ITO, Bangalore V. M/s Evershine Infotech Pvt. Ltd., Bangalore

ITA 611/BANG/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0561 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-10-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 22-10-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 11-06-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PREETHI GARG
• Assessee Lawyers: H N RAVI
• Section: 10B; 10

Judgement Text

ITA NO.611/B/09 1 IN THE INCOME TAX APPELL ATE TRIBUNAL, IN THE INCOME TAX APPELLATE TRIBUNAL, IN THE INCOME TAX APPELLATE TRIBUNAL, IN THE INCOME TAX APPELLATE TRIBUNAL, BANGALORE BENCH BANGALORE BENCH BANGALORE BENCH BANGALORE BENCH B BB B BEFORE BEFORE BEFORE BEFORE GEORGE GEORGE K, JUDICIAL MEMBER GEORGE GEORGE K, JUDICIAL MEMBER GEORGE GEORGE K, JUDICIAL MEMBER GEORGE GEORGE K, JUDICIAL MEMBER AND AND AND AND SHRI SHRI SHRI SHRI A. MOHAN ALANKAMONY A. MOHAN ALANKAMONY A. MOHAN ALANKAMONY A. MOHAN ALANKAMONY, A , A, A , ACCOUNTANT MEMBER CCOUNTANT MEMBER CCOUNTANT MEMBER CCOUNTANT MEMBER ITA NO.611/BAN G/2009 (ASSESSMEN T YEAR 2005-06) THE INCOME-TAX OFFICER, WARAD-11(1), BANGALORE. . APPELLANT VS. M/S EVERSHINE INFOTECH PVT. LTD., NO.15, 2 ND FLOOR, VITTAL MALLAYA ROAD, BANGALORE-560 001. APPELLANT BY : SMT. PREETHI GARG RESPONDENT BY : SHRI H.N RAVI O R D E R O R D E R O R D E R O R D E R PER PER PER PER GEORGE GEORGE GEORGE GEORGE GEORGE GEORGE GEORGE GEORGE K KK K, , , , JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER JUDICIAL MEMBER : : : : THIS APPEAL PREFERRED BY THE REVENUE IS DIRECTED AG AINST THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (AP PEALS) - I, BANGALORE DATED 26.03.2009. THE ASSESSMENT YEAR CO NCERNED IS 2005-06. 2. THE REVENUE HAS RAISED THE FOLLOWING EFFECTIVE G ROUNDS : (I) THE LEARNED CIT(A) WAS NOT JUSTIFIED IN DIRECTING THE AO TO ALLOW DEDUCTION U/S 10A OF THE I.T ACT, WITHOUT APPRECIATING THAT THE JOB OF MEDICAL TRANSCRIPTION WAS EXECUTED OUTSIDE THE SPECIFIED ITA NO.611/B/09 2 AREAS/ZONES BY SUBCONTRACTING THE SALE OF MEDICAL TRANSCRIPTION TO THREE COMPANIES VIZ., (1) M/S TARG ET TRANSCRIPTION PVT. LTD., (2) INFY COMMUNICATIONS PV T. LTD., AND (3) XEN CALL CENTRE PVT. LTD., THEREBY NO T FULFILLING THE PROVISIONS OF SEC. 10A(2)(I) OF THE I.T ACT. (II) THE CIT(A) HAD ERRED IN RELYING UPON BOARDS CIRCULAR NO.1 OF 2005 RELATING TO DEDUCTION U/S 10B WHILE DECIDING THE ALLOWABILITY OF DEDUCTION U/S 10 A IN THE FACTS AND CIRCUMSTANCES OF THE ASSESSEES CASE. THE BRIEF FACTS OF THE CASE ARE AS FOLLOWS : 3. THE ASSESSEE IS A COMPANY. IT IS ENGAGED IN THE DEVELOPMENT OF COMPUTER SOFTWARE. FOR THE CONCERNED YEAR, THE RETURN OF INCOME WAS FILED ON 31.10.05 DECLARING A TOTAL INCOME OF R S.1,45,100/- AFTER CLAIMING DEDUCTION OF RS.37,50,484/- U/S 10A OF THE ACT. THE CASE WAS SELECTED FOR SCRUTINY AND ASST. WAS COMPLETED U/S 1 43(3) DISALLOWING THE CLAIM OF THE ASSESSEE COMPANY U/S 10A OF THE A CT. THE REASON FOR DENYING THE DEDUCTION U/S 10A OF THE ACT WAS ON THE GROUND THAT THE ASSESSEE CANNOT CLAIM THE BENEFIT FOR WORK WHICH WA S OUTSOURCED/SUB- CONTRACTED TO OTHER MANUFACTURERS, WHICH WAS CARRI ED OUT OUTSIDE THE CUSTOM BOUNDED AREA. 4. THE LEARNED CIT(A), ON APPEAL FILED BY THE ASSES SEE, ALLOWED THE CLAIM OF THE ASSESSEE. THE LEARNED CIT(A) FOLL OWED THE ORDER OF THE TRIBUNAL IN ASSESSEES OWN CASE FOR THE ASST. Y EAR 2003-04 (ITA ITA NO.611/B/09 3 NO.798/07 DATED 18.7.08), WHEREIN THE ISSUE WAS DEC IDED IN FAVOUR OF THE ASSESSEE BY DISMISSING REVENUES APPEAL. THE REVENUE BEING AGGRIEVED BY THE ORDER OF THE LE ANED CIT(A) IS IN APPEAL BEFORE US. 5. AT THE VERY OUTSET, IT WAS POINTED OUT BY THE L EARNED COUNSEL FOR THE ASSESSEE THAT THE ISSUE IN QUESTION IS SQUARELY COVERED BY THE TRIBUNALS DECISION IN ASSESSEES OWN CASE CITED SU PRA. THE LEARNED DR FAIRLY CONCEDED THAT THE ISSUE IS COVERED IN FAV OUR OF THE ASSESSEE. 6. HAVING HEARD THE RIVAL SUBMISSIONS AND PERUSED T HE MATERIAL ON RECORD, WE ARE OF THE CONSIDERED VIEW THAT THE ISSU E HAS BEEN DECIDED IN FAVOUR OF THE ASSESSEE BY THE TRIBUNAL IN ASSESS EES OWN CASE CITED SUPRA FOR THE ASST. YEAR 2003-04. THE GIST OF THE TRIBUNALS DECISION HAS BEEN REPRODUCED AT PAGES 5 AND 6 OF THE IMPUGNE D LEARNED CITS ORDER AND SAME IS NOT REITERATED HERE. THE FACTUA L POSITION IN THE INSTANT CASE BEING SAME FOR THE ASST. YEAR 2003-04 , WE FOLLOW THE CO- ORDINATE BENCH DECISION OF THE TRIBUNAL IN ASSESSEE S OWN CASE CITED SUPRA AND DECIDE THE ISSUE IN FAVOUR OF THE ASSESSE E. ITA NO.611/B/09 4 7. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON 30TH OCT, 2009. SD/ SD/ SD/ SD/- -- - SD/ SD/ SD/ SD/- -- - ( (( (A. MOHAN ALANKAMONY A. MOHAN ALANKAMONY A. MOHAN ALANKAMONY A. MOHAN ALANKAMONY) ) ) ) ( ( ( (GEORGE GEORGE K) GEORGE GEORGE K) GEORGE GEORGE K) GEORGE GEORGE K) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE DATED : 30/10/09 VMS. COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3. THE CIT CONCERNED. 4. THE CIT(A) CONCERNED. 5. DR 6. GF 7. GF, ITAT, NEW DELHI. BY ORDER ASST. REGISTRAR, ITAT, BANGAL ORE.