Redrock IT Solutions India Private Limited, Hyderabad V. Income Tax Officer, Ward-3(2), Hyderabad

ITA 1521/Hyd/2019

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 7097 (ITAT-HYDERABAD)
• Duration Of Justice: 1 year(s) 5 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-04-2021
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: SMC
• Next Hearing Date: 09-03-2021
• Assessment Year: 2009-2010
• Appeal Filed On: 09-10-2019
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Assessee Lawyers: P VINOD
• Section: 143(3); 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH SMC , HYDERABAD (THROUGH VIRTUAL HEARING) BEFORE SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO. 1521/HYD/2019 A.Y. 2009 - 10 REDROCK IT SOLUTIONS INDIA PRIVATE LIMITED, HYDERABAD. PAN: AADCR 3796 E VS. INCOME TAX OFFICER, WARD - 3(2), HYDERABAD. (APPELLANT) (RESPONDENT) ASSESSEE BY: SHRI P. VINOD REVENUE BY: SHRI SANJEEV BHAGAT, DR DATE OF HEARING: 09 /03/2021 DATE OF PRONOUNCEMENT: 07 /04/2021 ORDER PER A. MOHAN ALANKAMONY, AM.: THIS APPEAL IS FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT (A) - 3 , HYDERABAD IN APPEAL NO. 1049/CIT(A) - 3/2014 - 15, DATED 09/08/2019 PASSED U/S. 143(3) R.W.S 250(6) OF THE ACT FOR THE AY: 20 09 - 10 . 2. THE ASSESSEE HAS RAISED THREE GROUNDS IN ITS APPEAL AND THEY ARE EXTRACTED HEREIN BELOW FOR REFERENCE: - 1. THE ORDER OF THE LD. CIT(A) DISMISSING THE APPEAL IS ERRONEOUS BOTH ON FACTS AND IN LAW. 2. THE LD. CIT(A) ERRED IN DISMISSING THE APPEAL WITHOUT PROPER OPPORTUNITY. THE LD. CIT(A) FAILED TO APPRECIATE THAT THE APPELLANT HAS NOT RECEIVED THE NOTICE OF THE A.O. IN THE REMAND 2 PROCEEDINGS AND THEREFORE OUGHT TO HAVE DIRECTED THE A.O. TO PROVIDE ONE MORE OPPORTUNITY FOR VERIFICATION. 3. THE LD. CIT(A) ERRED IN UPHOLDING THE DISALLOWANCE MADE BY THE A.O. U/S. 10B. THE LD. CIT(A) FAILED TO APPRECIATE THE CLARIFICATION BY THE STPI THAT THERE IS NO PRACTICE OF RATIFICATION NOW AND OUGHT TO H AVE ALLOWED THE DEDUCTION U/S. 10B. 4. THE LD. CIT(A) ERRED IN NOT APPRECIATING THE ALTERNATE CLAIM OF DEDUCTION U/S. 10A WHICH WAS DULY SUPPORTED BY REPORT OF CHARTERED ACCOUNTANT IN FORM NO. 56F. 3. BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY IS ENGAGED IN THE BUSINESS OF SOFTWARE SERVICES, FILED ITS RETURN OF INCOME FOR THE A.Y. 2009 - 10 ON 11/09/2009 DECLARING TOTAL INCOME OF RS. 1,760/ - AFTER CLAIMING EXEMPTION OF RS. 28,58,812/ - U/S. 10B OF THE ACT. DURING THE ASSESSMENT PROCEEDINGS, THE A SSESSEE WAS ASKED TO SUBSTANTIATE ITS CLAIM OF DEDUCTION U/S. 10B WITH NECESSARY DOCUMENTARY EVIDENC E. IN REPLY, THE ASSESSEE COMPANY HAD SUBMITTED THE DOCUMENTS BEFORE THE LD. A.O. BUT THE LD. A.O WAS NOT SATISF IED WITH THE EXPLANATIONS GIVEN BY THE ASSES SEE AND THEREFORE DENIED THE CLAIM OF DEDUCTION U/S. 10B OF THE ACT. ACCORDINGLY, THE TOTAL INCOME OF THE ASSESSEE WAS DETERMINED AT RS. 28,60,572/ - . ON APPEAL, THE LD. CIT(A) CALLED FOR REMAND REPORT FROM THE LD. A.O. AFTER EXAMINING THE LD. A.O.S REMAND REPORT AND CONSIDERING THE MATERIAL ON RECORD, THE LD. CIT(A) DISMISS ED THE ASSESSEES APPEAL BY HOLDING THAT THE ASSESSEE COULD NOT SUBSTANTIATE ITS CLAIM OF DEDUCTION WITH NECESSARY DOCUMENTARY EVIDENCE. AGGRIEVED, THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 3 4. BEFORE ME, AT THE OUTSET, LD. AR SUBMITTED THAT DURING THE ASSESSMENT PROCEEDINGS, THOUGH ALL THE NECESSARY DOCUMENTARY EVIDENCE WAS PRODUCED BY THE ASSESSEE BEFORE THE LD. A.O AS REQUIRED BY HIM , WITHOUT EXAMIN ING THE SAME HE DISALLOWED THE CLAIM OF DEDUCTION. ON APPEAL, THE LD. CIT(A) CALLED FOR A REMAND REPORT FROM THE LD. A.O. HOWEVER , IN THE REMAND PROCEEDINGS THE ASSESSEE COULD NOT APPEAR AS THE NOTICE WAS NOT RECEIVED BY THE ASSESSEE. LD. AR FURTHER SUBMITTED THAT LD. CIT(A) I GNOR ED THE ASSESSEES SUBMISSIONS IN THIS REGARD AND PASSED ORDER WITHOUT PROVIDING PROPER OPPORTUNITY TO THE ASSESSEE OF BEING HEARD . IT WAS THEREFORE PLEADED THAT THE ASSESSEE MAY BE PROVIDED WITH ONE MORE OPPORTUNITY TO PURS UE HIS CASE BEFORE THE LD. CIT(A) . LD. DR ON THE OTHER HAND OBJECTED TO THE SUBMISSIONS OF THE LD. AR AND ARGUED THAT SUFFICIENT OPPORTUNITIES HAD BEEN PROVIDED TO THE ASSESSEE, HOWEVER, THE ASSESSEE COULD NOT SUBSTANTIATE I TS CLAIM OF DEDUCTION U/S. 10B OF THE ACT BEFORE THE LD. REVENUE AUTHORITIES . LD. DR FURTHER SUBMITTED THAT EVEN BEFORE THE LD. A.O THOUGH THE ASSESSEE WAS PROVIDED WITH SUFFICIENT OPPORTUNITY TO SUBSTANTIATE ITS CASE, HOWEVER THE ASSESSEE FAILED TO ADDUCE PROPER EVIDENCE TO SUBSTANTIA TE ITS CLAIM . UNDER THESE CIRCUMSTANCES, THE LD. REVENUE AUTHORITIES HAD NO OTHER OPTION BUT TO PASS ORDER S BASED ON THE MATERIALS AVAILABLE ON RECORD. HENCE, IT WAS PLEADED THAT THE ORDERS PASSED BY THE LD. REVENUE AUTHORITIES DO NOT CALL FOR ANY INTERFERENCE AND APPEAL OF THE ASSESSEE MAY BE DISMISSED. 4 5 . I HAVE HEARD THE RIVAL SUBMISSIONS AND CAREFULLY PER USED THE MATERIALS ON RECORD. ON EXAMINING THE FACTS OF THE CASE, I FIND MERIT IN THE SUBMISSIONS OF THE LD. DR. THE LD. REVENUE AUTHORITIES HAD PROVIDED SUFFICIENT OPPORTUNITIES TO THE ASSESSEE TO SUBSTANTIATE ITS CLAIM OF DEDUCTION U/S.10B OF THE ACT WI TH PROPER DOCUMENTARY EVIDENCE . HOWEVER, THE ASSESSEE FAILED TO PRODUCE COGENT EVIDENCE BEFORE THE LD. REVENUE AUTHORITIES . HENCE, THE LD. REVENUE AUTHORITIES WERE LEFT WITH NO OTHER OPTION EXCEPT TO PASS ORDER S BASED ON THE MATERIAL AVAILABLE ON RECORD. F URTHER O N EXAMINING THE LD. CIT(A)S ORDER, I FIND THAT THOUGH THE LD. CIT(A) HAD CALLED FOR REMAND REPORT FROM THE LD.AO I T APPEARS THAT THE ASSESSEE C OULD NOT APPEAR BEFORE THE LD.AO DURING THE REMAND PROCEEDINGS AS IT DID NOT RECEIVE THE NOTICE . UNDER T HESE CIRCUMSTANCES, CONSIDERING THE PRAYER AND THE SUBMISSIONS OF THE LD. AR AND THE NATURE OF ISSUES INVOLVED IN THE APPEAL, IN THE INTEREST OF JUSTICE, I HEREBY REMIT THE MATTER BACK TO THE FILE OF LD. CIT(A) FOR DE - NOVO CONSIDERATION THEREBY PROVIDING ONE MORE OPPORTUNITY TO THE ASSESSEE OF BEING HEARD. AT THE SAME BREATH, I ALSO HEREBY CAUTION THE ASSESSEE TO PROMPTLY CO - OPERATE BEFORE THE LD. CIT(A) IN THE PROCEEDINGS FAILING WHICH THE LD. CIT(A) SHALL BE AT LI BERTY TO PASS APPROPRIATE ORDER IN ACCORDANCE WITH LAW AND MERITS BASED ON THE MATERIALS ON THE RECORD. IT IS ORDERED ACCORDINGLY. 5 6 . IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE IS ALLOWED FOR STATISTICAL PURPOSES AS INDICATED HEREINABOVE. PRONOUNC ED IN THE OPEN COURT ON THE 07 TH APRIL, 2021. SD/ - ( A. MOHAN ALANKAMONY ) ACCOUNTANT MEMBER HYDERABAD, DATED: 07 TH APRIL, 2021. OKK COPY TO: - 1) REDROCK IT SOLUTIONS INDIA PRIVATE LIMITED, FLAT NO.610, 6 TH FLOOR, BABUKHAN ESTATE, BASHEERBAGH, HYDERABAD 500 001. 2) INCOME TAX OFFICER, WARD - 3(2), SIGNATURE TOWERS, OPP. BOTANICAL GARDENS, KONDAPUR, HYDERABAD 500084. 3) THE CIT(A) - 3 , HYDERABAD. 4) THE PRINCIPAL COMMISSIONER OF INCOME TAX - 3 , HYDERABAD. 5) THE DR, ITAT, HYDERABAD 6) GUARD FILE