Spritie Software Pvt. Ltd., CHENNAI V. ACIT, CHENNAI

ITA 65/CHNY/2015

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 90539 (ITAT-CHENNAI)
• Duration Of Justice: 5 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-07-2015
• Appeal Filed By: Assessee
• Bench Allotted: B
• Next Hearing Date: 21-05-2015
• Assessment Year: 2011-2012
• Appeal Filed On: 12-01-2015
• Court: TRIBUNAL
• Department Lawyers: N MADHAVAN
• Assessee Lawyers: N DEVANATHAN
• Section: 10B

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : CHENNAI . . . , . !' , # $ % [ BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ] ./ I.T.A.NO.65/MDS/2015 / ASSESSMENT YEAR : 2011-12 M/S SPRITLE SOFTWARE PVT. LTD S-4, AQUARIUS VGN ZODIAC VILLE NO.62, DEVADOSS STREET MOGAPAIR EAST CHENNAI 600 037 VS. THE ASSTT. COMMISSIONER OF INCOME-TAX COMPANY CIRCLE VI(4) CHENNAI [PAN AANCS 3106 R] ( &' / APPELLANT) ( ()&' /RESPONDENT) / APPELLANT BY : SHRI N. DEVANATHAN, ADVOCATE /RESPONDENT BY : SHRI N. MADHAVAN, JCIT / DATE OF HEARING : 21 - 05 - 2015 ! / DATE OF PRONOUNCEMENT : 10 - 0 7 - 2015 / O R D E R PER N.R.S.GANESAN, JUDICIAL MEMBER THIS APPEAL OF THE ASSESSEE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-VI, CHENNA I, DATED 28.10.2014 AND PERTAINS TO ASSESSMENT YEAR 2011-12 . 2. SHRI N. DEVANATHAN, LD. COUNSEL FOR THE ASSESSEE SU BMITTED THAT THE ONLY ISSUE ARISES FOR CONSIDERATION IS DED UCTION U/S 10B OF THE ITA NO. 65/15 :- 2 -: ACT. THE LD. COUNSEL SUBMITTED THAT THE ASSESSEE CLAIMED DEDUCTION U/S 10B BEFORE THE ASSESSING OFFICER. HOWEVER, THE ASSESSING OFFICER DISALLOWED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE ASSESSEE HAS NOT OBTAINED APPROVAL FROM THE COMPETENT AUTHOR ITY. THE LD. COUNSEL FURTHER SUBMITTED THAT THE ASSESSEE HAS PR ODUCED COPY OF THE RATIFICATION GIVEN BY THE BOARD OF APPROVAL GRANTED BY DEVELOPMENT COMMISSIONER U/S 10B OF THE ACT. REFERRING TO THE CIRCULAR ISSUED BY THE CBDT IN INSTRUCTION NO.2 OF 2009, DATED 9.3.200 9, THE LD. COUNSEL SUBMITTED THAT EXEMPTION U/S 10B IS AVAILABLE IN T HE CASE OF 100% EXPORT ORIENTED UNDERTAKING WHICH WAS APPROVED BY T HE BOARD APPOINTED BY GOVERNMENT OF INDIA UNDER SEC. 14 OF T HE INDUSTRIES (DEVELOPMENT AND REGULATION) ACT, 1951. EVEN OTHER WISE, ACCORDING TO THE LD. COUNSEL, THE ASSESSEE IS ELIGIBLE FOR E XEMPTION U/S 10A OF THE ACT. THE LD. COUNSEL PLACED HIS RELIANCE ON THE DECISION OF THE HYDERABAD BENCH OF THIS TRIBUNAL IN M/S VSN MAKRO T ECHOLOGIES PVT. LTD VS ACIT DATED 13.1.2011. 3. ON THE CONTRARY, SHRI N. MADHAVAN, LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT FOR CLAIMING EXEMPTIO N U/S 10B, THE ASSESSEE HAS TO NECESSARILY OBTAIN APPROVAL FROM TH E BOARD NOTIFIED BY THE GOVERNMENT OF INDIA UNDER THE INDUSTRIES (DEVEL OPMENT AND REGULATION) ACT, 1951. IN THIS CASE, ACCORDING TO T HE LD. DR, THE ASSESSEE HAS OBTAINED APPROVAL ONLY FROM THE DEVELO PMENT ITA NO. 65/15 :- 3 -: COMMISSIONER OF SPECIAL ECONOMIC ZONE. THEREFORE, THE CIT(A) HAS RIGHTLY CONFIRMED THE DISALLOWANCE U/S 10B OF THE ACT. THE LD. DR FURTHER POINTED OUT THAT THE ASSESSEE HAS NOT MADE ANY CLAIM U/S 10A IN THE RETURN, THEREFORE, THE CLAIM OF THE ASS ESSEE U/S 10A CANNOT BE CONSIDERED AT THIS STAGE. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS ON EITHER SIDE AND ALSO PERUSED THE MATERIAL AVAILABLE ON RECORD. TH E ASSESSEE WAS APPROVED BY DEVELOPMENT COMMISSIONER, SEZ. HOWEVER , EXPLANATION 2(IV) OF SECTION 10B REQUIRES APPROVAL OF THE BOARD APPOINTED BY GOVERNMENT OF INDIA UNDER THE INDUSTRIES (DEVELOPME NT AND REGULATION) ACT, 1951. IN THE ABSENCE OF ANY MATERI AL WITH REGARD TO APPROVAL OF BOARD APPOINTED U/S 14 OF THE INDUSTRI ES (DEVELOPMENT AND REGULATION) ACT, 1951, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CIT(A) HAS RIGHTLY CONFIRMED THE DISALLOWA NCE MADE BY THE ASSESSING OFFICER U/S 10B OF THE ACT. HOWEVER, SU CH A REQUIREMENT IS NOT REQUIRED FOR CLAIMING DEDUCTION U/S 10A OF THE ACT. THEREFORE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE MATTER HAS TO BE EXAMINED U/S 10A OF THE ACT. EVEN THOUGH THE ASS ESSEE HAS NOT MADE ANY CLAIM IN THE RETURN OF INCOME, IN VIEW OF THE FACTS OF THE CASE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION T HAT AS RIGHTLY HELD BY THE HYDERABAD BENCH OF THIS TRIBUNAL IN M/S VSN MAC RO TECHNOLOGIES LTD (SUPRA), THE MATTER NEEDS TO BE CONSIDERED IN T HE LIGHT OF THE ITA NO. 65/15 :- 4 -: PROVISIONS OF SECTION 10A OF THE ACT. A SIMILAR VI EW WAS TAKEN BY THIS TRIBUNAL IN ACIT VS SEVERN GLOCON (INDIA) PVT. LTD IN 2816/MDS/2014, DATED 19.6.2015. IN VIEW OF THE ABOVE, BY FOLLOWIN G THE ORDER OF THIS TRIBUNAL AND FOR THE REASONS STATED THEREIN, THE OR DERS OF THE LOWER AUTHORITIES ARE SET ASIDE AND THE ISSUE IS REMITTED BACK TO THE FILE OF THE ASSESSING OFFICER. THE ASSESSING OFFICER SHA LL EXAMINE THE CLAIM OF THE ASSESSEE U/S 10A OF THE ACT ON MERIT, IN A CCORDANCE WITH LAW, AFTER GIVING A REASONABLE OPPORTUNITY OF HEARING TO THE ASSESSEE. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALLOW ED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON 10 TH OF JULY, 2015, AT CHENNAI. SD/- SD/- ( . !' ) (A. MOHAN ALANKAMONY) # / ACCOUNTANT MEMBER ( . . . ' ) (N.R.S. GANESAN) / JUDICIAL MEMBER #$ / CHENNAI %& / DATED: 10 TH JULY, 2015 RD &' ()*) / COPY TO: 1 . / APPELLANT 4. + / CIT 2. / RESPONDENT 5. ),- . / DR 3. +/' / CIT(A) 6. -01 / GF