Income Tax Officer, Ward -16(1), Hyderabad V. M/s Mega Cyber Tech Ltd, Secunderabad

ITA 1497/HYD/2012

• Counselvise Citation: 149722514 RSA 2012
• Duration Of Justice: 1 year(s) 8 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2004-2005
• Appeal Filed On: 01-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P MURALI MOHAN RAO
• Keywords: Tax effect
• Section: 10B

Judgement Text

1 ITA.NO.1497/HYD/2012 M/S. MEGA CYBER TECH LTD., HYDERABAD. IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCHES B : HYDERABAD BEFORE SHRI B. RAMAKOTAIAH, ACCOUNTANT MEMBER AND SHRI SAKTIJIT DEY, JUDICIAL MEMBER ITA.NO.1497/HYD/2012 ASSESSMENT YEAR 2004-2005 INCOME TAX OFFICER WARD 16(1) HYDERABAD. VS. M/S. MEGA CYBER TECH LTD., HYDERABAD PAN-AACCM-3869-N (APPELLANT) (RESPONDENT) FOR REVENUE MR. SOLGY JOSE T. KOTTARAM FOR ASSESSEE MR. P. MURALI MOHAN RAO DATE OF HEARING 03.06.2014 DATE OF PRONOUNCEMENT 06.06.2014 ORDER PER B. RAMAKOTAIAH, A.M. THIS APPEAL BY REVENUE IS DIRECTED AGAINST THE ORDER OF CIT(A)-V, HYDERABAD DATED 12.07.2012 FOR T HE A.Y. 2004-2005. THE ONLY GRIEVANCE OF THE REVENUE IN THI S APPEAL IS AGAINST THE ACTION OF THE LD. CIT(A) IN ALLOWING TH E DEDUCTION UNDER SECTION 10B OF THE I.T. ACT, 1961 TO THE ASSE SSEE WHICH WAS DISALLOWED BY THE A.O. ON THE REASON THAT EVEN THOUGH ASSESSEE HAS OBTAINED APPROVAL FROM STPI ON 13.07.2 009, RATIFICATION BY THE BOARD OF APPROVALS HAD NOT TAKE N PLACE. 2. FOLLOWING THE COORDINATE BENCH DECISION IN THE CASE OF ITO VS. M/S. SECUNDERABAD SOFTWARE SERVICES P. LTD., SECUNDERABAD IN ITA.NO.1501/HYD/2011 DATED 10.04.20 12, LD. CIT(A) ALLOWED THE DEDUCTION TO THE ASSESSEE HO LDING THAT 2 ITA.NO.1497/HYD/2012 M/S. MEGA CYBER TECH LTD., HYDERABAD. ASSESSEE HAVING BEEN REGISTERED WITH STPI IS ENTITL ED FOR DEDUCTION UNDER SECTION 10B OF THE ACT. 3. LEARNED D.R. RELIED ON THE ORDERS OF THE A.O. WHEREAS, LD. COUNSEL OBJECTED THAT THE TAX EFFECT I N THIS CASE IS LESS THAN RS. 3 LAKHS AND ON MERITS COVERED BY THE COORDINATE BENCH DECISION IN THE CASE OF ITO VS. M/S. SECUNDER ABAD SOFTWARE SERVICES P. LTD., SECUNDERABAD IN ITA.NO.1 501/HYD/ 2011 DATED 10.04.2012. 4. WE HAVE CONSIDERED THE RIVAL CONTENTIONS. REVENUE HAS PREFERRED APPEAL CLAIMING EXEMPTION UND ER THE BOARD INSTRUCTION AS SIMILAR ISSUE MAY BE RECURRING IN OTHER YEARS ALSO. THEREFORE, WE CONSIDER THE APPEAL ON ME RITS. LD. CIT(A) FOLLOWED THE COORDINATE BENCH DECISION IN TH E CASE OF ITO VS. M/S. SECUNDERABAD SOFTWARE SERVICES P. LTD. (SUPRA) WHEREIN THIS ISSUE WAS DISCUSSED ELABORATELY AND AL LOWED THE DEDUCTION UNDER SECTION 10B HOLDING AS UNDER : 6. WE HEARD THE PARTIES AND PERUSED THE IMPUGNED ORDERS OF THE LOWER AUTHORITIES. THE ONLY QUESTION THAT CLINCHES THE ISSUE INVOLVED IN THIS APPEAL IS WHETH ER FOR BECOMING ELIGIBLE TO THE DEDUCTION UNDER S.10B OF T HE ACT, WHETHER IT IS ENOUGH IF THE ASSESSEE IS REGISTERED WITH SOFTWARE TECHNOLOGY PARK OF INDIA AS A 100% EOU OR IT IS ALSO NECESSARY FOR THE ASSESSEE TO HAVE THE APPROVA L OF THE BOARD CONSTITUTED BY THE CENTRAL GOVERNMENT UND ER S.14 OF THE INDUSTRIES (DEVELOPMENT AND REGULATION) ACT, 1951. THE CIT(A) HAS DECIDED THIS ISSUE IN FAVOUR O F THE ASSESSEE, AND HELD THE ASSESSEE AS ELIGIBLE FOR DED UCTION UNDER S.10B OF THE ACT, FOLLOWING THE DECISIONS OF THE CO- ORDINATE BENCHES OF THE TRIBUNAL IN THE FOLLOWING C ASES - (A) VSN MAKRO TECHNOLOGY P. LTD. V/S. ACIT (ITA NO.1057/HYD/2010) DATED 13.1.2011, WHEREIN THE STIL L EARLIER DECISION OF THE TRIBUNAL IN THE CASE OF INF OTECH ENTERPRISES LTD. (SUPRA), RELIED BY THE ASSESSING O FFICER IN THE IMPUGNED ASSESSMENT ORDER HAS BEEN CONSIDERED A ND 3 ITA.NO.1497/HYD/2012 M/S. MEGA CYBER TECH LTD., HYDERABAD. THE SAME HAS BEEN HELD TO BE INAPPLICABLE AS THE SA ME HAS BEEN RENDERED PRIOR TO ISSUANCE OF INSTRUCTION NO.1 DATED 31.3.2006 BY THE CBDT AND LETTER DATED 23.3.2 006 ISSUED BY THE MINISTRY OF COMMUNICATIONS AND TECHNOLOGIES. (B) DCIT V/S. VALLIANT COMMUNICATION LTD. (ITA NO.2706/DEL/2008 DATED 23.4.2010) (2010-TIOL-452- ITAT-DEL), WHEREIN THE STILL EARLIER DECISION OF TH E DELHI BENCH IN THE CASE OF ITO VS. REGENCY CREATIONS LTD. (ITA NO.4006/DEL/2006) DATED 13.4.2006 HAS BEEN FOLLOWED . (C) SMT. K.SUDHA RANI V/S. ITO (ITA NO.1750/HYD/2008) DATE 30.10.2009 CONSISTENT WITH THE VIEW TAKEN BY VARIOUS BENCH OF THE TRIBUNAL, INCLUDING THE BENCHES AT HYDERABAD, IN SI MILAR MATTERS, WE HOLD THAT THE ASSESSEE, HAVING BEEN REG ISTERED WITH THE STPI, IS ENTITLED FOR DEDUCTION UNDER S.10 B OF THE ACT. IN THAT VIEW OF THE MATTER, WE FIND NO INFIRMI TY IN THE IMPUGNED ORDER OF THE CIT(A), WHICH IS ACCORDINGLY CONFIRMED AND THE GROUNDS OF THE REVENUE ARE REJECTED. 5. LD. CIT(A) ORDER IS IN CONSONANCE WITH THE ORDE R OF THE COORDINATE BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. M/S. SECUNDERABAD SOFTWARE SERVICES P. LTD., SECUND ERABAD (SUPRA) AND THEREFORE, WE DO NOT SEE ANY REASON TO INTERFERE WITH THE ORDER OF THE LD. CIT(A) AND DISMISS THE GR OUNDS OF REVENUE. 6. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 06.06.2 014. SD/- SD/- (SAKTIJIT DEY) (B.RAMAKOTAIAH) JUDICIAL MEMBER ACCOUNTANT MEMBER HYDERABAD, DATE 06 TH JUNE, 2014 VBP/- 4 ITA.NO.1497/HYD/2012 M/S. MEGA CYBER TECH LTD., HYDERABAD. COPY TO 1. INCOME TAX OFFICER, WARD-16(1), HYDERABAD 2. M/S. MEGA CYBER TECH LTD., 1 ST FLOOR, SHYAM TOWERS, SD ROAD, SECUNDERABAD. 3. CIT(A)-V, HYDERABAD. 4. CIT-IV, HYDERABAD 5. D.R. B BENCH, ITAT, HYDERABAD.