THE COMMISSIONER OF INCOME-TAX vs. M/S MIND TREE CONSULTING LTD.

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ITA/175/2013HC KarnatakaKAHC01018425201317 August 2020Bench: ALOK ARADHE,H.T. NARENDRA PRASAD4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the substantial questions of law were answered against the revenue, following a Supreme Court judgment. Therefore, the appeal filed by the revenue was dismissed.

What were the facts?

The Revenue appealed against an ITAT order concerning the computation of deduction under Section 10B of the Income Tax Act. The core dispute involved whether certain charges excluded from export turnover should also be excluded from total turnover for deduction calculation.

What were the issues?

Whether foreign currency, telecommunication, and insurance charges excluded from export turnover must also be excluded from total turnover for Section 10B deduction calculation.

Which sections of the Income-tax Act were involved?

Section 10B

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 17TH DAY OF AUGUST 2020

PRESENT

THE HON’BLE MR. JUSTICE ALOK ARADHE

AND

THE HON’BLE MR. JUSTICE H.T.NARENDRA PRASAD

I.T.A. NO.175 OF 2013 BETWEEN:

1.

THE COMMISSIONER OF INCOME-TAX

C.R. BUILDING, QUEENS ROAD

BANGALORE.

2.

THE ASST. COMMISSIONER OF INCOME-TAX

CIRCLE-12(1), RASHTROTHANA BHAVANA

NRUPATHUNGA ROAD, BANGALORE. ... APPELLANTS (BY Mr. M. DILIP, A/W Mr. K.V. ARAVIND, ADVS.)

AND:

M/S. MIND TREE CONSULTING LTD., (FORMERLY MIND TREE CONSULTING PVT. LTD.,) GLOBAL VILLAGE, RVCE POST MYLASANDRA, MYSORE ROAD BANGALORE-560059. ... RESPONDENT (BY Mr. CHYTHANYA K.K. ADV.) - - -

THIS I.T.A. IS FILED UNDER SECTION 260-A OF I.T. ACT, 1961, ARISING OUT OF ORDER DATED 31-10-2012 PASSED IN ITA NO.1347/BANG/2011, FOR THE ASSESSMENT YEAR 2006-07 PRAYING TO:

I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN. II. ALLOW THE APPEAL AND SET ASIDE THE ORDER DATED 31-10-2012 IN ITA NO.1347/BANG/2011 PASSED BY THE ITAT, BENGALURU AND CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-12(1), BANGALORE.

THIS I.T.A. COMING ON FOR HEARING, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING:

JUDGMENT

Mr.K.V.Aravind, learned counsel along with Mr.M.Dilip, learned counsel for the revenue. Mr.Chythanya K.K., learned counsel for the assessee.

2.

This appeal under Section 260-A of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’, for short) has been preferred by the revenue which was admitted by a Bench of this Court on 14.08.2013 on the following substantial questions of law: “1. Whether the Appellate Authorities were correct in holding that foreign currency, telecommunication and insurance charges excluded from export turnover has to be

excluded from total turnover also for the purpose of computing deduction under Section 10B of the Act contrary to the provisions of Section 10B of the Act?

2.

Whether the Appellate Authorities were correct in not taking into consideration that Section 10B provides for exclusion of certain expenses only from export turnover and the same cannot be reduced/excluded from total turnover in the absence of specific provision and recorded a perverse finding?”

3.

When the matter was taken up today, learned counsel for the revenue fairly submitted that the substantial questions of law have been answered against the revenue by the Supreme Court in ‘COMMISSIONER OF INCOME-TAX, CENTRAL-III Vs. HCL TECHNOLOGIES LTD.’ (2018) 302 CTR 191 (SC).

4.

In view of the aforesaid enunciation of law, the substantial questions of law framed by this Court in this

appeal are answered against the revenue and in favour of the assessee. In the result, the appeal is dismissed.

Sd/- JUDGE

Sd/- JUDGE

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