CIT v. Tata Elxsi Ltd.

The Income Tax Officer Ward-6(1)(1), Bangalore vs. M/S Scancafe Digital Solutions Pvt Ltd, Bangalore

In the result, the appeal filed by the revenue is dismissed

Bench: Shri A.K. Garodia & Shri George George Kassessment Year: 2011 – 12

…IN THE INCOME TAX APPELLATE TRIBUNAL “B” BENCH : BANGALORE BEFORE SHRI A.K. GARODIA, ACCOUNTANT MEMBER AND SHRI GEORGE GEORGE K, JUDICIAL MEMBER Assessment year: 2011 – 12 M/s. Scancafe Digital Solutions Pvt. Ltd., Ground Floor, Neil Rao Towers, Plot No. 118, Road No. 3, ITO ward 6(1)[1], Vs. EPIP Phase – 1, Whitefield, Bangalore. Bangalore – 560 066. PAN: AAKCS5398E APPELLANT RESPONDENT Assessee by : Shri Keerthinarayan Iyengar, C. A. Revenue by : Smt. Padmameenakshi, JCIT DR Date of hearing : 02.11.2017 Date of Pronouncement : 03.11.2017 O R D E R Per Shri A.K. Garodia, Accountant Member This is a revenue…

Deputy Commissioner of Income-Tax, Bangalore vs. M/S Tata Elxsi.Ltd., Bangalore

In the result, the appeal by the Revenue is dismissed

Bench: Shri George George K, Jm & Shri Jason P.Boaz, Am

…urnover should also be reduced from total turnover in computing exemption under section 10A, the honorable Karnataka High Court, in appellant’s own case, i.e., CIT v. Tata Elxsi Ltd. and other group of cases vide their order dated 30th August 2011 reported in 349 ITR 98 held that expenses reduced from export turnover should also be reduced from the total turnover while computing exemption under section 10A. Therefore, respectfully following the cited decisions of the honorable ITAT, Bengaluru Bench and that of the jurisdictional High Court, the fifth and sixth grounds of appeal are allowed.” 7.4 The Revenue bein…

Deputy Commissioner of Income-Tax, Bangalore vs. M/S Subex Ltd, Bangalore

In the result, the appeal by the revenue is dismissed

Bench: Shri Sunil Kumar Yadav & Shri A.K. Garodiaassessment Year : 2007-08

…er of the CIT (Appeals) is opposed to law and the facts and circumstances of the case. 2. On the facts and in circumstances of the case, the CIT(A) erred in citing the ratio laid down by the Hon'ble High Court in the case of CIT Vs Tata Elxsi Ltd. reported in 349 ITR 98 and directing the AO to reduce expenses incurred in foreign currency, both from Export Turnover as well as from Total Turnover for Page 2 of 3 the purpose of computation of deduction u/s 10A, without appreciating the fact that the statute allows exclusion of such expenditure ONLY from Export Turnover by way of a specific definition for Export Tur…

Asst.C.I.T., Bangalore vs. M/S Anz Operations & Technology Private Limited, Bangalore

In the result, the appeal of the revenue and the Cross Objection of the assessee are allowed for statistical purposes

…ion u/s.10A after reducing travel expenses to the tune of Rs.11,44,86,655/- from the export turnover as well as the total turnover while calculating deduction u/s.10A following the ratio laid down by the Hon'ble High Court in the case of Tata Elxsi Limited in 349 ITR 98 without appreciating the fact that there is no provision in Section 10A that such expenses should be reduced from the total turnover also, as clause (iv) of the Explanation to Section 10A provides that such expenses are to be reduced only from the export turnover. 3. The CIT(A) erred in not appreciating the fact that the jurisdictional High Court'…

DCIT, Bangalore vs. Outsource Partners International Pvt. Ltd., Bangalore

In the result, all appeals are partly allowed for statistical purposes

Bench: Shri Sunil Kumar Yadav & Shri Jason P Boazit(Tp)A Nos. & Appellant Respondent Assessment Years No.443/Bang/2016 M/S. Outsource Partners Dy. Commissioner Of 2011-12 International Pvt. Ltd., Income-Tax, Tower 2D, Phase I, Vikas Circle-5(1)(2), Telecom Ltd., Bangalore. Vrindavan Tech Village, Outer Ring Road, Devarabeesanahalli, Bangalore- 560087. Pan: Aaaco5734C No. 526/Bang/2016 Dy. Commissioner Of M/S. Outsource Partners 2011-12 Income-Tax, International Pvt. Ltd., Circle-5(1)(2), Pan: Aaaco5734C Bangalore. No.535/Bang/2017 M/S. Outsource Partners Assistant Commissioner Of 2009-10 International Pvt. Ltd., Income Tax, Pan: Aaaco5734C Circle-5(1)(2), Bangalore.

…bench members to not propose a negative working capital adjustment.” 23. Ground No.1 is general in nature and with respect to ground No. 2, it was contended that this ground is covered by judgment of jurisdictional High Court in the case of Tata Elxsi Ltd., 349 ITR 98 in which it has been held that whenever any expenditures are to be excluded from the export turnover, the same should also be excluded from the total turnover. We, accordingly, following the same, direct the AO/TPO to exclude the telecommunication charges from the turnover also as it was excluded from the export turnover. 24. Ground No. 3 relate…

Outsourcepartners International Private Limited, Bangalore vs. DCIT, Bangalore

In the result, all appeals are partly allowed for statistical purposes

Bench: Shri Sunil Kumar Yadav & Shri Jason P Boazit(Tp)A Nos. & Appellant Respondent Assessment Years No.443/Bang/2016 M/S. Outsource Partners Dy. Commissioner Of 2011-12 International Pvt. Ltd., Income-Tax, Tower 2D, Phase I, Vikas Circle-5(1)(2), Telecom Ltd., Bangalore. Vrindavan Tech Village, Outer Ring Road, Devarabeesanahalli, Bangalore- 560087. Pan: Aaaco5734C No. 526/Bang/2016 Dy. Commissioner Of M/S. Outsource Partners 2011-12 Income-Tax, International Pvt. Ltd., Circle-5(1)(2), Pan: Aaaco5734C Bangalore. No.535/Bang/2017 M/S. Outsource Partners Assistant Commissioner Of 2009-10 International Pvt. Ltd., Income Tax, Pan: Aaaco5734C Circle-5(1)(2), Bangalore.

…bench members to not propose a negative working capital adjustment.” 23. Ground No.1 is general in nature and with respect to ground No. 2, it was contended that this ground is covered by judgment of jurisdictional High Court in the case of Tata Elxsi Ltd., 349 ITR 98 in which it has been held that whenever any expenditures are to be excluded from the export turnover, the same should also be excluded from the total turnover. We, accordingly, following the same, direct the AO/TPO to exclude the telecommunication charges from the turnover also as it was excluded from the export turnover. 24. Ground No. 3 relate…

Assistant Commissioner of Income Tax Circle-7(1)(2), Bangalore vs. M/S Vee Technologies Pvt Ltd, Bangalore

In the result, appeal of the Revenue is dismissed

Bench: Shri. Inturi Rama Rao

…ign currency be deducted from the export turnover as well, for working out the deduction u/s.10A. We have the rival submissions. We find that the CIT (A) had 06. 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 Ita.926/Bang/2017 Page - 7 items which are deducted from export turnover also to be deducted from the 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 t…

Deputy Commissioner of Income Tax Circle-1(1)(1), Bangalore vs. M/S Aol Online India Private Limited, Bangalore

In the result, the appeal filed by the revenue is allowed for statistical purposes

Bench: Shri Arun Kumar Garodia & Shri Vijay Pal Raoassessment Year : 2011-12

…ed the assessment order and learned AR of the assessee supported the order of CIT (A). He also submitted that this issue is now covered in favour of the assessee by the judgment of Hon’ble Karnataka High Court rendered in the case of Tata Elxsi as reported in 349 ITR 98. 4. We have considered the rival submissions. We find that as per this judgment of Hon’ble Karnataka High Court rendered in the case of Tata Elxsi (Supra), total turnover is sum total of export turnover and domestic turnover and therefore, if an amount is reduced from export turnover, then total turnover also gets Page 2 of 2 reduced automatically…

M/S Subex Limited, Bangalore vs. Deputy Commissioner of Income Tax, Bangalore

In the result, the appeal filed by the assessee is partly allowed for statistical purposes

Bench: Shri Arun Kumar Garodia & Shri Vijay Pal Rao

…ssee u/s. 10AA of the I.T. Act, 1961 but if the assessee is not able to do so then these expenses should be reduced from both export turnover and total turnover as has been held by Hon'ble Karnataka High Court in case of CIT Vs. Tata Elxsi Ltd. as reported in 349 ITR 98. This ground is allowed for statistical purposes. 4. Regarding ground no. 2, it was submitted by ld. AR of assessee that this ground is not pressed. Accordingly this ground is rejected as not pressed. 5. Regarding ground no. 3, it was submitted that this issue is covered in favour of the assessee by the tribunal order in assessee’s own case for…

ITO, Bangalore vs. M/S Aptean Software India Pvt. Ltd., (M/S Cdc Software India Pvt. Ltd., Bangalore

In the result, the appeal filed by the assessee is allowed for statistical purposes whereas the appeal filed by the revenue is partly allowed for statistical purposes

Bench: Shri Arun Kumar Garodia & Shri Vijay Pal Rao

…that the expenditure incurred is a normal phenomena and a company cannot be excluded merely on abnormal profit margins. Corporate Issue: 7. The DRP erred in directing the AO to follow the ratio laid down by the Hon'ble Court in the case of Tata Elxsi Limited 349 ITR 98 and exclude communication expenses and travel expenses from the total turnover also, while computing the deduction u/s 10A of the I.T. Act, without appreciating the fact that there is no provision in section 10A that such expenses should be reduced from the total turnover also, as clause (iv) of the explanation to section 10A provides that such ex…

M/S Aptean Software India Pvt. Ltd., Bangalore vs. ITO, Bangalore

In the result, the appeal filed by the assessee is allowed for statistical purposes whereas the appeal filed by the revenue is partly allowed for statistical purposes

Bench: Shri Arun Kumar Garodia & Shri Vijay Pal Rao

…that the expenditure incurred is a normal phenomena and a company cannot be excluded merely on abnormal profit margins. Corporate Issue: 7. The DRP erred in directing the AO to follow the ratio laid down by the Hon'ble Court in the case of Tata Elxsi Limited 349 ITR 98 and exclude communication expenses and travel expenses from the total turnover also, while computing the deduction u/s 10A of the I.T. Act, without appreciating the fact that there is no provision in section 10A that such expenses should be reduced from the total turnover also, as clause (iv) of the explanation to section 10A provides that such ex…

DCIT vs. M/S Verisign Services India Pvt. Ltd., Bangalore

In the result, the revenue’s appeal and C

Bench: Shri Arun Kumar Garodia & Shri Vijay Pal Rao

…IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH “ B ” BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER AND SHRI VIJAY PAL RAO, JUDICIAL MEMBER I.T.(T.P) A. No.1230/Bang/2013 (Assessment Year : 2008-09) Dy. Commissioner of Income Vs. M/s. Verisign Services India Pvt. Ltd., The Summit, No.6/B, 7th Main, 3rd Tax, Circle 12(5), Bangalore. Block, 80 Feet Road, Koramangala Indl. Layout, Bangalore-560 034 Appellant Respondent. C.O. No.164/Bang/2015 (In I.T.(T.P) A. No.1230/Bang/2013) (Assessment Year : 2008-09) (By Assessee) Assessee By : S/Shri P.K. Prasad & Umashankar Gautam, Advocates. Revenue By : Ms. Neer…

Altimetrik India Private Limited, Bangalore vs. Deputy Commissioner of Income Tax Circle-6(1)(2), Bangalore

In the result, the appeal of the assessee is partly allowed

Bench: Shri Arun Kumar Garodia & Shri Vijay Pal Rao

…ort turnover an equal amount should also be reduced from total turnover while computing the deduction under section 10A of the Act, is covered in favour of the assessee by the decision of the Hon’ble Karnataka High Court in the case of CIT Vs. Tata Elxsi Ltd. 349 ITR 98 (Kar). The decision of Hon'ble jurisdictional High Court has been followed in a number of cases in co-ordinate benches of ITAT. Hence, this issue is decided against the revenue and in favour of assessee. 23. Ground No.15 is general in nature and do not require any specific adjudication. 24. In the result, the appeal of the assessee is partly allow…

M/S Moog India Technology Center Pvt. Ltd., Bangalore vs. ITO, Bangalore

In the result, appeal of the assessee is allowed for statistical purposes

Bench: Shri. Jason P. Boaz

…ld have been reduced both from the export turnover and also the total turnover. 15. We have heard the rival submissions. In this regard, 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 which are deducted from export turnover also to be deducted from the total turnover also for working out the deduction u/s.10A of the Act. Since the DRP had rightly followed the judgment of the Hon’ble jurisdictional High Court in Tata Elxsi (supra), in giving such directions, we do not find any lacunae in the ord…

ITO, Bangalore vs. M/S Galax E Solutions India Pvt. Ltd., Bangalore

In the result, the C. O. filed by the assessee is partly allowed for statistical purposes

Bench: Shri A.K. Garodia & Shri Laliet Kumar

…4. It was agreed by both sides that the Ground No. 1 in the appeal of the revenue is general. Regarding Ground no. 2 & 3, both sides agreed that as per the judgment of Hon’ble Karnataka High Court rendered in the case of CIT Vs. Tata Elxi Ltd. as reported in 349 ITR 98 (Kar), it was held by Hon’ble Karnataka High Court that Total turnover is sum total of export turnover and domestic turnover and therefore, if an amount is reduced from export turnover, then total turnover also goes down by the same amount automatically. The directions of DRP to deduct telecommunication expenses from export turnover and total turn…

JCIT, Bangalore vs. M/ Sdell International Services India (P) Ltd., Bangalore

In the result, IT(TP)A No

Bench: Shri N.V.Vasudevan & Shri Jason P. Boaz

…allowed at a much lower sum than what was claimed by the Assessee. 9. Before CIT(Appeals), the reiterated submissions made before AO and further placed reliance on the decision of the Hon’ble Karnataka High Court in the case of CIT v. Tata Elxsi Ltd [2012] 349 ITR 98 (Karn) wherein it was held that telecommunication charges should be excluded both from IT(TP)A Nos. 85 & 1026/B/14, 1838/B/13 & CO No.21/B/16 Page 6 of 36 the total turnover and export turnover while applying the formula u/s.10A(4) of the Act while allowing deduction u/s.10A of the Act. The CIT(A) accepted the alternative prayer of the Assessee…