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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 9TH DAY OF SEPTEMBER 2020
PRESENT
THE HON’BLE MR. JUSTICE ALOK ARADHE
AND
THE HON’BLE MR. JUSTICE H.T.NARENDRA PRASAD
I.T.A. NO.95 OF 2013
BETWEEN:
THE COMMISSIONER OF INCOME TAX
LTU, JSS TOWERS, BSK III STAGE
BANGALORE.
THE ADDL. COMMISSIONER OF INCOME TAX
RANGE-8(1), MUMBAI.
THE JOINT COMMISSIONER OF INCOME TAX
LTU, JSS TOWERS, BSK III STAGE
BANGALORE. ... APPELLANTS (BY SRI. K.V. ARAVIND, ADV.)
AND:
M/S. ABB LIMITED (FORMERLY ASEA BROWN BOVERI LIMITED) NO.22A, SHAH INDUSTRIAL ESTATE OFF VEERA DESAI ROAD ANDHERI, MUMBAI-400053. ... RESPONDENT (BY SRI. T. SURYANARAYANA, ADV.) - - -
THIS I.T.A. IS FILED UNDER SECTION 260-A OF I.T.ACT, 1961, ARISING OUT OF ORDER DATED 19-10-2012 PASSED IN ITA NO.3809/MUM/2003, FOR THE ASSESSMENT YEAR 1998-99, PRAYING TO: I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN. II. ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE ITAT, BANGALORE IN ITA NNO.3809/MUM/2003 DATED 19-10-2012 AND CONFIRM THE ORDER OF THE APPELLATE COMMISSIONER CONFIRMING THE ORDER PASSED BY THE COMMISSIONER OF INCOME TAX, MUMBAI, IN THE INTEREST OF JUSTICE AND EQUITY.
THIS I.T.A. COMING ON FOR HEARING, THIS DAY, ALOK ARADHE J., DELIVERED THE FOLLOWING:
JUDGMENT
Mr.K.V.Aravind, learned counsel for the revenue. Mr.T.Suryanarayana, learned counsel for the assessee.
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 vide order dated 24.06.2013 to consider the following substantial questions of law:
“1. Whether the Tribunal was correct in holding that cash compensatory assistance and duty drawback is liable to tax receipt basis and not on the accrual basis contrary to the view expressed by it in the case of the assessee for the assessment year 1994-95 and recorded a perverse finding? 2. Whether the Tribunal was correct in holding that other income has to be reduced by 90% of such net income when computing profits of business for the purpose of allowing deduction u/s.80HHC of the Act and not gross income when other income was not derived from export activity? 3. Whether the Tribunal was correct in holding that the expenditure incurred towards upgradation of personal computers has no enduring benefit hence cannot be treated as capital expenditure? 4. Whether the Tribunal was correct in holding that the expenditure incurred for acquiring MS-OFFICE Software is only a license and no asset is acquired or no
benefit of enduring nature for the assessee?”.
When the matter was taken up today, learned counsel for the assessee submitted that the first substantial question of law has already been answered against the revenue by this Court in ‘COMMISSIONER OF INCOME-TAX Vs. ASEA BROWN BOVERI LTD.’
(2020) 117 TAXMANN.COM 415 (KAR). The aforesaid fact could not be disputed by the learned counsel for the revenue. For the reasons assigned in the aforesaid judgment, the first substantial question of law framed in this appeal is answered against the revenue and in favour of the assessee.
It is pointed out that the second substantial question of law has been answered by the Supreme Court against the revenue in ‘ACG ASSOCIATED CAPSULES (P) LTD. Vs. COMMISSIONER OF
INCOME-TAX, CENTRAL-IV, MUMBAI’ (2012) 18 TAXMANN.COM 137 (SC) . The aforesaid fact could not be disputed by the learned counsel for the revenue. For the reasons assigned in the aforesaid judgment, the second substantial question of law framed in this appeal is answered against the revenue and in favour of the assessee.
It is also pointed out that the third substantial question of law has already been answered by this Court vide judgment dated 16.06.2020 in ‘COMMISSIONER OF INCOME-TAX-III AND ANR. Vs. M/s. NCR CORPORATION PVT LTD.’ in ITA No.240/2011 against the revenue. In this connection, attention has been invited to paragraph 7 of the judgment. For the reasons assigned in the aforesaid judgment, the third substantial question of law framed in this appeal is answered against the revenue and in favour of the assessee.
It is also pointed out that the fourth substantial question of law has already been answered by this Court against the revenue in ‘COMMISSIONER OF INCOME- TAX Vs. IBM INDIA LTD.’ (2014) 43 TAXMANN.COM 470 (KAR). For the reasons assigned in the aforesaid judgment, the fourth substantial question of law framed in this appeal is answered against the revenue and in favour of the assessee In the result, the appeal fails and is dismissed.
Sd/- JUDGE
Sd/- JUDGE