DCIT, Circle-17(2), Hyderabad, Hyderabad V. Virtusa (India) Private Limited, Hyderabad, Hyderabad

ITA 914/HYD/2017

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 2491 (ITAT-HYDERABAD)
• Duration Of Justice: 9 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-02-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2009-2010
• Appeal Filed On: 26-05-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: DR K SRINIVAS REDDY

Judgement Text

THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH A, HYDERABAD BEFORE SMT P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA NO. 914/HYD/2017 ASSESSMENT YEAR: 2009-10 THE DY COMMISSIONER OF INCOME TAX, CIRCLE-17(2), HYDERABAD. VS. M/S. VIRTUSA (INDIA) PRIVATE LIMITED, HYDERABAD. PAN- AABCV4077E (APPELLANT) (RESPONDENT) REVENUE BY : DR. K. SRINIVAS REDDY ASSESSEE BY : SHRI RAVI BHARADWAJ DATE OF HEARING : 14-02-2018 DATE OF PRONOUNCEMENT : 28-02-2018 ORDER PER P. MADHAVI DEVI, J.M.: IN THIS APPEAL THE REVENUE IS AGGRIEVED BY THE ORDER OF THE CIT(A)-5, HYDERABAD DATED 20.03.2017. 1. THE LD. CIT(A) IS ERRONEOUS IN LAW AND ON THE FACTS OF THE CASE. 2. THE LD. CIT(A) ERRED IN HOLDING THAT THE AMOUNT OF STATURY DISALLOWANCE HAS TO BE CONSIDERED AS BUSINESS PROFIT ELIGIBLE FOR DEDUCTION U/S 10A. 3. THE LD. CIT(A) ERRED IN DIRECTING TO REDUCE COMMUNICATION EXPENSES, INSURANCE AND EXPENSES REIMBURSED BOTH FROM THE EXPORT TURNOVER AND THE TOTAL TURNOVER TO DETERMINE THE QUANTUM OF EXEMPTION U/S 10A IGNORING THE FACTS THAT SLP WAS FILED BY THE DEPARTMENT VIDE SLP (CIVIL) CC NO. 15057 OF 2014, ON IDENTICAL ISSUE IN ASSESSEES OWN CASE OF THE A.Y 2006-07. 4. ANY OTHER GROUND THAT MAY BE URGED AT THE TIME OF HEARING. 2. AT THE TIME OF HEARING, THOUGH THE LD. DR SUPPORTED THE ORDER OF THE A.O, HE FAIRLY ADMITTED THAT THE ISSUE IS COVERED IN FAVOUR OF THE ASSESSEE BY THE DECISION OF THE 2 ITA NO. 914/HYD/2017 M/S VIRTUSA (INDIA) PVT LTD., HYDERABAD. HONBLE KARNATAKA HIGH COURT IN THE CASE OF TATA ELXSI LTD., AND OTHERS (2011) 247 CTR 334 (KARNATAKA) AND ALSO THE DECISION OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF ASSESSEES OWN CASE FOR THE A.Y. 2006-07, WHEREIN IT WAS HELD THAT IF ANY EXPENDITURE INCLUDED FROM THE EXPORT TURNOVER, THEN THE SAME HAS TO BE EXCLUDED FROM THE TOTAL TURNOVER AS WELL. WE FIND THE CIT(A) HAS FOLLOWED THE PRECEDENTS ON THE ISSUE IN ALLOWING RELIEF TO THE ASSESSEE FOR COMPUTING THE DEDUCTION U/S 10A OF THE ACT. IN VIEW OF THE SAME, WE DO NOT FIND ANY MERIT IN THE REVENUES APPEAL AND IT IS ACCORDINGLY DISMISSED. 3. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED PRONOUNCED IN THE OPEN COURT ON 28 TH FEBRUARY, 2018. SD/- SD/- (S. RIFAUR RAHMAN) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DATED: 28 TH FEBRUARY, 2018 KRK 1 2 M/S VIRTUSA (INDIA) PVT LTD., 6-3-1192, BLOCK-A, 3 RD FLOOR, MY HOME TYCOON, KUNDANBAGH, BEGUMPET, HYDERABAD-16. THE DY CIT, CIRCLE-17(2), HYDERABAD 3 THE COMMISSIONER OF INCOME TAX (A)-5, HYDERABAD. 4 5 THE PR. COMMISSIONER OF INCOME TAX-5, HYDERABAD. THE DR, ITAT HYDERABAD 6 GUARD FILE