DCIT, CHENNAI V. M/s. Thinksoft Global Services Private Ltd., CHENNAI

ITA 54/CHNY/2010

• Counselvise Citation: 5421714 RSA 2010
• Duration Of Justice: 1 year(s) 7 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 08-09-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 08-09-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 15-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR I V IJAYAKUMAR IRS
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL C BENCH, CHENNAI BEFORE DR. O.K.NARAYANAN, VICE-PRESIDENT AND SHRI HARI OM MARATHA, JUDICIAL MEMBER ITA NOS.54 & 1197(MDS)/2010 ASSESSMENT YEARS: 2002-03 & 2003-04 THE DEPUTY/ASSISTANT COMMISSIONER OF INCOME-TAX COMPANY CIRCLE III(2), CHENNAI. VS. M/S.THINKSOFT GLOBAL SERVICES LTD., TYPE II, NO.5, DR. VSI ESTATE, THIRUVANMIYUR, CHENNAI-41. PAN AABCT0976G. (APPELLANT) (RESPONDENT) APPELLANT BY : DR. I.V IJAYAKUMAR, IRS, CIT-DR. RESPONDENT BY : NONE DATE OF HEARING : 8 TH SEPTEMBER, 2011 DATE OF PRONOUNCEMENT : 8 TH SEPTEMBER, 2011 O R D E R PER DR.O.K.NARAYANAN, VICE-PRESIDENT: THESE TWO APPEALS ARE FILED BY THE REVENUE. THE RELEVANT ASSESSMENT YEARS ARE 2002-03 AND 2003-04. THE APPEALS ARE DIRECTED AGAINST THE ORDERS OF THE COMM ISSIONER OF INCOME-TAX(APPEALS)-III AT BANGALORE DATED 26-2-200 9 AND 25-9- 2009. THE APPEAL FOR THE ASSESSMENT YEAR 2002-03 A RISES OUT OF - - ITA NOS.54 & 1197 OF 2010 2 THE ASSESSMENT COMPLETED UNDER SECTION 143(3) AND T HE APPEAL FOR THE ASSESSMENT YEAR 2003-04 ARISES OUT OF THE A SSESSMENT COMPLETED UNDER SECTION 143(3) READ WITH SECTION 14 7 OF THE INCOME-TAX ACT, 1961. 2. THE ASSESSEE IN THIS CASE HAD CLAIMED THE BENEF IT AVAILABLE UNDER SECTION 10A OF THE ACT. WHILE GRAN TING THE SAID RELIEF THE ASSESSING AUTHORITY HAD EXCLUDED ITEMS L IKE CONNECTIVITY CHARGES, INTERNET CHARGES AND EXPENSES INCURRED IN FOREIGN CURRENCY FROM THE EXPORT TURNOVER, BUT NO C ORRESPONDING REDUCTION WAS MADE FROM THE TOTAL TURNOVER. 3. IN FIRST APPEALS THE COMMISSIONER OF INCOME- TAX(APPEALS) HELD THAT WHEN CERTAIN ITEMS ARE DEDUC TED FROM THE EXPORT TURNOVER, CORRESPONDING DEDUCTIONS MUST BE M ADE FROM THE TOTAL TURNOVER AS WELL. HE DIRECTED THE ASSESS ING AUTHORITY ACCORDINGLY. 4. THE REVENUE IS AGGRIEVED AND, THEREFORE, THESE APPEALS BEFORE US. 5. THE COMMON CONTENTION OF THE REVENUE IS THAT IF THE ITEMS EXCLUDED FROM THE EXPORT TURNOVER ARE EXCLUDE D FROM THE - - ITA NOS.54 & 1197 OF 2010 3 TOTAL TURNOVER ALSO, THE VERY PURPOSE OF EXCLUDING THOSE ITEMS FROM THE EXPORT TURNOVER WOULD BE DEFEATED. THE VE RY SAME ISSUE WAS CONSIDERED BY THE MADRAS SPECIAL BENCH OF THE TRIBUNAL (BENCH-D) IN THE CASE OF ITO VS. M/S. SAK SOFT LTD., 121 TTJ 865, WHERE THE SPECIAL BENCH HAS HELD THAT THE ADJUSTMENT MUST BE MADE BOTH IN THE NUMERATOR AND DENOMINATOR. IN VIEW OF THE SPECIAL BENCH DECISION, WE FIND THAT THE ORD ERS OF THE COMMISSIONER OF INCOME-TAX(APPEALS) ARE SUSTAINABLE IN LAW. 6. IN RESULT THESE TWO APPEALS FILED BY THE REVENU E ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HEARING ON THURSDAY, THE 8 TH OF SEPTEMBER, 2011 AT CHENNAI. SD/- SD/- (HARI OM MARATHA) (DR. O.K.NARAYANAN) JUDICIAL MEMBER VICE-PRESIDENT CHENNAI, DATED THE 8 TH SEPTEMBER, 2011. V.A.P. COPY TO: APPELLANT/ RESPONDENT/ CIT/ CIT(A) /D.R./G.F.