DCIT, CHENNAI V. Classic Linens Internatiional P. Ltd., CHENNAI

ITA 2010/CHNY/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 96315 (ITAT-CHENNAI)
• Duration Of Justice: 1 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-11-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 18-09-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR U ANJANEYULU IRS

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI , ! , ' #$ BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER & SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER ./ I.T.A. NO.2010/MDS/2015 ( / ASSESSMENT YEAR : 2010 -2011) THE DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE I(2) CHENNAI 600 034. ( %& /APPELLANT) VS M/S. CLASSIC LINENS INTERNATIONAL P. LTD UNIT NO.13 & 14, SDF-III, PHASE II, MEPZ, TAMBARAM, CHENNAI 600 045. [PAN: AABCC 3510F] ( !'%& /RESPONDENT) / APPELLANT BY : DR. U. ANJANEYULU, IRS, CIT. / RESPONDENT BY : NONE /DATE OF HEARING : 11.11.2015 ! /DATE OF PRONOUNCEMENT : 11.11.2015 ( / O R D E R PER CHANDRA POOJARI, ACCOUNTANT MEMBER THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-1, CHENNAI DA TED 13.07.2015 FOR THE ASSESSMENT YEAR 2010-2011. I.T.A.NO.2010/MDS/2015 :- 2 -: 2. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS:- 2.1 THE LEARNED CIT(A) ERRED IN DIRECTING THE ASS ESSING OFFICER TO RECOMPUTED THE DEDUCTION U/S.10B BY EXCL UDING THE FREIGHT EXPENDITURE BOTH FROM THE EXPORT TURNOVER A ND FROM THE TOTAL TURNOVER FOR COMPUTATION OF DEDUCTION U/S.10B . 2.2 THE LEARNED CIT(A) OUGHT TO HAVE APPRECIATED TH E FACT THAT THE DECISION OF THE SPECIAL BENCH OF THE TRIBU NAL IN THE CASE OF SAK SOFT LTD 121 TTJ 865 RELIED ON BY HIM H AS NOT BEEN ACCEPTED BY THE DEPARTMENT AND HAS BEEN CONTESTED B EFORE THE HIGH FORUM. 3. THE FACTS OF THE CASE ARE THAT THE ASSESSEE INCURRE D EXPENDITURE ON FREIGHT CHARGES WHICH ARE EXCLUDED FROM THE EXPO RT TURNOVER BUT NOT EXCLUDED FROM TOTAL TURNOVER. ACCORDING TO THE ASSESSING OFFICER THE EXPENDITURE SHOULD BE EXCLUDED FROM EXPORT TURN OVER WHILE WORKING OUT THE DEDUCTION U/S.10A OF THE ACT. THE ASSESSEE CARRIED THE APPEAL BEFORE THE COMMISSIONER OF INCOME TAX (A PPEALS). 4. THE COMMISSIONER OF INCOME TAX (APPEALS) PLACING RE LIANCE ON THE ORDER OF THE SPECIAL BENCH IN THE CASE OF M /S. SAKSOFT LTD 121 TTJ 865 (SB ) HELD THAT ON THE BASIS OF PARITY PRINCIPLES, WHAT EVER HAS BEEN EXCLUDED FROM EXPORT TURNOVER SHALL ALSO BE EXCLUDE D FROM TOTAL TURNOVER. ACCORDINGLY, THE COMMISSIONER OF INCOME T AX (APPEALS) DIRECTED THE ASSESSING OFFICER TO EXCLUDE THIS COMP ONENT OF FREIGHT FROM EXPORT TURNOVER AS WELL AS TOTAL TURNOVER WHIL E COMPUTING DEDUCTION U/S.10A OF THE ACT. AGAINST THIS, THE REV ENUE IS IN APPEAL BEFORE US. I.T.A.NO.2010/MDS/2015 :- 3 -: 5. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MATERI AL ON RECORD. ADMITTEDLY, THIS ISSUE WAS CONSIDERED BY T HE SPECIAL BENCH IN THE CASE OF M/S. SAKSOFT LTD (CITED SUPRA) WHEREIN IT WAS HELD THAT EXPENDITURE ON FREIGHT SHOULD BE EXCLUDED FROM THE EXPORT TURNOVER AS WELL AS TOTAL TURNOVER WHILE COMPUTING DEDUCTION U/ S.10A OF THE ACT. BEING SO, IN OUR OPINION THE IMPUGNED ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) IS CONFIRMED. THE APPEAL OF TH E REVENUE IS DISMISSED. 6. IN RESULT, THE APPEAL OF THE REVENUE IN ITA NO.2010/MDS/2015 IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF H EARING ON WEDNESDAY, THE 11 TH OF NOVEMBER, 2015, AT CHENNAI. SD/- SD/- ( ! ) (CHALLA NAGENDRA PRASAD) ' / JUDICIAL MEMBER ( ) (CHANDRA POOJARI) / ACCOUNTANT MEMBER '# /CHENNAI. $% /DATED:11.11.2015. KV %& '( )( /COPY TO: 1. * APPELLANT 2. / RESPONDENT 3. + ( )/CIT(A) 4. + /CIT 5. (,- . /DR 6. -/ 0 /GF. I.T.A.NO.2010/MDS/2015 :- 4 -: