Altair Engineering India (P) Ltd., Bangarpet V. DCIT, Bangalore

ITA 762/BANG/2010

• Counselvise Citation: [2011] 135 COUNSELVISE.COM (IT) 1617 (ITAT-BANGALORE)
• Duration Of Justice: 7 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-01-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 08-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SWATHI S PATIL CITIIDR
• Assessee Lawyers: H V GOWTHAMA
• Section: 80HHC; 10B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER ITA NO. 762/BANG/2010 ASSESSMENT YEAR : 2005-06 ALTAIR ENGINEERING INDIA (P.) LTD., MERCURY 2B BLOCK, 5 TH FLOOR, PRESTIGE TECH PARK, SARJAPUR, MARATHAHALLI OUTER RING ROAD, BANGALORE 560 027. : APPELLANT VS. THE DY. COMMISSIONER OF INCOME-TAX, CIRCLE 11(1), BANGALORE. : RESPONDENT APPELLANT BY : SHRI H.V. GOWTHAMA, C.A. RESPONDENT BY : SMT. SWATHI S. PATIL, CIT-II(DR) O R D E R PER A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER THIS APPEAL IS FILED BY THE ASSESSEE AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS) IN ITA NO.78/DC-11(1)/09-09 DATED 28.0 4.2010 FOR THE ASSESSMENT YEAR 2005-06. 2. THE ASSESSEE HAS RAISED SIX ELABORATE GROUNDS BE FORE US. HOWEVER, THE CRUX OF THE ISSUE INVOLVED IS DISALLOW ANCE U/S. 10A OF THE ACT BY THE LD. DY.CIT, WHICH WAS FURTHER CONFIRMED BY T HE LD. CIT(APPEALS). ITA NO.762/BANG/10 PAGE 2 OF 5 3. THE LD. AO HAD DISALLOWED DEDUCTION U/S. 10A OF THE ACT FOR THE A.Y. 2005-06 DUE TO THE FOLLOWING REASONS : (1) THE ASSESSEE WAS CLAIMING DEDUCTION U/S. 80HHC (SIC) 80HHE UPTO THE A.Y. 2003-04. HOWEVER, FROM A.Y. 2004-05, THE ASSESSEE HAD CLAIMED DEDUCTION U/S. 10A. (2) THE ASSESSEE HAS NOT ENCLOSED THE STPL CERTIFIC ATE. (3) THERE WAS NO CHANGE IN THE ASSESSEES BUSINESS ACTIVITIES FROM THE PAST ASSESSMENT YEARS. (4) THERE IS NO PROVISION IN THE ACT ENTITLING THE ASSESSEE TO CLAIM DEDUCTION U/S. 10A OR SECTION 80HHE AT ITS OPTION I N DIFFERENT ASSESSMENT YEARS FALLING WITHIN THE CONCERNED BLOCK OF TEN ASSESSMENT YEARS. THE DECISION REPORTED IN 254 IT R 24 DOES NOT SUPPORT THE CASE OF THE ASSESSEE, SINCE IT WAS DECIDED IN THE CONTEXT OF SECTION 80J OF THE I.T. ACT AND THEREFOR E NOT APPLICABLE TO THE FACTS OF THE ASSESSEES CASE. (5) CIRCULAR NO.1 OF 2005 DATED 6.1.2005 WHICH DEAL S WITH TAX HOLIDAY UNDER SECTION 10B OF THE I.T. ACT WILL NOT RESCUE TO THE ASSESSEES CLAIM FOR THE FACTS OF THE ASSESSEE ARE CLEARLY DISTINGUISHABLE. 4. ON APPEAL BEFORE THE CIT(APPEALS) BY THE ASSESSE E, LD. CIT(APPEALS) HELD IT WAS MANDATORY FOR THE ASSESSEE TO PRODUCE BEFORE THE REVENUE THE CERTIFICATE GRANTING APPROVAL BY THE ST P. IN THE INSTANT CASE FOR THE A.Y. 2005-06, THE A.O AT THE TIME OF ASSESS MENT PROCEEDINGS HAD ASKED FOR THE COPY OF STPI APPROVAL LETTER FROM THE ASSESSEE WHICH WAS NOT ITA NO.762/BANG/10 PAGE 3 OF 5 PRODUCED. EVEN AT THE APPELLATE STAGE, ON BEING ASK ED FOR SUCH APPROVAL THE ARS REPLY WAS THAT THE CERTIFICATE OF THE AUDI TOR IN FORM 56F WILL SUFFICE TO MAKE THE ASSESSEE ENTITLED FOR DEDUCTION U/S.10A /10B OF THE ACT. THEREFORE ON THE GROUND OF NON-PRODUCTION OF THE LE TTER GRANTING APPROVAL BY THE STP LD.CIT(A) UPHELD THE ORDER OF THE LD.AO DISMISSING THE APPEAL OF THE ASSESSEE. 5. LD. AR SUBMITTED BEFORE US THAT THE APPELLANT HA D SUBMITTED ALL THE DETAILS CALLED FOR BY THE AO INCLUDING THE APPROVAL LETTER FROM THE STP DT. 5/01/1999 VIDE ITS LETTER TO THE REVENUE NO. GC/525 /2008 DT. 21.10.2008. LD. AR ALSO POINTED OUT THAT THE LD. AO HAD NOT MAD E ANY REMARK RELATING TO NON SUBMISSION OF CERTIFICATE FROM STP. LD. AR C ONTENDED THAT THE LD.CIT(A) HAD ALSO NOT ASKED THESE DOCUMENTS TO BE PRODUCED BEFORE HIM AT THE TIME OF APPELLATE PROCEEDINGS. HOWEVER, ALL THESE CERTIFICATES WERE BEFORE THE REVENUE AT THE TIME OF ASSESSMENT AND AP PELLATE PROCEEDINGS. LD. AR FURTHER SUBMITTED THAT THE ITAT IN THE APPEL LANTS OWN CASE IN ITA NO.1350/BANG/2008 DATED 3.7.2009 HAD ANNULLED THE O RDER PASSED BY THE CIT U/S. 263 FOR THE A.Y. 2004-05 WITH A CLEAR FIND ING ON THE DEDUCTIBILITY U/S. 10A OF THE ACT. 6. LD. DR VEHEMENTLY SUPPORTED THE ORDER OF THE CIT (A) AND LD. AO. LD. DR FURTHER ARGUED THAT THE HONBLE ITAT IN ITS ORDER DATED 3.7.2009 DID NOT HAVE THE OPPORTUNITY TO EXAMINE THE DEDUCTIBILI TY U/S. 10A OF THE ACT SINCE IT WAS ONLY THE ORDER PASSED BY THE CIT U/S. 263 OF THE ACT BEFORE IT FOR CONSIDERATION, WHEREIN IT WAS HELD THAT THE ORD ER OF THE AO IS IN ORDER WHICH REQUIRED NO INTERFERENCE BY INVOKING THE PROV ISIONS OF SECTION 263 OF THE ACT. LD. DR SUBMITTED THAT THE LD. CIT(A) HAD CONSIDERED ALL THE ISSUES ITA NO.762/BANG/10 PAGE 4 OF 5 REGARDING THE DEDUCTIBILITY U/S. 10A OF THE ACT IN HIS ORDER FOR THE A.Y. 2005- 06 AND HAD JUDICIOUSLY ARRIVED AT A CONCLUSION THAT THE ASSESSEE DISENTITLES THE CLAIM OF DEDUCTION U/S. 10A OF THE I.T. ACT. IT WAS PRAYED THAT THE ORDER OF THE LD. CIT(A) MAY BE SUSTAINED. 7. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIALS ON RECORD CONTAINING PAGES 1 TO 29 SUBMITTED BY THE AS SESSEE. THE ONLY FACTS EMANATING FROM THE LD. AOS ORDER IS THAT THE ASSES SEE HAD NOT ENCLOSED THE STP I APPROVAL CERTIFICATE AND THAT THERE IS NO PROVISION IN THE ACT ENTITLING THE ASSESSEE TO CLAIM DEDUCTION U/S. 10A OF THE ACT OR SECTION 80HHE OF THE ACT AT ITS OPTION IN DIFFERENT ASSESSM ENT YEARS FALLING WITH THE CONCERNED BLOCK OF TEN ASSESSMENT YEARS. ON PERUSI NG THE ORDER OF THE LD. CIT(A)S ORDER ALSO, THE ONLY ISSUE BROUGHT OUT IS THAT THE ASSESSEE HAD NOT PRODUCED THE CERTIFICATE ISSUED BY STP I FOR GRANT OF APPROVAL. AT THIS JUNCTURE, IN THE INTEREST OF JUSTICE, WE ARE OF THE CONSIDERED VIEW THAT THE ASSESSEE SHOULD BE PROVIDED WITH ONE MORE OPPOR TUNITY TO PRODUCE THE REQUISITE STP I CERTIFICATE BEFORE THE LD. AO FOR HIM TO EXAMINE AND DETERMINE WHETHER THE ASSESSEE IS ENTIT LED TO DEDUCTION U/S. 10A OF THE ACT. NEEDLESS TO MENTION THAT IF THE ASSESSEE COMPLIES WITH THE PROVISIONS U/S. 10A OF THE ACT, T HE ASSESSEE SHALL NOT BE DENIED THE BENEFIT UNDER THE ACT. IT IS ORDERED ACCORDINGLY. WE ALSO BRING ON RECORD THAT THE ASSESSEE HAS SUBMITTE D THE LETTER GRANTING APPROVAL BY STP I BEFORE US IN PAGE 25 TO 27 OF THE PAPERBOOK. 8. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS ALL OWED FOR STATISTICAL PURPOSES. ITA NO.762/BANG/10 PAGE 5 OF 5 PRONOUNCED IN THE OPEN COURT ON THIS 21 ST DAY OF JANUARY, 2011. SD/- SD/- ( SMT. P. MADHAVI DEVI ) (A. MOHAN ALANKAMONY ) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 21 ST JANUARY, 2011. DS/- COPY TO: BY ORDER ASSISTANT REGISTRAR ITAT, BANGALORE. 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE