DCIT 8(3), MUMBAI vs. SYNTEL LTD, MUMBAI

Order u/s.254(1)of the Income-tax Act,1961(Act) लेखा लेखा सद�य लेखा लेखा सद�य सद�य, राजे�� सद�य राजे�� राजे�� केकेकेके अनुसार राजे�� अनुसार अनुसार/ PER Rajendra A.M.- अनुसार Challenging the order dated 22/08/2014 of the CIT (A)-18, Mumbai, the Assessing Officer(AO) has filed the present appeal.Assessee-compnay,engaged in the business of development and export of computer software services,was formed in May 1992.It filed its return of income on 06.10.2011 declaring income of Rs.80,29,87,670/- .The AO completed the assessment u/s.143(3) of the Act on 21.02.2014,determining its income at Rs.81,13,10,766/- 2.Effective ground is about allowability of deduction u/s.10A/10AA of the Act.During the assessment proceedings,the AO found that the assessee had claimed deduction u/s. 10A/10AA amounting to Rs.2,60.01,65,610/-,that it included interest income of Rs. 26.22 Crores.He asked the assessee to explain as to why the interest income should not be excluded while computing the income u/s.10 A/10AA of the Act.After considering the reply of the assessee, he held that it was not entitled to said deduction. 3.Aggrieved by the order of the AO,the assessee preferred an appeal before the First Appellate Authority (FAA),who following the order for the earlier AY.,reversed the order of the AO and allowed the appeal. 4.Before us,representatives of both the sides agreed that the identical issue stands decided in favour of the assessee by the orders of the Tribunal for earlier years.We find that the 6626/M/14-Syntel Tribunal,while deciding the appeals for the AY.s.2003-04 to 2007-08,has deliberated upon the identical issue(ITA.s/3413 & others/Mum/2007,2008 & 2010,dtd.31.08. 2015).While deciding the appeal no.ITA/3413/Mum/2003-04,the Tribunal has held as under: 5.Next ground is about not considering the claim that the interest income aggregating to Rs.5, 40,69,769/-derived by the assesseewas derived from the industrial undertaking and not allowing deduction u/s 10A/10B of the Act in respect of the said interest income.Before us,it was agreed by the DR and AR that the issue is decided in favour of the assessee by Tribunal’s orders for other AY.s. including AY.02-03(supra),that department’s appeal before the Hon’ble High Court pertaining to eligibility for deduction u/s. 10A of the Act was dismissed. 5.1.We find that while deciding the Appeals no.7544/7546/Mum/04 and ITA/8122-24/Mum/04 dt.11.02.2008,the Tribunal had decided the issue as under: 19.As regards grounds Nos. 4 & 6 relating to interest and other income claimed as exemption u/s. 10A and 10B of the Act, we find that this issue is also covered in favour of the assessee by the decision of the Tribunal in assessee’s own case for the AYrs. 99-2000 and 2000-01 wherein it has been held to have a direct nexus with the business and development of export of software. Respectfully following the decisions of the coordinate bench, these grounds of the assessee are allowed. Respectfully following the above order of the Tribunal and considering the fact-that the appeal filed by the Department with regard to eligibility of 10A/10B deduction,before the Hon’ble High Court,has been dismissed-we decide the issue in favour of the assessee.” While deciding the appeal for the AY.2004-05(ITA /2263/Mum/2008)the Tribunal had decided the issue as follow: 12.Last ground raised

by the AO is about calculation of interest income for deduction u/s.10A/ 10B of the Act.We find that while deciding the issue of eligibility of interest income for the earlier year and in the appeal filed by the assessee for the year under consideration,we have decided the issue against the AO and in favour of the assessee. Following the same,ground no.3 is decided against the AO. Respectfully following the above,we decide the effective ground of appeal against the AO. As a result,appeal filed by the AO stands dismissed. फलतः िनधा�रती अिधकरा �ारा दािखल क� गई अपील नामंजूर क� जाती है. Order pronounced in the open court on 18th January 2017. आदेश क� घोषणा खुले �यायालय म� �दनांक 18 जनवरी, 2017 को क� गई । Sd/- Sd/- ( पवन�सह/Pawan singh) (राजे�� / RAJENDRA) �याियक सद�य / JUDICIAL MEMBER लेखा लेखा लेखा सद�य लेखा सद�य सद�य / ACCOUNTANT MEMBER सद�य मुंबई Mumbai; �दनांकDated : 18.01.2017. Jv.Sr.PS. आदेश आदेश क� आदेश आदेश क� क� �ितिलिप क� �ितिलिप �ितिलिप अ�ेिषत �ितिलिप अ�ेिषत अ�ेिषत/Copy of the Order forwarded to : अ�ेिषत 1.Appellant /अपीलाथ�

2. Respondent /��यथ�