THE PR. COMMISSIONER OF INCOME-TAX CIT (A) vs. M/S AUTODESK INDIA PVT LTD.,

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ITA/339/2019HC KarnatakaKAHC01038002201924 September 2024Bench: S.G.PANDIT,C.M. POONACHA5 pages
AI SummaryDismissed

What did the High Court hold?

The High Court disposed of the appeal, granting liberty to the Revenue to revive it if the tax effect falls within exceptions of CBDT circulars. The substantial questions of law were kept open for future adjudication.

What were the facts?

The Revenue appealed against an ITAT order concerning the assessment year 2011-12. The appeal raised substantial questions of law regarding the rejection of comparable companies by the Tribunal.

What were the issues?

Whether the Tribunal was correct in rejecting comparable companies without in-depth analysis of facts and evidence. The appeal was also considered in light of CBDT circulars regarding tax effect.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

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NC: 2024:KHC:39768-DB ITA No. 339 of 2019

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 24TH DAY OF SEPTEMBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO. 339 OF 2019 BETWEEN:

1.

THE PR. COMMISSIONER OF INCOME-TAX CIT (A) 5TH FLOOR, BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU- 560095.

2.

THE ASST. COMMISSIONER OF INCOME TAX CIRCLE 1(1)(1), 2ND FLOOR, BMTC BUILDING, 80 FEET ROAD, KORAMANGALA, BENGALURU- 560095. …APPELLANTS (BY SRI. RAVIRAJ Y. V., ADV. A/W SRI DILIP M., ADV.)

AND:

M/S. AUTODESK INDIA PVT LTD., UNIT A-4, A-WING, 2ND FLOOR, DIVYASHREE CHAMBERS, LANGFORD ROAD, BENGALURU- 560025. PAN: AABCA 6924B. …RESPONDENT (BY SMT. TANMAYEE RAJKUMAR, ADV.)

THIS APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 21.12.2018 PASSED IN IT(TP)A NO.220/BANG/2016, FOR THE

Digitally signed by BHARATHI S Location: HIGH COURT OF KARNATAKA

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NC: 2024:KHC:39768-DB ITA No. 339 of 2019

ASSESSMENT YEAR 2011-2012, PRAYING TO I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE; II. ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE INCOME-TAX APPELLATE TRIBUNAL, BENGALURU IN IT(TP)A NO.220/BANG/2016 DATED 21.12.2018 FOR THE ASSESSMENT YEAR 2011-2012 ANNEXURE-D CONFIRMING THE ORDER OF THE DRP AND CONFIRM THE ORDER PASSED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE- 1(1)(1), BANGALORE AND ETC.

THIS APPEAL, COMING ON FOR ORDER, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER:

CORAM: HON'BLE MR JUSTICE S.G.PANDIT AND HON'BLE MR JUSTICE C.M. POONACHA

ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT)

Heard the learned counsel Sri.Raviraj.Y.V., along with Sri.Dilip.M., learned counsel for appellants/Revenue and learned counsel Smt.Tanmayee Rajkumar for respondent/assessee.

2.

The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short, ‘the Act’) questioning the correctness and legality of order dated 21.12.2018 passed by the Income Tax Appellate Tribunal, ‘C’ Bench, Bengaluru (for short, ‘Appellate

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NC: 2024:KHC:39768-DB ITA No. 339 of 2019

Authority’) in IT(TP)A.No.220/Bang/2016 for the assessment year 2011-12.

3.

This

Court,

admitted the appeal on 18.10.2019 to consider the following substantial questions of law: “1. Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting the comparable companies, M/s. Acropetal Technologies Ltd., M/s. ICRA Techno Analytics Ltd., M/s. Infosys Technologies Ltd., M/s. Tata Elxsi Ltd., M/s. Persistent Systems and Solutions Ltd., and M/s. Persistent Systems Ltd., following the decision of the co-ordinate Bench in the case of Applied Material (I) Private Ltd., in IT(TP)A.No.17 & 39/Bang/2016 without analyzing the facts in depth and ignoring evidence brought on record by TPO?

2.

Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting the comparable companies, M/s. E- Infochips Ltd., and M/s. E-Zest Solutions Ltd., following the decision of the co-ordinate Bench in the case of M/s. Commonscope Networks (I) Pvt. Ltd., in IT(TP)A.No.166 & 181/Bang/2016 without

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NC: 2024:KHC:39768-DB ITA No. 339 of 2019

analyzing the facts in depth and ignoring evidence brought on record by TPO?

3.

Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting M/s. Larsen & Tubro Infotech Ltd., on the grounds of functional dissimilarity without analyzing the facts in depth ignoring evidence brought on record by TPO?

4.

Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in rejecting M/s. ICC International Agencies Ltd., by relying on the decision of the co-ordinate Bench in the case of M/s. Electronic Imaging (I) Pvt. Ltd., vs. DCIT (2017) 85 Taxmann. Com 124 (Bangalore- Trib) without analyzing the facts in depth ignoring evidence brought on record by TPO? ”

4.

Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes. It is also submitted that the aforesaid Circular binds the revenue.

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NC: 2024:KHC:39768-DB ITA No. 339 of 2019

5.

On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under the aforesaid Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024.

6.

In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned counsel for the revenue. However, the question of law is kept open to be adjudicated in an appropriate proceeding.

Sd/- (S.G.PANDIT) JUDGE

Sd/- (C.M. POONACHA) JUDGE

MPK CT:bms List No.: 2 Sl No.: 0

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