DCIT, Bangalore V. M/s Coco Latex Exports Pvt. Ltd., Bangalore

ITA 1042/BANG/2014

• Counselvise Citation: 104221114 RSA 2014
• Duration Of Justice: 9 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 05-08-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N BALAKRISHNA JT
• Section: 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH : BANGALORE BEFORE SHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI JASON P. BOAZ, ACCOUNTANT MEMBER ITA NO. 1042/BANG/2014 ASSESSMENT YEAR : 2007-08 THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 11(2), BANGALORE. VS. M/S. COCO LATEX EXPORTS PVT. LTD., NO.7, 1 ST MAIN, VASANTHNAGAR, BANGALORE 560 052. PAN: AABCC 5360M APPELLANT RESPONDENT APPELLANT BY : SHRI N. BALAKRISHNA, JT. CIT(DR) RESPONDENT BY : NONE DATE OF HEARING : 26.05.2015 DATE OF PRONOUNCEMENT : 29.05.2015 O R D E R PER N.V. VASUDEVAN, JUDICIAL MEMBER THIS APPEAL BY THE REVENUE IS AGAINST THE ORDER D ATED 25.3.2014 OF THE CIT(APPEALS)-I, BANGALORE RELATING TO ASSESSMEN T YEAR 2007-08. 2. THE ONLY ISSUE THAT ARISES FOR CONSIDERATION IN THIS APPEAL IS AS TO WHETHER THE CIT(APPEALS) WAS JUSTIFIED IN DIRECTING THE AO TO EXCLUDE SHIPPING CHARGES OF RS.1,80,29,037, FREIGHT CHARGES OF RS.3,627, MARINE INSURANCE OF RS.2,00,000 FROM BOTH THE EXPORT TURNO VER OF RS.16,13,43,923 ITA NO. 1042/BANG/2014 PAGE 2 OF 3 AND TOTAL TURNOVER OF RS.16,21,48,371, WHILE COMPUT ING DEDUCTION U/S. 10B OF THE ACT. 3. ACCORDING TO THE AO, AS PER THE DEFINITION OF EX PORT TURNOVER GIVEN IN CLAUSE (IV) TO EXPLANATION 2, THE EXPENSES INCURRED FOR FREIGHT EXPENSES ATTRIBUTABLE TO THE DELIVERY OF THE PRODUCT OR SOFT WARE OUTSIDE INDIA SHOULD BE REDUCED FROM THE EXPORT TURNOVER. HOWEVER, THE PROVISIONS OF SECTION 10B DO NOT PROVIDE FOR EXCLUSION OF SUCH EXPENDITUR E FROM TOTAL TURNOVER. IN THE ABSENCE OF A DEFINITION FOR TOTAL TURNOVER IN S ECTION 10B, THE NORMAL DEFINITION OF TOTAL TURNOVER HAS TO BE ADOPTED AND AS SUCH THE EXPENSES WHICH ARE REDUCED FROM THE EXPORT TURNOVER IN ACCOR DANCE WITH THE SPECIFIC DEFINITION CANNOT BE REDUCED FROM THE TOTAL TURNOVE R. 4. ON APPEAL BY THE ASSESSEE, THE CIT(APPEALS) FOLL OWING THE DECISION OF THE HONBLE HIGH COURT OF KARNATAKA IN THE CASE OF CIT V. TATA ELXSI LTD., 349 ITR 98 (KARN) , HELD THAT WHATEVER IS EXCLUDED FROM THE EXPORT TURNOVER, HAS ALSO TO BE EXCLUDED FROM THE TOTAL TU RNOVER. 5. AGGRIEVED BY THE ORDER OF THE CIT(APPEALS), THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 6. THE ONLY GRIEVANCE OF THE REVENUE IS THAT THE DE CISION OF HON'BLE HIGH COURT OF KARNATAKA IN TATA ELXSI (SUPRA) HAS NOT ATTAINED FINALITY AND A SLP BY THE DEPARTMENT IS PENDING BEFORE THE HON'B LE SUPREME COURT. WE ARE OF THE VIEW THAT AS OF TODAY, LAW DECLARED B Y THE HON'BLE HIGH COURT ITA NO. 1042/BANG/2014 PAGE 3 OF 3 OF KARNATAKA WHICH IS THE JURISDICTIONAL HIGH COURT IS BINDING ON US. WE THEREFORE HOLD THAT THE ORDER OF CIT(A) DOES NOT CA LL FOR ANY INTERFERENCE AND ACCORDINGLY THE SAME IS CONFIRMED. 7. IN THE RESULT, THE APPEAL BY THE REVENUE IS DISMISSED . PRONOUNCED IN THE OPEN COURT ON THIS 29 TH DAY OF MAY , 2015 . SD/- SD/- ( JASON P. BOAZ ) ( N.V. VASUDEVA N ) ACCOUNTANT MEMBER JUDICIAL MEMBE R BANGALORE, DATED, THE 29 TH MAY , 2015 . /D S/ COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR/ SENIOR PRIVATE SECRETARY ITAT, BANGALORE.