Deputy Commissioner Of Income Tax,Circle- 4(1)(2), Bangalore V. M/s. Microchip Technology (India) Private Limited, Bangalore

MA 58/BANG/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4780 (ITAT-BANGALORE)
• Duration Of Justice: 7 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 16-10-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 10-03-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PRIYADARSHI MISHRA
• Assessee Lawyers: T SURYANARAYANA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORE SHRI A.K GARODIA, ACCOUNTANT MEMBER AND SMT. BEENA PILLAI, JUDICIAL MEMBER M.P NO.58/BANG/2020 (IN IT(TP)A NO.276/BANG/2014) M.P NO.88/BANG/2020 (IN IT(TP)A NO.187/BANG/2014 ASSESSMENT YEAR : 2009-10 THE DY. COMMISSIONER OF INCOME-TAX, CIRCLE-4(1)(2), BANGALORE. VS. M/S MICROCHIP TECHNOLOGIES (INDIA) PVT. LTD., NO.149-B, EPIP I PHASE, INDUSTRIAL AREA, WHITEFIELD, BANGALORE-560 066. PAN AABCM 9868 J APPELLANT RESPONDENT APPELLATE BY : SHRI PRIYADARSHI MISHRA, JCIT RESPONDENT BY : SHRI T SURYANARAYANA, ADVOCATE DATE OF HEARING : 25-09-2020 DATE OF PRONOUNCEMENT : 16-10-2020 ORDER PER BEENA PILLAI, JUDICIAL MEMBER PRESENT MISCELLANEOUS PETITION HAS BEEN FILE D BY REVENUE SEEKING RECTIFICATION OF CERTAIN ALLEGED MI STAKES IN ORDER DATED 28/09/2019 PASSED BY THIS TRIBUNAL IN AFORESTATED MATTER. PAGE 2 OF 7 M.P NO.55 & 88/BANG/2020 2. LD.SR.DR SUBMITTED THAT REVENUE HAS FILED MISCELLANEOUS PETITION BEING MP NO. 58/B/2020 WHICH REVENUE WISHES TO WITHDRAW. LD. SENIOR DR HAS FILED FOLLOWING LETTER DATED 16/09/2019 WHEREIN THE DEFEC TIVE MISCELLANEOUS PETITION HAS BEEN STATED TO BE WITHDR AWN. THE LETTER DATED 16/09/2020 IS CANDID REPRODUCED AS UND ER: -----SPACE LEFT INTENTIONALLY------- PAGE 3 OF 7 M.P NO.55 & 88/BANG/2020 PAGE 4 OF 7 M.P NO.55 & 88/BANG/2020 ACCORDINGLY WE ALLOW MISCELLANEOUS PETITION NO. 58/B/2020 TO BE WITHDRAWN. 3. LD.SR.DR SUBMITTED THAT, MISCELLANEOUS PETITION NO. 88 IS FILED AGAINST ORDER IN ITA (TP) A NO. 276/B ANGE L/2014 BEING ASSESSEES APPEAL. HE SUBMITTED THAT THIS TRIBUNAL PASSED CONSOLIDATED ORDER IN CROSS APPEALS FILED BY ASSESSEE, AS WELL AS REVENUE. THE ONLY ISSUE RAISED BY REVENU E IS REGARDING: A) ADMITTING ADDITIONAL GROUND ON THE ISSUE OF ESOP B) RELIEF GRANTED TO ASSESSEE TO THE EXTENT OF RS.38,4 8,096/- BEING ESOP EXPENDITURE IS ATTRIBUTABLE FOR YEAR UNDER CON SIDERATION. 4. ON THE 1 ST ISSUE, THE VIEW TAKEN BY THIS TRIBUNAL IN ADMITTING THE ADDITIONAL GROUND HAS BEEN FOUND TO B E BORNE TO OF RECORDS AND THAT THIS TRIBUNAL WAS CONVINCED THAT, NO NEW FACTS NEEDS TO BE VERIFIED FOR DECIDING THE ISS UE RAISED. IT WAS UNDER SUCH CIRCUMSTANCES THAT THIS TRIBUNAL ADMITTED THE ADDITIONAL GROUND RAISED BY ASSESSEE VIDE APPLI CATION DATED 05/12/2016. WE ALSO NOTED THAT, THIS ISSUE WA S RAISED BY ASSESSEE BEFORE DRP AS WELL AS LD. AO/TPO AND TH AT NO NEW FACTS NEEDS TO BE LOOKED INTO TO DISPOSE IT. TH E VIEW OF ADMITTING THE ADDITIONAL GROUND WAS A CONSCIOUS DEC ISION BASED ON THE FACTS AND RECORDS PLACED BEFORE US. WE THEREFORE DO NOT FIND ANY MERIT IN THE GRIEVANCE OF REVENUE RAISED IN M.P. 5. IN RESPECT OF ISSUE OF GRANTING RELIEF TO ASSESS EE TO THE EXTENT OF RS.38,48,096/- BEING ESOP EXPENDITURE ATTRIBUTABLE FOR YEAR UNDER CONSIDERATION, WE NO TE THAT, LD.TPO WHILE COMPUTING OPERATING EXPENSES, EXCLUDED TOTAL SUM OF RS.2,57,08,603/- PERTAINING TO STOCK OPTION FOR PAGE 5 OF 7 M.P NO.55 & 88/BANG/2020 EMPLOYEES DURING THE YEAR. LD.TPO WAS OF THE VIEW T HAT, THESE WERE NON OPERATING EXPENSES FOR DETERMINING M ARGIN OF ASSESSEE. BEFORE US, LD.AR SUBMITTED THAT THESE WER E TO BE CONSIDERED AS EXPENDITURE AS HAS BEEN HELD BY S PECIAL BENCH OF THIS TRIBUNAL IN CASE OF BIOCON LTD REPORTED IN 115 TTJ 649 . LD.AR AT THE TIME OF HEARING SUBMITTED THAT, AMOUNT PAID DURING THE YEAR WAS RS.38,48,096/- CANN OT BE DENIED AS EXPENDITURE. HE HAD PLACED RELIANCE ON DE CISION OF HONBLE DELHI HIGH COURT AND HONBLE MADRAS HIGH COURT IN CASE OF CIT VS LEMON TREE HOTELS LTD IN ITA NO.107/2015 AND CIT VS PVP VENTURES LTD REPORTED IN (2012) 23 TAXMANN.COM 286 RESPECTIVELY, IN SUPPORT OF HIS CONTENTION. BEFORE US, AT THE TIME OF HEARING, LD.SR.DR COULD N OT BRING ANY CONTRARY VIEW BY ANY OF HONBLE SUPREME COURT OR HONBLE HIGH COURTS ON THIS ISSUE TO ESTABLISH A MISTAKE APPARENT ON RECORD. WE THEREFORE DENY INTERFERING W ITH THE VIEW TAKEN BY THIS TRIBUNAL IN ORDER DATED 28/08/2019. ACCORDINGLY, ISSUES ALLEGED BY REVENUE IN PRESENT MISCELLANEOUS PETITION NO.88/BANG/2020 STANDS DISMISSED. IN THE RESULT MISCELLANEOUS PETITION FILED BY REVEN UE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 16 TH OCT, 2020. SD/- SD/- (A.K GARODIA) (BEENA PILLAI) ACCOUNTANT MEMBER JUDICIAL MEMBER BANGALORE, DATED, THE 16 TH OCT, 2020. /VMS/ PAGE 6 OF 7 M.P NO.55 & 88/BANG/2020 COPY TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE 6. GUARD FILE BY ORDER ASSISTANT REGISTRAR, INCOME-TAX APPELLATE TRIBUNAL. BANGALORE. PAGE 7 OF 7 M.P NO.55 & 88/BANG/2020 DATE INITIAL 1. DRAFT DICTATED ON ON DRAGON SR.PS 2. DRAFT PLACED BEFORE AUTHOR -10-2020 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER -10-2020 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. -10-2020 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS -10-2020 SR.PS/PS 6. KEPT FOR PRONOUNCEMENT ON -10-2020 SR.PS 7. DATE OF UPLOADING THE ORDER ON WEBSITE -10-2020 SR.PS 8. IF NOT UPLOADED, FURNISH THE REASON -- SR.PS 9. FILE SENT TO THE BENCH CLERK -10-2020 SR.PS 10. DATE ON WHICH FILE GOES TO THE AR 11. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 12. DATE OF DISPATCH OF ORDER. 13. DRAFT DICTATION SHEETS ARE ATTACHED NO SR.PS