Deputy Commissioner Of Income Tax, Circle 6(1)(2), Bengaluru V. M/s. Societe Generale Global Solution Centre Pvt. Ltd., Bengaluru

ITA 514/BANG/2017

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 7098 (ITAT-BANGALORE)
• Duration Of Justice: 9 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-12-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: misc
• Appeal Filed On: 02-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

I N THE I NC O M E T A X APP ELL A TE T R I B UNA L, B AN G A L O R E BE NC H A BE F O R E SH R I J A SON P BO A Z , ACC O U N T AN T M E M BER AND SHRI LALIT KUMAR JUDICIAL MEMBER I T A N O . 5 1 4 / BA NG / 20 1 7 ( A SST . Y EAR 2 00 8 - 09 ) T H E D Y . C O MM ISS ION ER O F I N C O M E - T A X , C I R C L E 6 ( 1 ) ( 2 ), BE N G A LU R U . .......... A PP E L L A N T V S . M / S S OCIETE GENERALE GLOBAL SOLUTION CENTRE PVT. LTD., 10 TH FLOOR, VOYAGER BUILDING, ASCENDAS ITPB SEZ, INTERNATIONAL TECH PARK, WHITE FIELD, BENGALURU - 5 60 066 . ............R E S PO N D E N T C.O. NO.90/BANG/2017 (IN ITA NO.514/BANG/2017) (BY ASSESSEE) A PP E L L A N T B Y : S H RI B.R. RAMESH, J CIT RE S P ON D E N T /C.O. B Y : S H RI ROHIT JAIN , C.A D A T E O F H E A R I N G : 7 - 1 2 - 2 0 1 7 D A T E O F P R O N OU N CE M E N T : 13 - 12 - 2 0 1 7 O R D E R P ER SH R I J A SON P BO A Z , ACC O U N T AN T M E M BER : T H I S A P P E A L B Y RE V E N U E I S D I R E C T E D A G A I N S T T H E O R D E R O F T H E CI T ( A ) - 6 , B A NG A L O RE D A T ED 2 5 . 1 0 . 2 0 1 6 F O R A SS E SS M E N T Y EAR 2 00 8 - 0 9 . THE ASSESSEE HAS ALSO PREFERRED CROSS OBJECTION S IN THE MATTER. 2 . BR I E F L Y ST A T E D , T H E F A C T S O F T H E C A S E A R E AS U N D ER : - 2 ITA NO.514/BANG/2017 & C.O. NO.90/BANG/2017 2 .1 T H E A S S E S S EE, A C O M P A N Y E NG A G E D I N T H E B US IN E S S O F P R OV I DIN G SOFTWARE DEVELOPMENT SERVICES, AND IT E N A B L ED S E R V I C E S ( I T ES), F I L E D IT S R E T U RN O F I N C O M E F O R A SS E S S M E N T Y EAR 2 0 0 8 - 0 9 O N 30.09. 2 0 0 8 D EC L A R I N G TO T AL I N C O M E O F R S . 1,46,96,077 A F T E R, I NT E R A L I A, C L A I M I N G D E D U C TI O N U/ S . 1 0 A O F T H E I N C O M E T AX A C T , 1 96 1 ( I N S HO R T T H E A C T ) T O T H E T U N E O F R S . 29,08,55,171 / - . T H E C A S E W A S T A K E N U P F O R S C R U TI N Y A N D TH E A S S E S S M E N T W AS C O M PL E T E D U / S . 14 3 ( 3 ) O F TH E A C T V I D E O R D ER D A T E D 21.12.2011 W H ER E I N T H E A SS E S S EE S IN C O M E W AS D E T ER M IN E D A T R S . 3,30,41,389 / - I N VI EW O F, I NT E R A L I A, TH E A S S E S S IN G O F F I CER ( A O ) D I S A L L O WIN G T H E A S S E S S EE S E X C E S S C L A I M F O R D E D U C T IO N U / S . 1 0 A O F T H E A CT T O T H E E XT E N T O F R S . 1,83,45,312 / - . O N A P P E A L , T H E C I T ( A ) - 6 , BA N G A LO R E P A R T L Y A L L O W ED T H E A SS E S S EE S A P P E A L VI D E O R D ER D A T ED 25.10.2016 . I N D O IN G S O , T H E L D . CI T ( A ) A L L O W E D T H E A S S E S S EE S C L A I M F O R D E D U C T IO N U/ S . 1 0 A O F T H E A CT F O LL O WI N G T H E D E C I S IO N O F T H E H ON B L E K A R N A T A K A H I G H C O U RT I N T H E C A S E O F CIT V T A T A EL X S I L T D . ( 3 4 9 I T R 98 ) ( K A R ). 3 .1 A GG R I E V E D B Y TH E O R D ER O F T H E CI T ( A ) - 6 , BA N G A L O RE D A T E D 2 5 . 1 0 . 2 0 1 6 F O R AS S E SS M E N T Y EAR 2 00 9 - 1 0 , RE V E N U E H AS F I L E D T H I S A P P E A L , RA I S IN G T H E F O L LO W I N G G R OU N D S : - 1 .T H E O R D E R O F T H E CIT ( A PP E A LS ) I S OPP OS E D T O L A W AN D TH E F A C T S AN D C I R C U MS T A N C E S O F T H E C A S E. 3 ITA NO.514/BANG/2017 & C.O. NO.90/BANG/2017 2 . O N T H E F A C T S A N D I N C I R C U M S T A N CES O F TH E C A S E, T H E CIT( A ) E R R ED I N C I T IN G T H E R A T I O L A I D D O W N B Y T H E HO N ' B L E H I G H C OU R T I N T H E C A S E O F C IT V S T A T A E L X S I L T D . R E P O R T E D I N 34 9 ITR 9 8 A N D D IR E C T I N G T H E A O T O R E D U CE E X P E N S E S IN C U R R ED I N FO R E IG N C U R R E N CY, BO T H F R O M E X P O R T T U R N O V ER A S W E L L A S FR O M T O T A L T U RN O V E R F O R T H E P U RP O S E O F C O MPU T A T IO N O F D E D U C T IO N U / S 1 0 A , W I T HO U T A P P R EC IA T IN G TH E F A CT T HA T T H E S T A TU T E AL LO W S EX C L U SI O N O F SU C H EX P E N D I T U R E O NL Y F RO M E X P OR T T U RN O V E R B Y W A Y O F A SP E C I F I C D E F I NI T I O N F O R E X P O R T T UR NO V ER I N T H E A C T . O N TH E O T H E R H AN D , T H E R E I S N O S P E C I FI C P R O V I S I O N I N S E C T IO N 1 0 A W A RR A NT I N G E X C L U S IO N O F T H E AB O VE E X P E N S ES FR O M T H E T O TA L T U R N O V ER A L SO . 3 . F O R T H E S E A N D S U CH O T H E R G R OU N D S TH A T M A Y B E U R G ED A T TH E TI M E O F H E A R IN G , I T I S HU M BL Y P R A Y E D TH A T T H E O R D E R O F TH E CIT( A ) I N S O FA R A S I T R E L A T ES T O T H E A B O VE G R OU N D S M A Y B E R EV E R S E D A N D T HA T O F T H E A SS E SS I N G O F F I C E R B E R E ST OR E D . 4 . T H E A PP E L L AN T C RA VES L E A VE T O AD D , AL T E R , A M E N D O R D E L E T E AN Y O F T H E GR O U N D S T H A T M A Y B E UR G E D A T T H E T I M E O F H E A R I N G O F TH E A PP E AL . 3.2 T H E L D . D R W AS H E ARD I N S U P P O R T O F T H E G R O U ND S RA I S E D . 4 ITA NO.514/BANG/2017 & C.O. NO.90/BANG/2017 3 . 3 W E H A V E H EA R D TH E R I V AL C ON T E N T I ON S A N D P E R US E D A N D CA R EF ULL Y C O N S I D ER E D T H E M A T E R I A L O N RE C O R D ; IN C L U D I N G TH E J U D I C I A L P R ON O U N C E M E N T C I T E D . A S R E G A R D S T H E I S SU E O F R E D U C T IO N O F T H E IT E M S O F E X P E N DI TU R E I N C U RR E D I N F O R E I G N C U RR E N CY S U C H A S T E L EC O M M UNI C A T IO N C H A R G E S , P R O F E S S IO N A L A N D C O N SU LT A T I O N FEE S , T R A V E LL I N G A N D C ON V E Y A N CE E X P E N S E S E T C.; W HI C H A R E A T T R I BU T A B L E T O TH E D E LI V ERY O F S O F T W A R E O U T S I D E I ND I A A N D I N R E N D ER IN G O F T E C H N I C A L S E R VI C ES O U TS ID E I N DI A, T H E J U R I S D I C T I O N AL H I G H C O U RT O F K A R N A T A K A I N TH E C A S E O F CIT V T A T A EL X S I L T D ( 3 4 9 I T R 98 ) ( K AR) H AS H E L D T H A T W H EN CE R T A I N E X P E NS ES ARE E X C LU D ED F R O M TH E E X P O R T T U R NO V ER F O R TH E PU R P O S ES O F C O M PU TI N G D E DU C T I O N A D M ISS I BL E U N D E R T H E A C T ; L I K E U / S . 10 A O F T H E A C T , S U C H E X P E N S ES ARE A L S O T O B E E X C L U D ED F R O M TO T AL TU R N O V ER, A S E X P O RT TU R N O V ER I S A P A R T O F T O T AL T U R NO V ER. T H E D EC I S IO N I N TH E C A S E O F T A T A EL X S I LT D ( S U P R A ) H AS A L S O B E E N F O LL O W ED B Y T H E H ON B L E C O U RT I N IT S O R D ER I N T H E C A S E O F D CIT V M O T O R I ND U ST R I E S C O . L TD ., (I T A N O . 7 7 6 /2 0 0 6 , 7 4 4/ 2 00 7 A N D 1 1 55 / 20 0 6 D A T ED 13 . 0 6 . 2 0 1 4 ), H OL D I N G T H AT I F A N Y E X P E N D IT U RE I S S O UG H T T O B E RE M OV ED F R O M E X PO R T TU R N O V ER, TH E N I T S HO U L D A L S O B E R E D U C E D FR O M TO T AL T U R N O V ER F O R T H E PU R P O S ES O F C O M PU TI N G TH E E L I G I B L E D E D U C T I O N U / S . 1 0 A O F T H E A C T . IN T H I S L E G A L A N D F A C T U A L M A T R I X O F T H E CA S E, A S D I S C U S S ED A B O V E, W E F I N D N O RE A S O N T O I N T ERFERE W I T H O R D E V I A T E FR O M T H E F IN D I N G R E N D ER E D B Y T H E LD . CI T ( A ) O N TH I S IS SU E, A N D TH ER EF O RE U PH O L D T H E S A M E . C O NS E Q U E N T L Y , TH E G R O UN D S S. NO S . 1 T O 4 R A IS E D B Y RE V E N U E A R E D I S M ISS E D . 5 ITA NO.514/BANG/2017 & C.O. NO.90/BANG/2017 4 . 1 IN ITS CROSS OBJECTIONS (C.O.), THE ASSESSEE HAS RAISED THE FOLLOWING GROUND : - 1. ADJUSTMENTS MADE TO THE EXPORT TURNOVER WHILE COMPUTING DEDUCTION UNDER SECTION 10A OF INCOME TAX ACT, 1961 ( THE ACT ). 1.1 THE LD. CIT(APPEALS) ERRED IN NOT HOLDING THAT NO EXPENDITURE SHOULD BE REDUCED FROM THE EXPORT TURNOVER , WHILE COMPUTING THE DEDUCTION U/S.10A OF THE ACT. 4.2 AS REVENUE S APPEAL ON THE ASSESSEE S CLAIM FO R DEDUCTION U/S.10A OF THE ACT IS DISMISSED AND THE ASSESSEE S C.O. IS ONLY AN ALTERNATE GROUND RAISED ON THE DEDUCTION U/S.10A OF THE ACT, WHICH HAS ALREADY BEEN DECIDED, THERE IS NO REQUIREMENT FOR ADJUDICATION OF THE C.O., WHICH IS ACCORDIN GLY DISMISSED. 5. IN T H E R E S U L T , R E V E NU E S A P P E A L F O R AS S E S S M E N T Y E A R 2 00 9 - 1 0 AND THE ASSESSEE S CROSS OBJECTIONS ARE BOTH D I S M ISS E D . O R D ER P R O N OU N C E D I N TH E O P EN C O U RT O N 13TH DEC . , 20 17 . SD/ - SD/ - ( LALIT KUMAR ) ( J A SON P BO A Z ) J UD I C I A L M E M B ER A C C O UN T AN T M E M BER BA N G A LO R E D A T ED : 13 /1 2 /2 0 1 7 * REDDY GP C O P Y T O :1 . T H E A SS E SS E E 2 . T H E RE V E N U E 3 . T H E CIT C O N CE R N E D . 4 . T H E CI T ( A ) C ON CER N E D . 5 . D R 6 . G F B Y O R D ER S R . P R I V A T E S EC R E T A R Y , I T AT, B A N G A L O R E