A.C.I.T.-2(1)(3) CITY-2, MUMBAI V. E-CLERX SERVICES LTD., MUMBAI

ITA 6479/MUM/2012

• Counselvise Citation: 647919914 RSA 2012
• Duration Of Justice: 1 year(s) 8 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-07-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 10-07-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 23-10-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: KISHAN VYAS; CAPT PRADEEP SHOURY ARYA
• Assessee Lawyers: HITEN VASANT

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL E BENCH, MUMBAI BEFORE HONBLE S/SHRI H.L. KARWA, PRESIDENT AND B. R.BASKARAN (AM) . . , . . , ./I.T.A. NO.6478 & 6479/MUM/2012 ( / ASSESSMENT YEAR :2005-06 & 2007-08 ) INCOME TAX OFFICER, 2(1)(3), ROOM NO.553, 5 TH FLOOR, AAYAKAR BHAVAN, M K ROAD, MUMBAI- 400020 / VS. M/S E - CLERX SER V ICES LTD, 29, BANK STREET, 1 ST FLOOR, FORT, MUMBAI-400023. ( / APPELLANT) .. ( !' / RESPONDENT) ./ #$ ./PAN/GIR NO. : AAACE7932L % / APPELLANT BY : SHRI KISHAN VYAS AND CAPT.PRADEEP SHOURY ARYA !' & % /RESPONDENT BY : SHRI HITEN VASANT ' & ( ) / DATE OF HEARING : 10.7.2014 *+ & ( ) /DATE OF PRONOUNCEMENT : 18. 7.2014 / O R D E R PER B.R.BASKARAN, ACCOUNTANT MEMBER: BOTH THE APPEALS FILED BY THE REVENUE ARE DIRECTED AGAINST THE TWO EPARATE ORDERS DATED 27.08.2012 PASSED BY LD CIT(A)-4, MUMB AI AND THEY RELATE TO THE ASSESSMENT YEARS 2005-06 AND 2007-08. BOTH THE AP PEALS WERE HEARD TOGETHER AND HENCE THEY ARE BEING DISPOSED OF BY THIS COMMON ORDER, FOR THE SAKE OF CONVENIENCE. 2. IN AY 2005-06, THE REVENUE IS AGGRIEVED BY T HE DECISION OF LD CIT(A) IN HOLDING THAT THE AGGREGATE AMOUNT RELATING TO INSUR ANCE CHARGES, INTEREST, I.T.A. NO.6478 & 6479/MUM/2012 2 TELEPHONE CHARGES AND PROFESSIONAL FEES WHICH WERE REDUCED FROM THE EXPORT TURNOVER IS REQUIRED TO BE REDUCED FROM THE TOTAL T URNOVER ALSO, FOR WORKING OUT THE AMOUNT OF EXEMPTION UNDER SEC. 10A OF THE ACT. 3. IN AY 2007-08, THE REVENUE IS AGGRIEVED BY TH E DECISION OF LD CIT(A) IN HOLDING THAT THE AGGREGATE AMOUNT RELATING TO RECRU ITMENT CHARGES AND CONTRACT CHARGES WHICH WERE REDUCED FROM THE EXPORT TURNOVER IS REQUIRED TO BE REDUCED FROM THE TOTAL TURNOVER ALSO FOR WORKING OUT THE AM OUNT OF EXEMPTION UNDER SEC. 10A OF THE ACT. 4. THUS, THE COMMON ISSUE THAT ARISES BEFORE US F OR OUR CONSIDERATION IS WHETHER THE AMOUNT DEDUCTED FROM THE EXPORT TURNOV ER IS REQUIRED TO BE DEDUCTED FROM THE TOTAL TURNOVER ALSO OR NOT FOR COMPUTING EXEMPTION U/S 10A OF THE ACT. 5. THE AO REJECTED THE REQUEST OF THE ASSESSEE TO DEDUCT THE AMOUNT OF INSURANCE CHARGES, INTEREST, TELEPHONE CHARGES AND PROFESSIONAL FEES FROM THE TOTAL TURNOVER IN AY 2005-06 AND THE RECRUITMENT C HARGES AND CONTRACT CHARGES FROM THE TOTAL TURNOVER IN AY 2007-08 FOR COMPUTING DEDUCTION U/S 10A OF THE ACT. THE LD CIT(A) HOWEVER ALLOWED THE CLAIM OF TH E ASSESSEE IN BOTH THE YEARS AND HENCE THE REVENUE HAS FILED THESE APPEALS BEFOR E US. HENCE THE REVENUE HAS FILED THESE APPEALS BEFORE US. 6. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED THE RECORD. WE NOTICE THAT THE LD CIT(A), IN BOTH THE YEARS, HAS FOLLOWED THE DECISION RENDERED BY THE HONBLE JURISDICTIONAL BOMBAY HIGH COURT IN THE CAS E OF SUDARSHAN CHEMICAL INDUSTRIES LTD (245 ITR 769) IN DECIDING THE IMPUGN ED ISSUES IN FAVOUR OF THE ASSESSEE. IN ASSESSMENT YEAR 2007-08, THE LD CIT(A ) HAS ALSO FOLLOWED THE I.T.A. NO.6478 & 6479/MUM/2012 3 DECISION RENDERED BY HONBLE SUPREME COURT IN THE C ASE OF LAXMI CHEMICAL WORKS (290 ITR 657). IN THE CASE OF SUNDARSHAN CHE MICAL INDUSTRIES LTD (SUPRA), THE HONBLE JURISDICTIONAL HIGH COURT HAS HELD THAT THE EXPORT TURNOVER AND TOTAL TURNOVER HAVE TO BE TAKEN ON THE SAME BAS IS AND ALL THE ITEMS THAT WERE REDUCED FROM EXPORT TURNOVER WOULD HAVE TO BE REDUCED FROM THE TOTAL TURNOVER AS WELL. SINCE THE LD CIT(A) HAS FOLLOWED THE RATIO LAID DOWN BY THE JURISDICTIONAL HIGH COURT, WE DO NOT FIND ANY REASO N TO INTERFERE WITH HIS DECISION IN BOTH THE YEARS. 7. IN THE RESULT, BOTH THE APPEALS FILED BY THE REVENUE ARE DISMISSED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT O N 18TH JULY, 2014. *+ ' , -. / 0 18TH JULY, 2014 + & 2 3 SD SD ( . . / H.L. KARWA) ( . . , / B.R. BASKARAN ) / PRESIDENT / ACCOUNTANT MEMBER - ' MUMBAI: 18TH JULY,2014. . . ./ SRL , SR. PS ! ' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. !' / THE RESPONDENT. 3. ' 5( ( ) / THE CIT(A)- CONCERNED 4. ' 5( / CIT CONCERNED 5. 67 2 !(8 , ) 8 , - ' / DR, ITAT, MUMBAI CONCERNED 6. 2 9 : / GUARD FILE. ; ' / BY ORDER, TRUE COPY < # (ASSTT. REGISTRAR) ) 8 , - ' /ITAT, MUMBAI