DCIT, Bangalore V. M/s Zenith Software Ltd., Bangalore

ITA 723/BANG/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0636 (ITAT-BANGALORE)
• Duration Of Justice: 4 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-11-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 11-11-2009
• Assessment Year: 2005-2006
• Appeal Filed On: 20-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SWATHI S PATIL
• Assessee Lawyers: SRINIVASAN
• Section: 143(1); 10

Judgement Text

ITA NO.723/B/09 1 IN THE INCOME TAX APPELLATE TRIBUNA L, BANGALORE BENCH B BEFORE SHRI K P T THANGAL, VICE PRESIDENT AND SHRI A MOHAN ALANKAMONY, A.M ITA NO.723/BANG/2009 (ASSESSMENT YEAR 2005-06) THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-12(5), BANGALORE-1. - APPELLANT VS M/S ZENITH SOFTWARE LIMITED, #4, INDL. LAYOUT, KORAMANGALA, BANGALORE-95. - RESPONDENT APPELLANT BY : SMT. SWATHI S PATIL RESPONDENT BY : SHRI SRINIVASAN ORDER PER K P T THANGAL : THIS APPEAL BY THE REVENUE IS FOR THE ASST. YEAR 2 005- 06. THE ASSESSEE HAS TAKEN AS MANY AS FOUR GROUNDS . THE EFFECTIVE GROUND IS AGAINST THE ORDER OF THE CIT(A) IN DIRECTING THE ASSESSING OFFICER TO EXCLUDE THE EXPENDITURE INCURR ED TOWARDS FREIGHT, TELECOMMUNICATION CHARGED, ETC. FROM THE T OTAL TURNOVER FOR THE PURPOSES OF COMPUTATION OF DEDUCTION U/S 10 A OF THE I T ACT, 1961. 2. THE ASSESSEE FILED THE RETURN ON 29TH OCTOBER, 2005 FOR THE ASST. YEAR UNDER CONSIDERATION DECLARING NIL INCOME AND ITA NO.723/B/09 2 CLAIMED DEDUCTION OF RS. 1,86,90,539/- U/S 10A OF T HE ACT. THE RETURN WAS PROCESSED U/S 143(1) AND REFUND WAS GRAN TED AT RS.2,84,038/-. THE ASSESSEE REDUCED THE EXPORT TUR NOVER AFTER THE DEDUCTION OF RS.1,09,84,464/-, BEING TELECOMMUN ICATION AND FOREIGN TRAVELING CHARGES, HAS EXCLUDED THE EXPENDI TURE FROM THE TOTAL TURNOVER. THE ASSESSING OFFICER REJECTED THE CLAIM OF THE ASSESSEE AND REDUCED RS.1,62,53,756/- RESORTING TO SECTION 10A FOLLOWING EXPLANATION 2 TO SECTION 10A. 3. WHEN THE MATTER WAS TAKEN UP FOR HEARING, THE CONTENDING PARTIES CONCEDED THAT THE ISSUE IS COVER ED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE TRIBUNAL, SPECIA L BENCH IN THE CASE OF ITO V SAK SOFT LTD. 313 ITR (AT) 353 (CHENN AI) WHEREIN THE TRIBUNAL HELD THAT EXPENSES ON FREIGHT, TELECOM MUNICATION CHARGES OR INSURANCE ATTRIBUTABLE TO THE DELIVERY OF THE ARTICLES OR THINGS OR COMPUTER SOFTWARE OUTSIDE INDIA OR EXPENS ES INCURRED IN FOREIGN EXCHANGE IN PROVIDING TECHNICAL SERVICES OU TSIDE INDIA, WHICH ARE REQUIRED TO BE EXCLUDED FROM THE EXPORT T URNOVER. IN VIEW OF THE ABOVE, RESPECTFULLY FOLLOWING THE ABOVE DECISION, THE APPEAL BY THE REVENUE IS DISMISSED. 4. IN THE RESULT, THE APPEAL BY THE REVENUE IS DISM ISSED. PRONOUNCED IN THE OPEN COURT ON 20TH NOVEMBER, 2009 . SD/- SD/- (A MOHAN ALANKAMONY) (K P T THANGAL) ACCOUNTANT MEMBER VICE PRESIDENT BANGALORE, DATED :20/11/2009 ITA NO.723/B/09 3 COPY TO : 1. THE REVENUE 2. THE ASSESSEE 3. THE CIT CONCERNED. 4. THE CIT(A) CONCERNED. 5. DR 6. GF 7. GF, ITAT, NEW DELHI. MSP/17/11/ BY ORDER ASST. REGISTRAR, ITAT, BANGALORE.