ACIT, Bangalore V. M/s Infosys BPO Ltd., Bangalore

ITA 544/BANG/2012

• Counselvise Citation: [2013] 120 COUNSELVISE.COM (IT) 0660 (ITAT-BANGALORE)
• Duration Of Justice: 9 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-02-2013
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 11-02-2013
• Assessment Year: 2006-2007
• Appeal Filed On: 19-04-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BIJOY KUMAR PANDA
• Assessee Lawyers: PADAMCHAND KHINCHA

Judgement Text

ITA.544/BANG/2012 PAGE - 1 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH 'A', BANGALORE BEFORE SHRI. N. BARATHVAJA SANKAR, VICE PRESIDENT AND SHRI. GEORGE GEORGE K. JUDICIAL MEMBER I.T.A NO.544/BANG/2012 (ASSESSMENT YEAR : 2006-07) ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE - 11(4), BANGALORE .. APPELLANT V. M/S. INFOSYS BPO LTD, PLOT NO.26/3, 26/4, 26/6, ELECTRONIC CITY, KONAPPANA AGRAHARA, HOSUR ROAD, BANGALORE 560 100 .. RESPONDENT PAN : AACCP4478N APPELLANT BY : SHRI. BIJOY KUMAR PANDA, ADDL.CIT RESPONDENT BY : SHRI. PADAM CHAND KHINCHA, CA DATE OF HEARING : 11.02.2013 DATE OF PRONOUNCEMENT : 11.02.2013 O R D E R PER N. BARATHVAJA SANKAR, VICE PRESIDENT : THIS IS AN APPEAL PREFERRED BY THE REVENUE FOR THE ASSESSMENT YEAR 2006-07 IN THE CASE OF M/S. INFOSYS BPO LTD, B ANGALORE, AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEA LS)-1, BANGALORE, DATED.17.02.2012. 02. THE ONLY ISSUE BROUGHT BEFORE US BY THE REVENUE IS WHETHER THE COMMISSIONER OF INCOME-TAX (APPEALS) HAS ERRED IN D ELETING THE ITA.544/BANG/2012 PAGE - 2 ADDITION OF RS.4,18,829/- AS VALUE OF FRINGE BENEFI TS ON 'VISA CHARGES AND OTHER ACCOUNT' U/S.115WB(2)(F) OF THE IT ACT, 1 961, WITHOUT APPRECIATING THE FACTS AND CIRCUMSTANCES UNDER WHIC H THE ADDITION WAS MADE BY THE ASSESSING OFFICER. THE OTHER CONNECTED GROUNDS READ AS UNDER : 3) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) HAS NOT APPRECIATED THE FACT THAT THE EXPENSES DEBITED UNDE R THE HEAD 'VISA CHARGES AND OTHER ACCOUNT' LIKE WORK PERMITS, BUSINESS VISAS ETC., ARE INDISPENSABLE PART OF FOREIGN TRAVE L AND ARE COVERED BY THE PROVISIONS OF SEC.115WB(2)(F) OF THE IT ACT, 1961. 4) THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN ALLOWING THE RELIEF, RELYING ON HIS DECISION IN THE CASE OF ASSESSEE'S PARENT COMPANY, M/S. INFOSYS TECHNOLOGIE S LTD., FOR EARLIER YEARS, WITHOUT APPRECIATING THAT THE MATTER HAS NOT REACHED ITS FINALITY AND APPEAL HAS BEEN FILED BEFO RE THE HON'BLE ITAT AGAINST SUCH ORDER. 03. WE HAVE HEARD THE RIVAL SUBMISSIONS AND CONSIDE RED THE FACTS AND MATERIALS ON RECORD. THE LEARNED COUNSEL FOR T HE ASSESSEE PLACED ON RECORD A COPY OF THE ORDER DATED.08.06.2012 IN I TA NO.96/BANG/2011, FOR THE SAME ASSESSMENT YEAR, IN M /S. INFOSYS ITA.544/BANG/2012 PAGE - 3 TECHNOLOGIES LTD., AND CLAIMED THAT THE VERY SAME I SSUE WAS ELABORATELY CONSIDERED IN THE SAID ORDER AND THE AP PEAL OF THE REVENUE WAS DISMISSED. 04. FROM GROUND NO.3 RAISED BEFORE US, IT TRANSPIRE S THAT THE REVENUE IS CLAIMING THAT THE MATTER HAS NOT REACHED FINALITY AS APPEAL WAS FILED BEFORE THE ITAT AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) IN THE CASE OF M/S. INFOSYS TE CHNOLOGIES LTD., HOWEVER, THE ASSESSEE'S COUNSEL HAS PLACED ON RECOR D COPY OF THE ORDER OF THE TRIBUNAL IN THE CASE OF M/S. INFOSYS T ECHNOLOGIES WHEREBY THE TRIBUNAL FOLLOWING THE CO-ORDINATE BENC H IN THE CASE OF M/S. TOYOTA KIRLOSKAR MOTOR P. LTD., IN ITA NO.20/B ANG/2011, DATED.11.05.2012 HAS DISMISSED THE REVENUE'S APPEAL . IN OTHER WORDS, THE APPEAL IN THE CASE OF M/S. INFOSYS TECHNOLOGIES LTD., HAS ATTAINED FINALITY BY THE ABOVE SAID ORDER. FURTHER NOTHING HAS BEEN BROUGHT ON RECORD BY THE REVENUE TO SHOW THAT THE SAID ORDER O F THE TRIBUNAL HAS BEEN DISTURBED BY THE HON'BLE HIGH COURT OF KARNATA KA. IN SUCH FACTS AND CIRCUMSTANCES, THE DECISION OF M/S. INFOSYS TEC HNOLOGIES LTD., CITED SUPRA IS HOLDING THE FIELD AND WE ARE BOUND B Y THE SAID DECISION. FURTHER, WE DO NOT FIND ANY CHANGE IN THE FACTS AND CIRCUMSTANCES OF THIS CASE FROM THAT OF M/S. INFOSYS TECHNOLOGIES LT D., IN THE CASE OF ITA.544/BANG/2012 PAGE - 4 M/S. INFOSYS TECHNOLOGIES LTD., AT PARA NO.6.3 OF T HE ORDER, THE TRIBUNAL HAS OBSERVED AS UNDER : '6.3 IN THE INSTANT CASE, THE EXPENSES INCURRED UND ER THE HEAD 'VISA CHARGES AND OTHERS' IS A LEGITIMATE BUSI NESS EXPENDITURE INCURRED BY THE ASSESSEE. THEY ARE STA TUTORY IN NATURE AND ARE NEITHER PAID TO THE EMPLOYEES NOR IN CURRED FOR THE BENEFIT OF THE EMPLOYEES OF THE ASSESSEE COMPAN Y. THESE CHARGES ARE NOT INCURRED OR PAID AS A CONSIDERATION FOR EMPLOYMENT. THE DECISION OF THE CO-ORDINATE BENCH IN THE CASE OF M/S. TOYOTA KIRLOSKAR MOTOR P. LTD. (SUPRA) IS SQUARELY APPLICABLE TO THE INSTANT CASE. THE FINDI NGS OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) IN CON CLUDING THAT THE EXPENSES UNDER THE HEAD 'VISA CHARGES AND OTHERS' ARE NOT LIABLE FOR FBT ARE CORRECT, FOR THE ABOVE R EASONS AND IS IN ACCORDANCE WITH LAW.' 05. HENCE, FOLLOWING THE ABOVE DECISION OF THIS TRI BUNAL, WE ARE DISMISSING THE PRESENT REVENUE'S APPEAL 06. IN THE RESULT, REVENUS'S APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11.02.2012, A FTER THE HEARING. (GEORGE GEORGE K) (N. BARATHVAJA SANKAR) JUDICIAL MEMBER VICE PRESIDENT ITA.544/BANG/2012 PAGE - 5