DCIT CORPORATE CIRCLE 3(2), CHENNAI vs. VERIZON DATA SERVICES INDIA PVT. LTD., CHENNAI

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ITA 2401/CHNY/2017Status: DisposedITAT Chennai26 February 2018AY 2008-093 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the CIT(A)'s order, following the Hon'ble Karnataka High Court's decision in CIT vs. Tata Elxi Ltd. This decision stated that expenditure excluded from export turnover in the numerator must also be excluded from total turnover in the denominator for Section 10A calculations.

What were the facts?

The Revenue appealed against the CIT(A)'s order directing a reduction in expenditure excluded from export turnover, also from total turnover, for calculating deduction under Section 10A. The Revenue argued that the CIT(A) relied on a Special Bench decision which was under appeal before the High Court.

What were the issues?

Whether expenditure excluded from export turnover should also be excluded from total turnover when calculating deduction under Section 10A.

Which sections of the Income-tax Act were involved?

Section 10A

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Cases cited in this judgment(2)Show list

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Income Tax Appellate Tribunal, ‘C’ BENCH : CHENNAI

Before: SHRI ABRAHAM P.GEORGE & SHRI GEORGE MATHAN

For Respondent: Shri. Sriram Seshadri and Shri. K. K. Prasanna, Advocates

आदेश / O R D E R

PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER:

1.

These are appeals filed by the Revenue directed against an order dated 23.06.2017 of ld. Commissioner of Income Tax (Appeals)-11, Chennai for the impugned assessment years.

ITA Nos.2401 & 2402/2017 :- 2 -:

2.

Sole grievance of the Revenue is on the directions of the ld. Commissioner of Income Tax (Appeals) to reduce the expenditure excluded from export turnover, also from total turnover while calculating the deduction available to the assessee u/s.10A of the Income Tax Act, 1961 (in short ‘’the Act’’).

3.

Ld. Counsel for the Revenue submitted that ld. Commissioner of Income Tax (Appeals) had relied on the decision of Special Bench of the Tribunal in the case of ITO vs. M/s. Sak Soft Ltd (2009) 20 DTR

514.

As per the ld. DR, the Revenue had not accepted this decision and has filed an appeal before the Hon’ble Jurisdictional High Court.

Per contra, ld. Authorised Representative submitted that the 4.

view taken by the Special Bench of the Tribunal in the case of Sak Soft Ltd (supra) was in line with the judgment of Hon’ble Karnataka High Court in the case of CIT vs. Tata Elxi Ltd, 349 ITR 98.

We have considered the rival contentions and perused the 5. orders of the authorities below. Hon’ble Karnataka High Court in the case of Tata Elxi Ltd, (supra) had held that expenditure excluded from export turnover in the numerator, had to excluded from the total turnover in the denominator also, while applying formula for calculating the deduction u/s.10A of the Act. This is the same view as ITA Nos.2401 & 2402/2017 :- 3 -: taken by the Special Bench of the Tribunal in the case of Sak Soft Ltd (supra). We therefore do not find any reason to interfere with the order of the ld. Commissioner of Income Tax (Appeals).

6.

In the result, appeals of the Revenue stand dismissed.

Order pronounced on Monday, the 26th day of February, 2018, at Chennai.

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