DCIT, CHENNAI V. M/s. AVT Infotech Pvt. Ltd., CHENNAI

ITA 65/CHNY/2011

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 4782 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-06-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 29-06-2011
• Assessment Year: 2007-2008
• Appeal Filed On: 13-01-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: K E B RENGARAJAN JR
• Section: 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL BENCH D CHENNAI BEFORE SHRI N.S. SAINI, AM AND SHRI GEORGE MATHAN, J.M. .. I.T.A. NO. 65/MDS/2011 DY. C.I.T COMPANY CIRCLE I(1) CHENNAI 600 034. VS. M/S AVT INFOTECH PVT. LTD 64, RUKMANI LAKSHMIPATHY SALAI CHENNAI 600 008. PAN NO. AACCA 8938 J (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE DEPARTMENT BY : SHRI K.E.B. RENGARAJAN JR. STANDING COUNSEL O R D E R PER N.S. SAINI, A.M :- THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINS T THE ORDER PASSED BY THE CIT(A)-III, CHENNAI DATED 29.10.2010. 2. THE SOLE ISSUE RAISED BY THE REVENUE IN THIS APP EAL IS THAT THE LD. CIT(A) ERRED IN DIRECTING THE ASSESSING OFFICER TO RECOMPUTE THE PAGE 2 OF 4 I.T.A. NO. 65/MDS/2011 DEDUCTION U/S 10B OF THE INCOME-TAX ACT, 1961 [IN S HORT, THE ACT] BY EXCLUDING THE TELECOMMUNICATION AND OTHER EXPENSES INCURRED IN FOREIGN CURRENCY BOTH FROM EXPORT TURNOVER AND TOTA L TURNOVER BY FOLLOWING THE DECISION OF THE CHENNAI SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. SAFSOFT LIMITED WHICH HAS NO T BECOME FINAL AS THE DEPARTMENT HAS PREFERRED AN APPEAL BEFORE THE HIGH COURT. 3. THE LD. D.R. RELIED ON THE GROUNDS OF APPEAL OF THE REVENUE WHEREAS THE LD. A.R. OF THE ASSESSEE FILED AN ADJOU RNMENT APPLICATION WHICH WAS REJECTED BY THE BENCH. 4. AFTER CONSIDERING THE SUBMISSIONS OF THE LD. D.R . AND PERUSING THE MATERIAL ON RECORD, WE FIND THAT IN THE INSTANT CASE, FOR COMPUTING DEDUCTION U/S 10B OF THE ACT THE TELECOMM UNICATION AND OTHER EXPENSES OF RS. 82,06,496/- INCURRED IN FORE IGN CURRENCY WAS DEDUCTED BY THE ASSESSEE FROM EXPORT TURNOVER AND T OTAL TURNOVER. ACCORDING TO THE ASSESSING OFFICER, PROVISIONS OF S ECTION 10B OF THE ACT REQUIRE THAT THE ABOVE EXPENDITURE IS TO BE RED UCED FROM THE EXPORT TURNOVER ONLY IN COMPUTING DEDUCTION U/S 10B OF THE ACT. THE ASSESSING OFFICER HAS ALSO OBSERVED THAT THE AS SESSEE HAS RELIED PAGE 3 OF 4 I.T.A. NO. 65/MDS/2011 ON THE DECISION OF THE CHENNAI SPECIAL BENCH OF THE TRIBUNAL IN THE CASE OF ITO VS. SAFSOFT LIMITED DATED 6.3.2009 BUT HE WAS NOT ACCEPTING THE DECISION OF THE TRIBUNAL AS THE REVEN UE HAS FILED APPEAL BEFORE THE HON'BLE MADRAS HIGH COURT AND THE REFORE, HE WANTED TO KEEP THE ISSUE ALIVE. 5. IN APPEAL, THE LD. CIT(A) ALLOWED THE CLAIM OF T HE ASSESSEE OBSERVING THAT THE ISSUE WAS COVERED BY THE DECISIO N OF THE SPECIAL BENCH OF THE TRIBUNAL AS WELL AS BY THE DECISION OF THE MUMBAI HIGH COURT IN THE CASE OF CIT VS. GEM PLUS JEWELRY INDIA LIMITED REPORTED IN 233 CTR 46 [MUM]. THE LD. D.R. COULD NOT FILE A NY MATERIAL BEFORE US TO SHOW THAT THE DECISION OF THE SPECIAL BENCH OF THE TRIBUNAL WAS REVERSED IN APPEAL BY ANY HIGHER AUTHO RITY. HE ALSO COULD NOT FILE ANY CONTRARY DECISION TO THE ONE REL IED ON BY THE LD. CIT(A). WE, THEREFORE, FIND NO INFIRMITY IN THE OR DER OF THE LD. CIT(A), WHICH IS CONFIRMED. GROUND OF APPEAL RAISE D BY THE REVENUE IS DISMISSED. PAGE 4 OF 4 I.T.A. NO. 65/MDS/2011 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE S TANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT IMMEDIATELY AFT ER THE CONCLUSION OF HEARING ON 29 TH JUNE 2011. SD/- SD/- ((GEORGE MATHAN ) (N.S. SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER CHENNAI, DATED THE 29 TH JUNE, 2011. VL COPY TO: