Regency Creations Ltd., New Delhi V. ACIT, New Delhi

ITA 1588/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4193 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-05-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 03-05-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 09-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y K AIYAR
• Assessee Lawyers: Y K AIYAR C A SHRI Y K AIYAR
• Section: 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH : F NEW DELHI) (DELHI BENCH : F NEW DELHI) (DELHI BENCH : F NEW DELHI) (DELHI BENCH : F NEW DELHI) BEFORE SHRI G.E. VEERABHADRAPPA, HONBLE VICE PRES IDENT AND BEFORE SHRI G.E. VEERABHADRAPPA, HONBLE VICE PRES IDENT AND BEFORE SHRI G.E. VEERABHADRAPPA, HONBLE VICE PRES IDENT AND BEFORE SHRI G.E. VEERABHADRAPPA, HONBLE VICE PRES IDENT AND SHRI A.D. JAIN, JUDICIAL MEMMBER SHRI A.D. JAIN, JUDICIAL MEMMBER SHRI A.D. JAIN, JUDICIAL MEMMBER SHRI A.D. JAIN, JUDICIAL MEMMBER I.T.A. NO.1588/DEL./2010 I.T.A. NO.1588/DEL./2010 I.T.A. NO.1588/DEL./2010 I.T.A. NO.1588/DEL./2010 (ASSESSMENT YEAR : 2007 (ASSESSMENT YEAR : 2007 (ASSESSMENT YEAR : 2007 (ASSESSMENT YEAR : 2007- -- -08) 08) 08) 08) REGENCY CREATIONS LTD., REGENCY CREATIONS LTD., REGENCY CREATIONS LTD., REGENCY CREATIONS LTD., VS. VS. VS. VS. ACIT, CIR ACIT, CIR ACIT, CIR ACIT, CIRCLE 15(1), CLE 15(1), CLE 15(1), CLE 15(1), A AA A- -- -106, 2 106, 2 106, 2 106, 2 ND NDND ND FLOOR, LAJPAT NAGAR, FLOOR, LAJPAT NAGAR, FLOOR, LAJPAT NAGAR, FLOOR, LAJPAT NAGAR, NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. NEW DELHI. (PAN/GIR NO. : AAACR4380D) (PAN/GIR NO. : AAACR4380D) (PAN/GIR NO. : AAACR4380D) (PAN/GIR NO. : AAACR4380D) (APPELLANT) (APPELLANT) (APPELLANT) (APPELLANT) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) ASSESSEE BY : SHRI Y.K. AIYAR, C.A. ASSESSEE BY : SHRI Y.K. AIYAR, C.A. ASSESSEE BY : SHRI Y.K. AIYAR, C.A. ASSESSEE BY : SHRI Y.K. AIYAR, C.A. REVENUE BY : SHRI S. MOHANTY, SR.DR REVENUE BY : SHRI S. MOHANTY, SR.DR REVENUE BY : SHRI S. MOHANTY, SR.DR REVENUE BY : SHRI S. MOHANTY, SR.DR ORDER ORDER ORDER ORDER PER A.D. JAIN, JM THIS IS ASSESSEES APPEAL FOR ASSESSMENT YEAR 2007-08 CONTENDING THAT THE CIT(A) HAS ERRED IN NOT ADMITTI NG THE LAWFUL CLAIM OF `90,92,721 ELIGIBLE FOR THE ASSESSEE U/S 10B OF THE I .T. ACT, WHICH FACT WAS ADMITTED BY THE CIT(A) AND THE TRIBUNAL IN THE PAST AS THE ASSESSEE HAS FULFILLED ALL THE CONDITIONS PROVIDED IN THE SAID SECTION 10B OF THE I.T. ACT. 2. THE ASSESSEE IS A 100% EO UNIT ENGAGED IN THE EXPORT OF HANDICRAFTS AND COMPUTER SOFTWARE APPROVED UNDER THE STPI SCHEME. THE ASSESSEE CLAIMED `90,92,721 FOR DEDUCTION U/S 10B OF THE ACT. THE AO, HOWEVER, MADE DISALLOWANCE THEREOF, ON THE BASIS O F CBDT CLARIFICATION, VIDE DOF NO.178/30/09-I.T.A.(1) DATE D 6.5.09, WHEREIN IT HAS BEEN CLARIFIED THAT EXEMPTION IN RESPECT OF A UNI T SET UP IN SOFTWARE TECHNOLOGY PARK IS GRANTED TO A UNIT APPROV ED U/S 10A OF THE ACT AND NOT U/S 10B OF THE ACT; AND THAT THEREFORE, IF A UNIT IS APPROVED BY THE DIRECTOR(IT) UNDER THE SOFTWARE TECHNOLOGY P ARK SCHEME, IT WILL BE ALLOWED EXEMPTION U/S 10A OF THE ACT AS A STPI UNI T AND NOT U/S 10B AS A 100% EOU. I.T.A. NO.1588/DEL./2010 (A.Y. : 2007-08) 2 3. BY VIRTUE OF THE IMPUGNED ORDER, THE CIT(A) UPHE LD THE DISALLOWANCE. 4. AGGRIEVED, THE ASSESSEE IS IN APPEAL. 5. CHALLENGING THE IMPUGNED ORDER, THE LD.COUNSEL FO R THE ASSESSEE CONTENDED THAT THE ISSUE STANDS DECIDED IN FAVOUR OF TH E ASSESSEE BY THE TRIBUNALS ORDER DATED 13.4.07 PASSED IN I.T.A. NO .4006/DEL./06 (COPY PLACED ON RECORD) IN THE ASSESSEES OWN CASE FOR ASSE SSMENT YEAR 2003-04 AND BY TRIBUNAL ORDER DATED 11.4.08 IN I.T.A.NO.4296/DEL./07(COPY PLACED ON RECORD) FOR ASSE SSMENT YEAR 2004-05, IN THE APPEALS FILED BY THE DEPARTMENT FOR BOTH THESE YEARS. IT HAS BEEN CONTENDED THAT THOUGH AS PER THE CBDT CLARIFICATION(SUPRA), SECTION 10A OF THE ACT IS APPLIC ABLE TO THE ASSESSEE AND NOT SECTION 10B OF THE ACT, AS CLAIMED, THIS CLARI FICATION IS OPPOSED TO EXHIBIT NO.62, PRESS NOTE NO.5(1997 SERIES) (COPY P LACED AT PAGES 21-22 OF THE ASSESSEES PAPER BOOK) AND EXHIBIT NO.38, P RESS NOTE NO.2 (1993 SERIES) (COPY PLACED AT PAGE 23 OF THE ASSE SSEES PAPER BOOK). FURTHER, RELIANCE HAS ALSO BEEN PLACED ON F.N O.9/6/2001-EOU, ISSUED BY THE CPIO AND DIRECTOR, MINISTRY OF COMMERCE AND INDUSTRY, DEPARTMENT OF COMMERCE, EOU DIVISION DATED 31.3.2011 (COPY PLACED ON RECORD). 6. LD.DR., ON THE OTHER HAND, HAS STRONGLY RELIED ON THE IMPUGNED ORDER. IT HAS BEEN CONTENDED THAT UNDISPUTEDLY, THE C BDT CLARIFICATION(SUPRA) HAS BEEN ISSUED AFTER THE PASSING OF THE TRIBUNAL ORDERS(SUPRA) IN THE ASSESSEES OWN CASE FOR ASSESSMENT YEARS 20 03- 04 AND 04-05. 7. WE HAVE HEARD BOTH THE PARTIES AND HAVE PERUSED TH E MATERIAL ON RECORD. NO DOUBT, THE CBDT CLARIFICATION(SUPRA) STATES THAT EXEMPTION IN RESPECT OF A UNIT SET UP IN SOFTWARE TEC HNOLOGY PARK IS GRANTED TO A UNIT APPROVED U/S 10A OF THE ACT AND NO T U/S 10B THEREOF. HOWEVER, THE PRESS NOTES 5 & 2(SUPRA) ARE TO THE CONTRA RY. PRESS NOTE I.T.A. NO.1588/DEL./2010 (A.Y. : 2007-08) 3 NO.5(1997 SERIES) WAS ISSUED ON 21.5.97 BY THE DEPUTY S ECRETARY TO THE GOVT. OF INDIA, WHEREAS PRESS NOTE NO.2(1993 SERIE S), WAS ISSUED ON 9.3.93 BY THE DEPUTY ECONOMIC ADVISER. FURTHER, VIDE THE AFORESAID COMMUNICATION DATED 31.3.2011, IT HAS BEEN STATED BY THE CPIO AND DIRECTOR UNDER THE RTI, AS FOLLOWS: SUBJECT: RTI APPLICATION RECEIVED FROM SHRI MAHESH SHRIVASTAVA, KESHAVPURAM, DELHI, REGARDING APPROVAL OR RATIFICATION OF STPI, APPROVAL BY BOA FORMED BY MOC TO CLAIM BENEFITS OF 100% EOU SCHEME. PLEASE REFER TO YOUR RTI APPLICATION DATED MARCH 10, 2011 RECEIVED ON 17.03.2011) ON THE SUBJECT MENTIONED ABO VE AND TO INFORM THAT NO APPROVAL/RATIFICATION OF STPI APPROV AL IS REQUIRED FROM BOA FORMED BY MINISTRY OF COMMERCE BY POWER CON FERRED UNDER SECTION 14 OF IDR ACT, 1951. INTER-MINISTERIAL STANDING COMMITTEE FOR EHTPS AND ESTPS (IMSC) IS COMPETENT IN G RANT APPROVAL FOR STPI UNIT TO CLAIM ALL BENEFITS UNDER 1 00% EOU SCHEME AS PER PRESS NOTE 2 OF 1993 (COPY ENCLOSED). 8. IN VIEW OF THE ABOVE, WE FIND THE GRIEVANCE OF T HE ASSESSEE TO BE JUSTIFIED AND IT IS ACCEPTED AS SUCH. WE HOLD THAT THE ASSESSEE IS ENTITLED TO CLAIM OF DEDUCTION U/S 10B OF THE ACT. 9. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 03.05.2011. SD/- SD/- (G.E. VEERABHADRAPPA) (A.D. JAIN) VICE PRESIDENT JUDICIAL MEMBER DATED: MAY 05, 2011. *SKB* COPY FORWARDED TO:- 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT 4. THE CIT(A)-XVIII, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DELHI. AR/ITAT I.T.A. NO.1588/DEL./2010 (A.Y. : 2007-08) 4