EIT Services India Private Limited (formerly known as Hewlett Packard Globalsoft Pvt. Ltd.) V. Assistant Commissioner of Income-Tax-Circle 3(1)(2) and Principal Commissioner of Income Tax-3

ITA/118/2017

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The case involves EIT Services India Private Limited, formerly known as Hewlett Packard Globalsoft Pvt. Ltd., appealing against an order of the Income Tax Appellate Tribunal dated 17.10.2016. The appeal was filed under Section 260-A of the Income Tax Act, 1961, challenging the Tribunal's decision on several substantial questions of law related to the assessment year 2004-2005. The primary contention revolved around the Tribunal's jurisdiction to address issues arising from the CIT's order under Section 263 and the correctness of setting off losses of Units eligible for deduction under Section 10A. The High Court's decision rendered two of the substantial questions academic due to the efflux of time and answered the second substantial question in favor of the assessee based on a Supreme Court decision.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 689883 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 24-03-2021
• Assessment Year: misc
• Other Referred Cases: Commissioner of Income-tax vs. Yokogawa India Ltd. (2017) 77 taxmann.com 41 (SC)
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: MAHIMA GOUD
• Keywords: Assessment Year 2004-2005; Deduction under Section 10A; Income tax appeal; Substantial questions of law; Order of Tribunal; Setting off of loss
• Section: 143(3); 263; 10A; 260-A

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 24TH DAY OF MARCH, 2021 PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND THE HON’BLE MR. JUSTICE M.G.S. KAMAL I.T.A. NO.118 OF 2017 BETWEEN: EIT SERVICES INDIA PRIVATE LIMITED (FORMERLY KNOWN AS HEWLETT PACKARD GLOBALSOFT PVT. LTD.) 39/40, ELECTRONIC CITY, PHASE-II, HOSUR ROAD, BANGALORE-560 100 REPRESENTED HEREIN BY ITS DIRECTOR, MR. M.S. PRAKASH ...APPELLANT (BY MS.MAHIMA GOUD, ADVOCATE FOR SRI T.SURYANARAYANA, ADVOCATE) AND: 1. ASSISTANT COMMISSIONER OF INCOME-TAX-CIRCLE 3(1)(2)(ERSTWHILE DEPUTY COMMISSIONER OF INCOME-TAX-CIRCLE 11(4), 2ND FLOOR, BMTC BUILDING, 80 FT ROAD, KORAMANGALA 6TH BLOCK BANGALORE-560 095. 2 2. PRINCIPAL COMMISSIONER OF INCOME TAX-3 BMTC BUILDING, KORAMANGALA 6TH BLOCK, BANGALORE-560 095. …RESPONDENTS (BY SRI E.I.SANMATHI, ADVOCATE FOR SRI K.V.ARVIND, ADVOCATE) - - - THIS ITA IS FILED UNDER SECTION 260-A OF INCOME TAX APPEAL ACT 1961, ARISING OUT OF ORDER DATED:17/10/2016 PASSED IN IT(TP)A NO.1211/BANG/2012, FOR THE ASSESSMENT YEAR 2004- 2005 ANNEXURE-K PRAYING TO (i) FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE (ii) ALLOW THE APPEAL AND SET ASIDE THE ORDER OF THE TRIBUNAL DATED:17/10/2016 PASSED IN IT(TP)A NO.1211(BANG)2012 (ANNEXURE-K), TO THE EXTENT QUESTIONED HEREIN; AND (iii) PASS SUCH OTHER OR SUITABLE ORDERS AS THIS HON'BLE COURT DEEMS FIT TO PASS ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN THE INTEREST OF JUSTICE AND EQUITY. THIS ITA COMING ON FOR HEARING, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING: JUDGMENT Ms.Mahima Goud, learned counsel for Shri T.Suryanarayana, learned counsel for the assessee. Shri E.I.Sanmathi, learned counsel for Shri K.V.Aravind, learned counsel for the revenue. 3 This appeal under Section 260-A of the Income Tax Act, 1961 has been filed by the assessee against the order dated 17.10.2016 passed by the Income Tax Appellate Tribunal. 2. The appeal was admitted by a Bench of this Court by order dated 14.11.2017 on the following substantial questions of law: \"Whether on the facts, in the circumstances and on the grounds and contentions urged: (i) the Tribunal was justified in holding that only issues arising out of order passed by the CIT under Section 263 of the Act can be appealed against before the Tribunal in the proceedings arising out of the order passed by the Assessing Officer under Section 143(3) of the Act pursuant to such order under Section 263 of the Act, although the CIT(A) himself had dismissed the appeal against the original assessment order as being infructuous for the reason that the CIT had set aside the assessment order to make a fresh assessment? (ii) the Tribunal was justified in not adjudicating on the correctness or otherwise of 4 setting off of loss of a Unit eligible for deduction under Section 10A of the Act against the profits of other Units entitled for a similar deduction under Section 10A of the Act? (iii) The Tribunal ought to have remanded the entire matter to the CIT(A) for de novo consideration of all the issues arising both from the original assessment order as well as from the order giving effect to the order passed under Section 263 of the Act?\" 3. When the matter was taken up today, learned counsel for the assessee submitted that the substantial questions of law namely substantial question Nos.(i) and (iii) have been rendered academic on account of efflux of time. It is further submitted that the second substantial question of law namely substantial question No.(ii) has been answered in favour of the assessee by a decision of the Hon'ble Supreme Court in the case of Commissioner of Income-tax vs. Yokogawa India Ltd. reported in (2017) 77 taxmann.com 41 (SC). 5 4. The aforesaid aspect of the matter has not been disputed by the learned counsel for the revenue. 5. In view of the aforesaid submission, it is not necessary for us to answer the substantial questions of law namely substantial question Nos.(i) and (iii) and the second substantial question of law namely substantial question No.(ii) is answered in favour of the assessee and against the revenue. 6. In the result, the impugned order dated 17.10.2016 insofar as it contains the finding with regard to substantial question No.(ii) is hereby quashed. The appeal is disposed of. Sd/- JUDGE Sd/- JUDGE CA "