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Income Tax Appellate Tribunal, “K” BENCH, MUMBAI
This appeal by the Revenue is arising out of the order of Commissioner of Income Tax (Appeals)-18, Mumbai, [in short CIT(A)] in appeal No. CIT(A)-18/IT-29/ITO-11(2)(2)/15-16 dated 30-12-2016. The Assessment was framed by the Deputy Commissioner of Income Tax, CC,11(2)(1), Mumbai (in short DCIT) for the assessment year 2011-12 order dated 17.03.2015 under section 143(3) read with section 144C(5) of the Income Tax Act, 1961(hereinafter ‘the Act’).
The only issue in this appeal of Revenue is against the order of CIT(A) allowing the claim of deduction under section 10A of the Act on interest by treating the same as profit derive from export of computer software. For this Revenue has raised the following grounds: - “
i) 0n the facts and circumstances of the case and in law, the CIT(A) has erred in allowing the deduction u/s.10A of the I.T Income-tax Act. 1961 ignoring the fact that the assessee had not claimed the same in the validly filed return of income and as such scrutiny assessment proceedings are not meant for the admission of fresh claim benefiting the assessee.' ii) On the facts and circumstances of the case and in law, the CIT(A) has erred in allowing interest income of Rs 28,84,58,703/- as profits eligible for deduction u/s.1OA & 10AA of the Act without appreciating the fact that the said income was not derived from export of computer software and hence was not eligible for deduction under the said sections?" iii) 0n the facts and circumstances of the case and in law, the CIT(A) has erred in not appreciating the ratio of the judgment of the Hon’ble Apex Court in the case of Liberty India Ltd. Vs CIT (317 ITR 218) wherein it is held that though certain income may constitute profit from business u/s 28, yet the same cannot be construed as profits derived from an industrial undertaking and hence would not be eligible for deduction u/s 10A/10AA of the Act'?' iv) on the facts and circumstances of the case and in law, the CIT(A) has erred in allowing interest income earned from EEFC account as profits eligible for deduction u/s.10A & 10AA of the Act relying upon the decision of ITAT in assessee's own case without appreciating that Hon'ble Bombay High Court in the case of CIT Vs Shah Originals (327 ITR
19. (2010) had categorically held that the interest accrued to the assessee on the deposits held in EEFC account falls for classification as income from other sources and cannot be treated as business income ?" v) On the facts and circumstances of the case and in law, whether the CIT(A) was correct in relying upon its own decision in the assessee's case for assessment years 2004-05 to 2010-11 and Hon'ble Tribunals decision for the assessment years 1997-98 to 2009-10 which has not accepted by the Department on merits which was pending before the ITAT and Nigh Court for adjudication.?.”
3. Briefly stated facts are that the assessee has claimed deduction under section 10A and 10AA and also filed form No. 56F in respect of the same. The assessee company has earned interest income of ₹ 28,84,58,703/- and claimed the same in the nature of business income eligible for deduction us/ 10A of the Act. We find that the CIT(A) following Tribunals decision in assessee’s own case for previous assessment years and allowed the claim of the assessee by observing in Para 2.5 as under: - “2.5 I have considered the submissions of the appellant, order of the Assessing Officer and facts of the case carefully. It is noticed that this issue has been decided by the Hon’ble Tribunal in favour of appellant for AY for 1997-98, AY 1998-99, AY 1999-2000, AY 2000-01, AY 2001- 02, AY 2002-03, AY 2003-04, AY 2004-05, AY 2005-06, AY 2006-07, AY 2007-08, AY 2008-09 and AY 2009-10 and the CIT(A) held in favour of the appellant for AYs. 2004-05 to 2010-11.
Since the issue has already been decided by the Ld. CIT(A) and the Hon’ble Tribunal in favour of the appellant and as there is no change in facts and law, therefore, respectfully following the same, the ground of appeal is allowed.”
Aggrieved, Revenue came in appeal before Tribunal.
At the outset, the learned Counsel for the assessee filed Tribunal’s order in assessee’s own case for AY 2009-10 in vide order dated 26.08.2016, wherein similar issue was allowed by following the earlier years decision by observing as under:-
“2. The only issue in appeal is regarding allowability of interest income of Rs.14,26,60,079/- as profits eligible for deduction u/s.10A/10B of the Act. ITAT Mumbai ‘E’ Bench in case of State Street Syntel Services Private Limited vs. DCIT in by following assessee’s own case for A.Y.2009-10 on similar issue held as under:
“7. No material difference in fact for the impugned assessment year has been brought to our notice by the Learned Departmental Representative. Therefore, respectfully following the decision of the co-ordinate bench rendered in assessee's own case referred to above, we allow assessee's claim of deduction under section 10A. However, it is observed that the Assessing Officer had disallowed claim of deduction under section 10A for an amount of Rs.1,17,23,282, being the interest income, whereas, as per the ground of appeal raised before us and the order of the learned Commissioner (Appeals), the interest income referred to therein is Rs.1,70,23,282. The Assessing Officer is directed to allow assessee's claim of exemption under section 10A after verifying the exact amount of interest income.
There being no material difference in facts brought to our notice by the learned Departmental Representative, respectfully following the consistent view of the Tribunal in assessee's own case, we allow assessee's claim of deduction under section 10A in respect of interest income of Rs.4,46,09,912. Ground raised by the assessee is allowed.”
2.1 Nothing contrary was brought to our knowledge on behalf of Revenue. Facts being similar, so following same reasoning, we allow the assessee’s claim of deduction u/s.10A of the Act in respect of interest income as raised by assessee.”
2.1 Nothing contrary was brought to our knowledge on behalf of Revenue. Facts being similar, so following same reasoning, we are not inclined to interfere with the order of CIT(A) who has allowed the assessee’s claim by allowing interest income of Rs.14,26,60,079/- as eligible profit for deduction u/s.10A/10B of the Act.”
As the issue is squarely covered in favour of assessee by Tribunal’s decision in assessee’s own case, respectfully following the same, we dismiss the appeal of Revenue and confirmed the order of CIT(A).
In the result, the appeal of Revenue is dismissed. Order pronounced in the open court on 14-06-2018.