ITO 5(3)(2), MUMBAI V. SAVVION INDIA P. LTD, MUMBAI

ITA 5714/MUM/2009

• Counselvise Citation: [2010] 136 COUNSELVISE.COM (IT) 1328 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-06-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 2003-2004
• Appeal Filed On: 26-10-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRADEEP HEDAOO
• Section: 271(1)(c); 10B

Judgement Text

ITA NO. 5714 & 2715/MUM/2009 ASSESSMENT YEARS : 03-04 & 04-05 PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI I BENCH, MUMBAI BEFORE, SHRI N.V. VASUDEVAN (JUDICIAL MEMBER) AND SHRI PRAMOD KUMAR (ACCOUNTANT MEMBER) ITA NO. 5714 AND 5715/MUM/2009 ASSESSMENT YEARS 2003-04 AND 2004-05 DATE OF HEARING : 22.6.2010 INCOME TAX OFFICER 5(3)2 ... ... APPELLANT AAYAKAR BHAVAN, M.K. ROAD MUMBAI 400 020 VS. M/S. SAVVION INDIA PVT. LTD. .. RESPOND ENT 14 C, CRYSTAL, 36, ALTAMOUNT ROAD MUMBAI 400 026 AAACT7450Q APPELLANT BY : SHRI PRADEEP HEDAOO RESPONDENT BY : SHRI P.R.V. RAGHAVAN O R D E R PER PRAMOD KUMAR: 1. BY WAY OF THESE APPEALS, THE ASSESSING OFFICER H AS CHALLENGED CORRECTNESS OF ORDER OF EVEN DATE 24 TH AUGUST 2009. PASSED BY THE LEARNED COMMISSIONER (APPEALS)V, MUMBAI, FOR ASSES SMENT YEARS 2003-04 AND 2004-05. SINCE THE ASSESSEE BEING SAME IN BOTH THE ITA NO. 5714 & 2715/MUM/2009 ASSESSMENT YEARS : 03-04 & 04-05 PAGE 2 OF 5 APPEALS, THEREFORE, THESE APPEALS WERE HEARD TOGETH ER AND ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAK E OF CONVENIENCE. 2. THE COMMON GRIEVANCE, EXCEPT VARIATION IN FIGURES, RAISED BY THE ASSESSING OFFICER IN BOTH THE APPEALS, IS AS FOLLOW S:- ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND AS PER LAW, THE LD. CIT(A) ERRED IN DELETING THE DISAL LOWANCE OF DEDUCTION U/S 10B OF THE ACT THOUGH THE ASSESSEE IS NOT ENGAGED IN BUSINESS OF EXPORT OF SOFTWARE, THEREBY ALSO DELETING THE PENALTY U/S 271(1)(C) OF THE ACT. 3. WHILE THE GRIEVANCE RAISED ABOVE, MENTIONS ABOUT DI SALLOWANCE OF DEDUCTION U/S 10B, WE MAY CLARIFY THAT IT IS NOT HAPPILY WORDED INASMUCH AS SOLITARY GRIEVANCE THAT WE ARE REQUIRED TO ADJUDICATE IS, WHETHER OR NOT, THE LD. CIT(A) WAS JUSTIFIED IN DEL ETING THE PENALTY IMPOSED ON THE ASSESSEE U/S 271(1)(C) OF THE ACT. T HE REFERENCE TO SECTION 10B IS, THEREFORE, UNCALLED FOR. 4. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE DEDUCT ION U/S 10B, AS CLAIMED BY THE ASSESSEE, WAD DECLINED. THE LD. C IT(A) ALSO CONFIRMED THE SAID ACTION OF THE ASSESSING OFFICER. HOWEVER, WHEN THE MATTER TRAVELLED IN APPEAL BEFORE THE TRIBUNAL, GRI EVANCE OF THE ASSESSEE WAS UPHELD AND, ACCORDINGLY, DEDUCTION U/S 10B WAS DULY GRANTED. THE REVENUE CARRIED THE MATTER IN APPEAL B EFORE THE HONBLE BOMBAY HIGH COURT, WHEREIN, THEIR LORDSHIPS, VIDE J UDGMENT DATED 7 TH AUGUST 2009, DECLINED TO INTERFERE IN THE MATTER AN D, THUS, THE ORDER OF THE TRIBUNAL HAS REACHED FINALITY. IT IS IN CONNECT ION WITH THE DEDUCTION U/S 10B HAVING BEEN SO DECLINED BY THE AS SESSING OFFICER ITA NO. 5714 & 2715/MUM/2009 ASSESSMENT YEARS : 03-04 & 04-05 PAGE 3 OF 5 THAT THE IMPUGNED PENALTY WAS IMPOSED ON THE ASSESS EE. WHEN THE MATTER WAS CARRIED IN APPEAL BEFORE LD. CIT(A), THE LD. CIT(A) NOTED THAT THE RELATED QUANTUM DISALLOWANCE HAS BEEN DELE TED BY THE TRIBUNAL AND, THEREFORE, THE PENALTY IS ALSO TO BE DELETED. REVENUE IS AGGRIEVED AND IS IN APPEAL BEFORE US. 5. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MA TERIAL ON RECORD AND DULY CONSIDERED FACTUAL MATRIX OF THE CA SE AS ALSO THE APPLICABLE LEGAL POSITION. 6. WE HAVE NOTED THAT THE VERY DISALLOWANCE OF DEDUCTI ON NO LONGER SURVIVES, THE VERY FOUNDATION OF THE IMPUGNED PENAL TY CEASES TO EXIST. IN THIS VIEW OF THE MATTER AND HAVING REGARD TO THE FACT THAT THE IMPUGNED QUANTUM DISALLOWANCE ITSELF DOES NOT SURVI VE ANY LONGER, WE APPROVE THE CONCLUSION SO ARRIVED AT BY THE LD. CIT (A) AND DECLINE TO INTERFERE IN THE MATTER. 7. IN THE RESULT, APPEALS FILED BY THE ASSESSING OFFIC ER ARE DISMISSED. PRONOUNCED IN THE OPEN COURT TODAY ON TH IS 25 TH DAY OF JUNE 2010. SD/XX SD/XX (N.V. VASUDEVAN) (PRAMOD KUMAR) JUDICIAL MEMBER ACCOUNTANT MEMBER MUMBAI; 25 TH DAY OF JUNE 2010. ITA NO. 5714 & 2715/MUM/2009 ASSESSMENT YEARS : 03-04 & 04-05 PAGE 4 OF 5 COPY FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT 3. DIRECTOR OF INCOME TAX (INTERNATIONAL TAXATION), MUMBAI 4. COMMISSIONER (APPEALS) , MUMBAI 5. DEPARTMENTAL REPRESENTATIVE, I BENCH, ITAT, MUMB AI 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR PRADEEP J. CHOWDHURY INCOME TAX APPELLATE TRIBUNAL SR. PRIVATE SECRETARY MUMBAI BENCHES, MUMBAI ITA NO. 5714 & 2715/MUM/2009 ASSESSMENT YEARS : 03-04 & 04-05 PAGE 5 OF 5 DATE INITIAL 1. DRAFT DICTATED ON 23.6.2010 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 23.6.2010 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 23.6.2010 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 23.6.2010 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 23.6.2010 SR.PS/PS 6. DATE OF PRONOUNCEMENT 25.6.2010 SR.PS 7. FILE SENT TO THE BENCH CLERK SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER