95,82,177 both from the 'export turnover' and the 'total turnover', without appreciating the facts and circumstances of the case.
3. The learned CIT(A) has erred in not appreciating that there is no provision in sectin 10A, which requires the above mentioned expenses to be reduced from the 'total turnover'.
4. The learned CIT(A) erred in allowing the relief, relying on the decision of the Hon'ble High Court in the assessee's case for earlier year, which has not been accepted by the department and SLP has been recommended to be filed before the Hon'ble Supreme Court under section 261 of the I T Act, 1961 against such order.
5. For these and such other grounds that may be urged at the time of hearing, it is humbly prayed that the order of the CIT(A) be reversed in so far as the above mentioned issue is concerned and that of the Assessing Officer be restored.
6. The appellant craves leave to add, to alter, to amend or to delete any of the grounds that may be urged at the time of hearing of the appeal."
4. A perusal of the grounds of appeal at S.Nos.1, 5 and 6 indicate that they are general in nature and therefore no adjudication is called for thereon. 5.1 The grounds raised at S.Nos. 2 to 4 are in respect of the issue of the eligible deduction under section 10A of the Act. The learned Departmental Representative reiterating the grounds of appeal submitted that the learned CIT(A) erred in directing the Assessing Officer to recompute the deduction under section 10A of the Act after reducing communication expenses, travelling expenses incurred in foreign currency and foreign branch expenses both from export turnover and total turnover. This, he submitted was raised despite the fact that the decision of the Hon'ble High Court of Karnataka in the assessee's own case in ITA No.823 of 2009 dt.30.8.2011 being in favour 4 ITA No.120/Bang/2012 of the assessee on this very point, as the Department has not accepted the decision and were in the process of filing a SLP before the Hon'ble Apex Court. 5.2 The learned counsel for the assessee supported the finding of the learned CIT(A) on this issue, which he submitted was covered in favour of the assessee by the decision of the Hon'ble High Court of Karnataka in ITA No.823 of 2009 dt.30.8.2011. In view of this, he pleaded that the learned CIT(A) order be upheld and revenue's appeal dismissed. 5.3 We have heard both parties and carefully perused the material on record as well as the judicial decisions cited. We are of the considered opinion that the issue in dispute is covered in favour of the assessee by the decision of the Hon'ble High Court of Karnataka in the assessee's own case in ITA No.823 of 2009 dt.30.8.2011. In this view of the matter, respectfully following the decision of the Hon'ble High Court of Karnataka in the assessee's own case in ITA No.823 of 2009 dt.30.8.2011, we uphold the order of the learned CIT(A) dt.2.11.2011 wherein he has directed the Assessing Officer to recomputed the deduction under section 10A of the Act after reducing communication expenses, travelling expenses incurred in foreign currency and foreign branch expenses both from export turnover and total turnover.
6. In the result, revenue's appeal is dismissed.
Order pronounced in the open court on 7th Sept., 2012.
Sd/- Sd/-
(N.V. VASUDEVAN) (JASON P BOAZ)
Judicial Member Accountant Member
*Reddy gp
5
ITA No.120/Bang/2012
Copy to :
1. Appellant
2. Respondent
3. C.I.T.
4. CIT(A)
5. DR, - B Bench.
6. Guard File.
(True copy) By Order
Sr. Private Secretary, ITAT, Bangalore