THE COMMISSIONER OF INCOME-TAX V. M/S. BUSINESS PROCESS

ITA/668/2015

AI Insights

The case involves an appeal by the Revenue against the decision of the Income Tax Appellate Tribunal (ITAT), which directed the assessing officer to recompute the deduction under section 10A of the Income Tax Act. The main contention was whether expenses that were reduced only from export turnover should also be reduced from the total turnover, despite the specific provisions of section 10AA. The Tribunal's decision relied on a previous High Court decision in Tata Elxsi Ltd, which was under challenge in the Supreme Court. The Revenue argued that the matter was pending before the Apex Court, and thus the High Court's decision should not be considered final.

• Counselvise Citation: [2016] 140 COUNSELVISE.COM (IT) 728568 (HC-KARNATAKA)
• Appeal Type: Others
• Pronouncement Date: 31-03-2016
• Assessment Year: misc
• Other Referred Cases: Tata Elxsi Ltd 349 ITR 98(KAR)
• Laws Referred To: Income Tax Act 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: E I SANMATHI
• Assessee Lawyers: K V ARAVIND
• Keywords: Deduction under Section 10A; Export Turnover; Income tax appeal; Total Turnover; Pending SLP
• Section: 10AA; 10A; 260-A

Judgement Text

" 1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 31ST DAY OF MARCH 2016 PRESENT THE HON’BLE MR.JUSTICE JAYANT PATEL AND THE HON’BLE MRS.JUSTICE B.V.NAGARATHNA INCOME TAX APPEAL NO.*668/2015 BETWEEN: 1. THE COMMISSIONER OF INCOME-TAX 5TH FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BANGALORE – 560 095. 2. THE INCOME-TAX OFFICER WARD-11(1) 2ND FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BANGALORE – 560 095. ... APPELLANTS (BY SRI.K.V.ARAVIND, STANDING COUNSEL) AND: M/S. BUSINESS PROCESS OUTSOURCING (INDIA) PVT. LTD., TOWER 2D, VRINDAVAN TECH VILLAGE, In view of the order passed on 19.08.2016, earlier order dated 31.03.2016 is withdrawn and fresh order is passed separately in ITA No.668/2016. The order passed in ITA No.668/15 c/w ITA No.678/15 on 31.03.2016 is kept for record purpose. * Separate order is passed vide Court order dated 19.08.2016 2 DEVARABEESANAHALLI, ORR, BANGALORE – 560 037 PAN: AABCB 5293N ... RESPONDENT THIS INCOME TAX APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED:24/07/2015 PASSED IN ITA NO. 677/BANG/2012 FOR THE ASSESSMENT YEAR 2007- 2008 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE AND ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE ITAT, BENGALURU IN ITA NO. 677/BANG/2012 DATED:24/07/2015 AND CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE INCOME TAX OFFICER, WARD-11(1), BENGALURU. THIS APPEAL COMING ON FOR ADMISSION THIS DAY, JAYANT PATEL J., DELIVERED THE FOLLOWING: JUDGMENT The appellant-Revenue has preferred this appeal by raising the following substantial questions of law: “1. Whether the Tribunal is justified in directing the assessing officer to recomputed the deduction under section 10A after reducing those expenses that were reduced only from export turnover, to reduce from 3 the total turnover also, without appreciating that there is no provision in section 10AA to the effect that such expenses should also be reduced from the total turnover, as clause (iv) of the Explanation to Section 10A provides that such expenses have to be reduced only from the export turnover? 2. Whether the Tribunal was justified, on the facts and in the circumstances of the case, in allowing relief to the assessee relying on the decision of the Hon’ble High Court of Karnataka which has not reached its finality and SLP has been filed against such order on this issue in the case of Tata Elxsi Ltd 349 ITR 98(KAR)? 2. Learned counsel appearing for the appellant- Revenue Mr.K.V.Aravind as well as Sri E.I.Sanmathi concede that the issue is as such covered by Tata Elxsi Ltd 349 ITR 98(KAR). However, they submit that the matter is carried before the Apex Court and SLP is pending. 3. In our view, when the issues are already covered by the decision of this Court, it cannot be said 4 that any substantial questions of law would arise for consideration. 4. Hence, the present appeal deserves to be dismissed but with an observation that, in the event, the Apex Court takes a different view, the Revenue may be at liberty to take appropriate action in accordance with law. 5. Subject to the abovesaid observation, the appeal is dismissed. Sd/- JUDGE Sd/- JUDGE Sk/- "