M/s. Aban Informatics Pvt. Ltd., CHENNAI V. ACIT, CHENNAI

ITA 38/CHNY/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 64614 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 11 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-12-2012
• Appeal Filed By: Assessee
• Bench Allotted: D
• Next Hearing Date: 10-12-2012
• Assessment Year: 2005-2006
• Appeal Filed On: 11-01-2010
• Court: TRIBUNAL
• Department Lawyers: T N BETGIRI
• Assessee Lawyers: D ANAND
• Keywords: Depreciation

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH : CHENNAI [BEFORE SHRI N.S. SAINI, ACCOUNTANT MEMBER AND SHRI VIKAS AWASTHY, JUDICIAL MEMBER] I.T.A.NO.38/MDS/2010 ASSESSMENT YEAR : 2005-06 M/S ABAN INFORMATICS PVT. LTD. JANPRIYA CREST 113, PANTHEON ROAD EGMORE SALEM 600 008 [PAN AACCA4322L] VS THE ACIT COMPANY CIRCLE I(1) CHENNAI (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI D. ANAND RESPONDENT BY : SHRI T.N.BETGIRI DATE OF HEARING : 10-12-2012 DATE OF PRONOUNCEMENT : 11-12-2012 O R D E R PER N.S. SAINI, ACCOUNTANT MEMBER THIS IS AN APPEAL FILED BY THE ASSES SEE AGAINST THE ORDER OF THE CIT(A)-III, CHENNAI, DATED 30.10.2009. 2. THE A.R OF THE ASSESSEE SUBMITTED THAT THE ONLY ISS UE INVOLVED IN THIS APPEAL OF THE ASSESSEE WAS THAT THE CIT(A) ERRED IN CONFIRMING THE ORDER OF THE ASSESSING OFFICER IN NO T ALLOWING DEDUCTION U/S 10A OF THE ACT ON THE GROUND THAT THE TOTAL INC OME COMPUTED AFTER SET OFF OF CARRY FORWARD LOSSES AND DEPRECIATION WA S NIL. I.T.A.NO. 38/2010 :- 2 -: 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE HAD SET UP A STPI UNIT IN FINANCIAL YEAR 2000-01 AND CLAIMED DED UCTION U/S 10A FOR THE FIRST TIME IN THE CURRENT ASSESSMENT YEAR 2005- 06 OF ` 93,80,263/-. THE ASSESSING OFFICER, RELYING ON THE PROVISIONS OF SECTION 10A(6)(II) OF THE ACT, DISALLOWED THE CLAIM OF DEDUCTION U/S 10A ON THE GROUND THAT THE TOTAL INCOME WAS NIL AFTER SETTING OFF OF UNABS ORBED DEPRECIATION AND BUSINESS LOSS FOR ASSESSMENT YEAR 2000-01 TO 20 04-05. 4. ON APPEAL, THE CIT(A) CONFIRMED THE ACTION OF THE A SSESSING OFFICER. 5. BEFORE US, BOTH THE PARTIES AGREED THAT THE ISSUE I S COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE CHEN NAI A BENCH OF THE TRIBUNAL IN THE CASE OF ACIT VS M/S CHANGEPOND TECH NOLOGIES PVT. LTD. IN I.T.A.NO.1169/MDS/2007, ORDER DATED 3.10.2012. W E FIND THAT THE TRIBUNAL IN THE ABOVE CASE, WHILE DECIDING THE ISSU E, HAS HELD AS UNDER: 5. THE SECOND GROUND RAISED BY THE REVENUE IS THA T THE COMMISSIONER OF INCOME-TAX(APPEALS) HAS ERRED IN DI RECTING THE ASSESSING OFFICER TO RE-COMPUTE BUSINESS PROFITS AF TER SETTING OFF BROUGHT FORWARD LOSSES AND DEPRECIATION AND ALLOW D EDUCTION UNDER SEC.10A. 6. IN THE VERY SAME ORDER CITED ABOVE, THE CO-ORDINATE BENCH OF THE TRIBUNAL HAS ALLOWED THE DEDUCTION TO THE ASSES SEE UNDER SEC.10A WITHOUT SETTING OFF OF THE BROUGHT FORWARD LOSSES AND THE ISSUE WAS DECIDED IN FAVOUR OF THE ASSESSEE. THE A BOVE ORDER OF THE CO-ORDINATE BENCH IS IN CONFORMITY TO THE JUDGM ENT OF THE HONBLE KARNATAKA HIGH COURT RENDERED IN THE CASE O F CIT V. YOKOGAWA INDIA LTD. AND OTHERS (246 CTR 226), WHERE IN THE HONBLE KARNATAKA HIGH COURT HAS HELD THAT AS THE D EDUCTION I.T.A.NO. 38/2010 :- 3 -: UNDER SEC.10A HAS TO BE EXCLUDED FROM THE TOTAL INC OME OF THE ASSESSEE, THE QUESTION OF UNABSORBED BUSINESS LOSS BEING SET OFF AGAINST SUCH PROFITS AND GAINS OF THE UNDERTAKING W OULD NOT ARISE. 7. WE, THEREFORE, SET ASIDE THE ORDERS OF THE LOWER A UTHORITIES AND DIRECT THE ASSESSING OFFICER TO ALLOW DEDUCTION U/ S 10A OF THE ACT TO THE ASSESSEE BEFORE SET OFF OF CARRY FORWARD LOSSE S AND DEPRECIATION. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOWED. ORDER PRONOUNCED ON TUESDAY, THE 11 TH OF DECEMBER, 2012, AT CHENNAI. SD/- SD/- (VIKAS AWASTHY) JUDICIAL MEMBER (N.S.SAINI) ACCOUNTANT MEMBER DATED: 11 TH DECEMBER, 2012 RD COPY TO: APPELLANT/RESPONDENT/CIT(A)/CIT/DR