PR.COMMISSIONER OF vs. M/S. TELERADIOLOGY

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ITA/385/2015HC KarnatakaKAHC01039307201504 December 2015Bench: S.SUJATHA,VINEET SARAN3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that the first two questions of law were covered by a previous decision and did not raise substantial questions of law. Regarding the third question, the court found no reason to interfere with the ITAT's finding that the disputed expenditure was for repairs and maintenance, thus revenue in nature.

What were the facts?

The ITAT held that reimbursement of telecommunication and insurance expenses incurred in foreign currency should be excluded from both total and export turnover for Section 10A deduction. The ITAT also treated expenditure on granite work, pavement gate, and a specific tank as revenue expenditure.

What were the issues?

Whether foreign currency reimbursements should be excluded from turnover for Section 10A deduction and whether certain expenditures are revenue or capital in nature.

Which sections of the Income-tax Act were involved?

Section 10A,Section 37(1)

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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IN THE HIGH COURT OF KARNATAKA AT BENGALURU

DATED THIS THE 4TH DAY OF DECEMBER, 2015

PRESENT

THE HON'BLE MR. JUSTICE VINEET SARAN

AND

THE HON’BLE MRS. JUSTICE S.SUJATHA

I.T.A.NO.385/2015

BETWEEN:

1.

PR. COMMISSIONER OF INCOME TAX, CENTRAL REVENUE BUILDINGS, QUEENS ROAD, BANGALORE-560 001.

2.

THE DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE 12(4) BANGALORE. …APPELLANTS

(BY SRI E.R.INDRAKUMAR, SR. ADV., FOR SRI E.I.SANMATHI)

AND:

M/S. TELERADIOLOGY SOLUTIONS PVT. LTD., NO.7G1, VISWESHWARAIAH INDUSTRIAL AREA, ITPL ROAD, OPP. GRAPHITE INDIA, BANGALORE-48 PAN:AABCT8183H …RESPONDENT

THIS ITA IS FILED UNDER 260-A OF IT ACT, 1961, ARISING OUT OF ORDER DATED 13.02.2015 PASSED IN ITA NO.1728/BANG/2013, FOR THE ASSESSMENT YEAR 2009-10 PRAYING TO DECIDE THE FORGOING QUESTION OF LAW AND ETC.,

THIS ITA COMING ON FOR ADMISSION THIS DAY, VINEET SARAN J., DELIVERED THE FOLLOWING:

JUDGMENT

We have heard Sri E.R.Indrakumar, learned Senior Counsel appearing along with Sri E.I.Sanmathi, for the appellants and perused the record.

2.

This appeal has been filed raising the following questions of law:

“i. Whether, on the facts and in the circumstances of the case, is the Tribunal is justified in law in holding that the reimbursement of telecommunication expenses and insurance incurred in foreign currency are to be excluded both from total turnover as well as from export turnover for computation of deduction under Section 10A whereas such exclusion is permitted to arrive at export turnover only as per the definitions given in section 10A of the I.T.Act and total turnover has not been defined in the section?

ii. Whether, the Tribunal is correct in law in holding that the deduction under Section 10A should be computed in the above manner following the judgment of this Hon’ble Court in the CIT V/s. TATA Elxsi which has not become final since the same has challenged before Hon’ble Apex Court by filing SLP and as such the Tribunal ought to have awaited the decision of the Hon’ble Apex Court?

iii. Whether, on the facts and in the circumstances of the case, is the Tribunal is justified in law in holding that expenditure incurred on Granite Work, Pavement Gate and Specific Tank as revenue expenditure as against capital expenditure held by assessing authority

even when that only current repairs are eligible to be claimed and Section 37(1) excludes those items of expenditure which expressly falls in Sections 30 to 36?”

3.

Learned counsel for the appellants has fairly stated that the first two questions are covered by the decision of this Court in the case of Commissioner of Income Tax Vs Tata Elxsi Limited (2012) 349 ITR 98. As such, no substantial question of law arises for determination by this Court in the first two questions.

4.

As regards the third question, the findings of fact have been recorded by the Commissioner of Income Tax (Appeals), as well as the Tribunal, that the expenditure of Rs.17,43,738/-, which is disputed, was incurred towards repairs and maintenance, which would be revenue in nature and not capital expenditure. We find no reason to defer with the findings so recorded by the authorities below. As such, we do not find that any substantial question of law arises for determination by this Court in this appeal. The appeal is accordingly dismissed.

Sd/-

JUDGE

Sd/-

JUDGE TL

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