ACIT, Pune V. M/s Digite Infotech P.Ltd. [ Erstwhile M/s. Tufan Infotech [I] P.Ltd ], Pune

ITA 1081/PUN/2012

• Counselvise Citation: 108124514 RSA 2012
• Duration Of Justice: 1 year(s) 6 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 13-11-2013
• Assessment Year: 2005-2006
• Appeal Filed On: 28-05-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P L PATHADE
• Keywords: Additional evidence

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH A , PUNE BEFORE: SHRI G. S. PANNU, ACCOUNTANT MEMBER AND SHRI R.S. PADVEKAR, JUDICIAL MEMBER ITA NO. 1081/ PN/201 2 ASSESSMENT YEAR : 2005 - 06 ASST. COMMISSIONER OF INCOME TAX, CIRCLE - 7, PUNE VS. M/S. DIGITE INFOTECH PVT. LTD. (ERSTWHILE M/S. TUFAN INFOTECH INDIA PVT. LTD.), 73/3/2, BHAKTI MARG, OPP. - LAW COLLEGE ROAD, PUNE - 411004 (APPELLANT) (RESPONDENT) PAN NO. AAACD5995L APPELLANT BY: SHRI P.L. PATHADE RESPONDENT BY: S HRI KISHORE PHADKE DATE OF HEARING : 20 - 11 - 2013 DATE OF PRONOUNCEMENT : 29 - 11 - 2013 ORDER P ER R.S. PADVEKAR , JM : - IN THIS APPEAL, THE REVENUE HAS CHALLENGED THE IMPUGNED ORDER OF THE LD. CIT(A) - III, PUNE DATED 29 - 04 - 2011 FOR THE A.Y. 2005 - 06 . TH E REVENUE HAS TAKEN FOLLOWING GROUNDS IN THE APPEAL: 1. THE LD. CIT(A) HAS ERRED IN ADMITTING THE ADDITIONAL EVIDENCE WITHOUT GIVING OPPORTUNITY TO THE A.O. 2. THE CIT(A) HAS ERRED IN ISSUING DIRECTIONS TO THE A.O. TO EXAMINE THE FRESH CLAIM OF THE ASSESSEE. 2 . THE BRIEFLY STATED FACTS ARE AS UNDER. THE ASSESSEE IS ENGAGED IN THE COMPUTER SOFTWARE AND IT ENABLED SERVICES. THE ASSESSEE FILED THE RETURN OF INCOME FOR THE A.Y. 2005 - 06 IN WHICH THE DEDUCTION U/S. 10A HAS BEEN CLAIMED AT RS.56,39,563/ - . AS PER TH E AUDIT ORS REPORT THE FOREIGN EXCHANGE WORTH RS.1,14,41,510/ - HAD NOT BEEN BROUGHT TO INDIA AND THE COMPANY APPLIED TO THE RBI THROUGH THE AUTHORIZED DEALER TO ALLOW ADDITIONAL TIME. THE ASSESSING OFFICER PROCEEDED TO DETERM INE THE 2 ITA NO. 1081/PN/2012, M/S. DIGITE INFOTECH PVT. LTD., PUNE EXPORT TURNOVER IN VIE W OF EXPLANATION - 2 OF SEC.10A OF THE INCOME - TAX ACT AND EXPORT TURNOVER WAS REDUCED BY THE AMOUNT/FOREIGN EXCHANGE WHICH WAS NOT REQUIRED BY THE ASSESSEE . IN CONSEQUENCE THE DEDUCTION WAS ALSO REDUCED THAT WAS RESTRICTED TO RS. 44,64,289/ - AS PER THE COMPU TATION GIVEN IN THE ASSESSMENT ORDER. THE ASSESSEE CHALLENGED THE ACTION OF THE ASSESSING OFFICER BEFORE THE LD. CIT(A). THE ASSESSEE CONTENDED THAT HE HAD MADE TOTAL EXPORT TURNOVER OF RS.5,71,97,712/ - . IT WAS ALSO CONTENDED THAT DURING THE PROCESS OF AUDIT , THE DEDUCTION WAS CONFINED TO A LOWER FIGURE OF RS.4,57,56,202/ - CONSIDERING THE DETAILS OF FIRC AND FOREIGN EXCHANGE REALIZATIONS INFORMATION AVAILABLE AT THAT TIME AND THE AMOUNT OF RS.1,14,41,510/ - WAS REFLECTED AS NOT ELIGIBLE FOR DEDUCTION U/S. 10A AS PER THE AUDIT REPORT. 2.1. IT WAS SUBMITTED THAT THE THEN AUDIT CERTIFICATE WAS, THUS, BASED ON DATA MADE AVAILABLE AT THE TIME OF AUDIT AND BASED ON THE PERIOD OF 6 MONTHS CONSIDERED FOR REALIZATION OF THE EXPORT PROCEEDS. IT WAS ALSO CONTENDE D THAT THE UN - REALIZED AMOUNT AS QUANTIFIED BY THE AUDITOR HAS SUBSEQUENTLY BEEN REALIZED BY THE ASSESSEE COMPANY WITHIN THE ALLOWED TIME LIMIT OF 6 MONTHS FROM THE END OF THE FINANCIAL YEAR. IT WAS ACCORDINGLY CLAIMED BEFORE LD. CIT(A) THAT THE ASSESSEE WAS ENTITLED TO CLAIM THE DEDUCTION ON THE ENTIRE EXPORT TURNOVER. THE ASSESSEE ALSO FURNISHED THE EVIDENCE AS WELL AS THE DETAILS BEFORE THE LD. CIT(A). THE LD. CIT(A) HELD THAT DURING THE PERIOD FROM 01 - 04 - 2005 TO 30 - 09 - 2005 , T HE ASSESSEE HAS REALIZED THE AMOUNT TO THE EXTENT OF RS.1,57,52,400/ - WHICH INCLUDES THE UNREALIZED AMOUNT OF RS.1,14,41,510/ - RELATING TO EXPORT S OF THE YEAR UNDER CONSIDERATION , THE DEDUCTION U/S. 10A SHOULD BE GRANTED IN RESPECT OF SAID EXPORT PROCEEDS I.E. RS.1,14,41,510/ - ALS O OR TO THE EXTENT OF EXPORT PROCEEDS REALIZED ON OR BEFORE 30 - 09 - 2005. THE LD. CIT(A) ACCORDINGLY, ISSUE D THE DIRECTIONS TO THE ASSESSING OFFICER. THE OPERATIVE PART OF THE FINDINGS AND DIRECTIONS IS AS UNDER: 3 ITA NO. 1081/PN/2012, M/S. DIGITE INFOTECH PVT. LTD., PUNE 6.1.2. FROM THE ABOVE DETAILS FURNISHED BY THE APPELLANT, IT COULD BE NOTICED THAT FOREIGN INWARD REMITTANCES AMOUNT TO RS.1,57,52,400/ - (EQUIVALENT TO USD 361,932/ - ) WERE REALIZED DURING THE PERIOD 01/04/2005 TO 30/09/2005. ACCORDING TO THE APPELLANT, THE SAID RECEIPTS OF RS.15,752,400/ - INCLUDE THE UNREALIZED AMOUNT OF RS.1,14,41,510/ - AS QUALIFIED BY THE AUDITOR IN THE ORIGINAL FORM NO. 56F. TO A SPECIFIC QUERY AS TO WHY THE AUDITOR IN FORM NO. 56F QUALIFIED THAT AN AMOUNT OF RS.1,14,41,510/ - WAS NOT ELIGIBLE FOR DEDUCTION U/S. L0A, THE LD. A R SUBMITTED THAT THE THEN AUDIT CERTIFICATE WAS BASED ON DATA MADE AVAILABLE AT THE TIME OF AUDIT AND HARD COPIES OF FIRCS FOR THE BALANCE REALIZATIONS WERE NOT MADE AVAILABLE TO THE AUDITORS. IT WAS ALSO SUBMITTED BY THE APPELLANT THAT DURING THE ASSESSMENT PROCEEDINGS, THE APPELLANT COULD NOT PRODUCE THE DETAILS OF THE BALANCE FOREIGN EXCHANGE RECEIPTS AS THE MAIN FINANCE PERSON OF THE APPELLANT COMPANY LEFT THE JOB ALL OF A SUDDEN. THUS, IT WOULD APPEAR FROM THE DETAILS FURNISHED THAT UN - REALIZED AMOUNT OF RS.1,14,41,510/ - AS QUALIFIED BY THE AUDITOR IN THE ORIGINAL FORM NO. 56F HAS SUBSEQUENTLY BEEN REALIZED BY THE COMPANY WITHIN THE STIPULATED TIME LIMIT OF SIX MONTHS FROM THE END OF THE F.Y. IN THE PRESENT PROCEEDINGS, THE APPELLANT ALSO FURNISHED A RE VISED FORM NO. 56F INDICATING THE ABOVE RECEIPTS. HOWEVER, SINCE THE EVIDENCES RELATING TO REALIZATION OF BALANCE EXPORT PROCEEDS WITHIN A PERIOD OF SIX MONTHS FROM THE END OF THE YEAR WERE NOT FILED BEFORE THE ASSESSING OFFICER, I AM OF THE OPINION THAT T HIS IS A FIT CASE FOR ISSUE OF DIRECTION TO THE ASSESSING OFFICER TO EXAMINE THE FRESH CLAIM OF THE APPELLANT THAT THE BALANCE EXPORT PROCEEDS WERE ALSO REALIZED WITHIN THE STIPULATED TIME. IF IT IS FOUND ON DUE VERIFICATION THAT THE REALIZATIONS MADE O F RS.1,57,52,400/ - DURING THE PERIOD 01/04/2005 TO 30/09/2005 INCLUDES UNREALIZED AMOUNT OF RS.1,14,41,510/ - RELATING TO THE EXPORTS OF THE YEAR UNDER CONSIDERATION, THE DEDUCTION U/S. 10A SHALL BE GRANTED IN RESPECT OF THIS EXPORT PROCEEDS OF RS.1,14,41,5 10/ - ALSO OR TO THE EXTENT OF EXPORT PROCEEDS REALIZED ON OR BEFORE 30 TH SEPT. 2005. SUBJECT TO THESE DIRECTIONS, THE GROUNDS OF APPEAL RAISED IN THIS REGARD ARE PARTLY ALLOWED. NOW THE REVENUE IS IN APPEAL BEFORE US. 3. WE HAVE HEARD THE PARTIES. THE MAIN GRIEVANCE OF THE REVENUE IS THAT THE CIT(A) HAS NO POWER TO SET ASIDE THE MATTER TO THE ASSESSING OFFICER FOR VERIFICATION. MOREOVER, THE ADDITIONAL EVIDENCE WAS ADMITTED WITHOUT GIVING OPPORTUNITY TO THE ASSESSING OFFICER . I N OUR OPINION THE GRIEVA NCE OF THE REVENUE IS WITHOUT ANY MERIT. WE FIND THAT AS PER THE EVIDENCE PRODUCED BY THE ASSESSEE , THE LD. CIT(A) HAS GIVEN THE FINDING FOR THE LIMITED PURPOSE OF VERIFICATION AND THE DIRECTIONS ARE GIVEN . I T IS NOT A CASE OF SETTING ASIDE THE MATTER KE EPING THE ISSUE OPEN FOR FRESH 4 ITA NO. 1081/PN/2012, M/S. DIGITE INFOTECH PVT. LTD., PUNE ADJUDICATION . S O FAR AS GRIEVANCE OF THE ADDITIONAL EVIDENCE IS CONCERNED , IN OUR OPINION , THE POWERS OF THE LD. CIT(A) ARE CONCERNED THOSE ARE CO - TERMINUS WITH THE POWERS OF THE ASSESSING OFFICER AND THE LD. CIT(A) IS COMPE TENT TO ADMIT ANY RELEVANT EVIDENCE. WE FIND NO MERIT IN THE GROUNDS TAKEN BY THE REVENUE. 4. IN THE RESULT, THE REVENUES APPEAL IS DISMISSED. PRONOUNCED IN THE OPEN COURT ON 29 - 11 - 2013 SD/ - SD/ - ( G.S. PANNU ) ( R.S. PADVEKAR ) ACCOUNTANT ME MBER JUDICIAL MEMBER RK /PS PUNE , DATED : 29 TH NOVEMBER, 20 1 3 COPY TO 1 ASSESSEE 2 DEPARTMENT 3 THE CIT(A) - III, PUNE 4 THE CIT - III, PUNE 5 THE DR, ITAT, A BENCH, PUNE . 6 GUARD FILE. //TRUE COPY// BY ORDER PRIVATE SECRETARY INCOME TAX APPELLATE TRIBUNAL PUNE