ASST.C.I.T., BANGALORE vs. M/S MCAFEE SOFTWARE (INDIA) PVT. LTD., BANGALORE

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ITA 422/BANG/2016Status: DisposedITAT Bangalore07 April 2017AY 2011-123 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal upheld the DRP's decision, following the jurisdictional High Court's judgment in Tata Elxsi Ltd. The Tribunal found no reason to deviate from the High Court's precedent, even though the Revenue had filed an appeal against it.

What were the facts?

The Revenue appealed against the DRP's direction to exclude telecommunication and travelling expenses from both export turnover and total turnover for calculating the deduction under Section 10A. The AO had initially deducted these expenses only from the export turnover.

What were the issues?

Whether expenses incurred in foreign currency for telecommunication and travelling should be excluded from both export turnover and total turnover for the purpose of Section 10A deduction.

Which sections of the Income-tax Act were involved?

Section 10A

AI-generated summary — verify with the full judgment below

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Income Tax Appellate Tribunal, BENGALURU BENCH B, BENGALURU

For Appellant: Shri. K. P. Vasudevan, Advocate
For Respondent: Smt. Neera Malhotra, CIT-DR

PER S. JAYARAMAN, ACCOUNTANT MEMBER :

1.

This is an appeal filed by the Revenue against the order of the ACIT, dt.28.01.2016, passed u/s.143(3) r.w.s.144C(13) of the Act, in pursuance to the directions of the DRP, dt.01.12.2015, , for the assessment year 2010-11.

2.

In this appeal, the grievance of the Revenue is that the DRP directed the AO to exclude both from export turnover as well as the total turnover IT(TP)A.422/Bang/2016 Page - 2 expenses like telecommunication charges and travelling expenses of Rs.5,33,47,824/- and Rs.4,93,45,041/-, respectively, incurred in foreign currency, when the AO deducted them from the export turnover alone for working out the deduction u/s.10A of the Act.

3.

We find that the DRP had followed the judgment of Hon’ble jurisdictional High Court in the case of Tata Elxsi Ltd v. CIT [349 ITR 98], in directing exclusion of items deducted from export turnover and from total turnover also for working out the deduction u/s.10A of the Act. Just for a reason that appeal has been filed by the Revenue against the judgment of jurisdictional High Court, would not be a reason not to follow the jurisdictional High Court’s judgment. We do not find any lacunae in the order of DRP.

4.

In the result, appeal of the Revenue stands dismissed.

Order pronounced in the open court on 7th day of April, 2017.

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