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TMI Blog2015 (7) TMI 108X X X X Extracts X X X X X X X X Extracts X X X X ..... the alternate claim of that assessee to consider its eligibility deduction under Section 10A in place of 10B of the Act, squarely covers the issue in favour of the assessee. We find that from a perusal of the orders of the authorities below, since this issue of the assessee's alternate claim for deduction under Section 10A of the Act has not been considered by them, we are of the view that in the interest of equity and justice, this issue be examined by the Assessing Officer afresh in the light of the findings and observations thereon in the decisions of the Hon'ble High Court of Delhi in the case of Valiant Communications Ltd. (supra) - Decided in favour of assessee for statistical purposes - ITA No. 1435/Bang/2013 - - - Dated:- 17-4-2015 - P. Madhavi Devi, JM And Jason P. Boaz, AM,JJ. For the Appellant : Shri V Sridhar, CA For the Respondent : Dr Shankar Prasad K, JCIT (DR) ORDER Per Shri Jason P. Boaz, AM. This appeal by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-I, Bangalore dt.31.7.2013 and order under Section 154 of the Income Tax Act, 1961 (in short 'the Act') for Assessment Year 2010-11. 2. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... already considered the same. 5). The CIT(A) erred in not considering the foreign trade policy which clarified that approval granted by STP is sufficient for claiming exemption U/s 10B of the Act. 6). The CIT(A) erred in not granting the exemption claimed in this year, when there is no change in facts and circumstances when the exemption was allowed in the years earlier and it is only in the first year the allowance of claim to be substantiated. 7). The CIT(A) erred in not granting an opportunity to the appellant as specifically requested by the appellant vide misc. application dt.02.09.2013 which is opposed to the principle of natural justice. 8). The CIT(A) erred in not granting the alternative claim U/s 10A of the Act on technical grounds rather than dealing with the claim on merit without considering the Board circular relied on by the appellant. 9). The CIT(A) overlooked the ground in respect of alternative claim of exemption U/s 10A being a legal ground which should have been considered on merits rather than simply rejecting on the basis of Hon ble Supreme Court as held in Goetze (India) Ltd Vs CIT. 10). The CIT(A) erred in holding that the appellant is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... such handbook. Thus the words ,for all purposes ,imply that the approval given by STPI, being the concerned authority ,shall be deemed to be one meeting the purpose of approval under section10B of the ACT . Hence, denial of exemption when the appellant is eligible for exemption U/s 10B as per F.T. Policy is not correct. III. Exemption allowed in earlier year denial decision this year is not correct : The exemption U/s 10B was allowed for asst. year 2008-09 vide order U/s 143(3), dt.30.09.2010 (copy enclosed) when there is no change in facts and circumstances of the case the denied exemption U/s 10B of the Act this year is not correct. Copy of the return of income, computation and Form No.56G for claim exemption U/s 10B is enclosed herewith. IV. The Commissioner of Income Tax (Appeals) - failed to grant opportunity as requested vide application dt.02.09.2013 : The appellant on receipt of Commissioner of Income Tax (Appeals) order dt.31.07.2013 on 02.09.2013 filed on application for not having considered the grounds raised in the appeal. The application specifically requested for personal hearing to present the case. The Commissioner of Income Tax (Appeals), w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revenue for the development of the Country and not to charge assessee more than that which is due and payable by the assessee. It is in aforesaid circumstances that as far back as in 11.04.1955 the Central Board of Direct Tax had issued a circular vide No. 14(11-35) of 1955 directing Assessing Officer not to take advantage of assessee s ignorance and /or mistake. The relevant Portion of the above Circular is as under: 3. Officers of the Department must not take advantage of ignorance of an assessee as to his rights. It is one of their duties to assist a tax payer in every reasonable way, particularly in the claiming of any securing any reliefs and in this regard the officers should take initiative in guiding a taxpayer where proceedings or other particular before them indicate that some refund or relief is due to him. This attitude would, in the long run, benefit the Department for it would inspire confidence in him that he may be sure of getting a square deal from the Department. Although therefore, the responsibility for claiming refunds and reliefs rests with assessees on whom it is imposed by law, officers should:- a. draw their attention to any refunds or reliefs to wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the above exemption made in the return U/s 10B was denied both by the assessing officer and Commissioner of Income Tax (Appeals) relying on the decision of Hon ble Delhi High Court decision in case of CIT V/s. Regency Creations Ltd. (2012) 353 ITR 326. The 2nd respondent s namely M/s Valiant Communications Ltd. made a civil misc. application in ITA No.12/2013 (copy enclosed) and the Hon ble High Court after considering the application held as under : The applicant assessee had succeeded before the Tribunal in the contention that it was entitled to the benefit of Section 10B of the Income Tax Act. It had urged that the supporting materials disclose that there was STP clearance / approval under Section 10A and that such approval was sufficient to entitle it to the benefit of Section 10B. By judgment, this Court nagatived the plea with regard to the approval vis-a-vis Section 10B and has ruled that separate regime exists. The applicant contends that the Commissioner of Income Tax (Appeals) and Tribunal had, in the present case, not gone into the merits of the alternative claim for entitlement under Section 10A. This fact is apparent from a reading of the order of Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion of a coordinate bench of this Tribunal in the case of ANSR Sources India Pvt. Ltd. in ITA No.562/Bang/2013 dt.13.11.2013. It was submitted that in the cited case, one of issues that arose for consideration was whether the assessee could be permitted to change its claim for deduction from section 10B to section 10A of the Act. In that case the assessee had initially made a claim for deduction under Section 10A of the Act; which however in the statement of computation of income was mentioned as deduction under Section 10B of the Act. Both the Assessing Officer and the learned CIT(A) rejected the assessee's claim for deduction under Section 10B of the Act on the ground that the assessee had failed to furnish the approval certificate for its 100% EOU by the Development Commissioner as ratified by the Board for approval of the EOU Scheme. It is submitted that because the assessee in that case could not file the approval required under Section 10B of the Act and since the assessee was registered as a 100% EOU under the STPI Scheme, the assessee in that case, as has been done in the case on hand, made an alternate claim for deduction under Section 10A of the Act before the CIT (A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required as per the section 10B under which the claim is being made. Therefore the claim cannot be accepted. The assessee is not eligible for the exemption claim under Section 10B of the IT Act. Therefore the claim amount of ₹ 1,72,07,475 is being disallowed and added back to the returned income. 5.3.3 On appeal before the learned CIT(A), the assessee reiterated the submissions put forth before the Assessing Officer and contended that the Assessing Officer action in denying the assessee's claim for deduction under Section 10B of the Act was not correct. In appellate proceedings before the learned CIT(A), the assessee raised the additional ground of appeal that in the event of the assessee's claim for deduction under Section 10B of the Act was rejected, then alternatively, the assessee's claim for deduction under Section 10A of the Act be considered and in this context also filed Form No.56F rw Rule 16D. The learned CIT(A) also rejected the assessee's claim for deduction under Section 10B of the Act in the absence of requisite approval from the Board of approval ratifying the permission granted by the Development Commissioner. In respect of the assessee' ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Section 10A. This fact is apparent from a reading of the order of the CIT (Appeals) as well as that of the Tribunal in the order impugned. In the circumstances, the Tribunal shall consider the relevant documents on the basis of the claims and ascertain whether the applicant is entitled to the benefit under Section 10A, as claimed. The judgement of this Court dt.17.9.2012 is accordingly modified; the Tribunal shall proceed to pass appropriate orders after hearing both parties. 5.3.5 Following the aforesaid decision of the Hon'ble High Court of Delhi in the case of Valiant Communications Ltd., in Civil Misc. Application No.12/2013 dt.4.1.2013 (supra), wherein the Hon'ble High Court has held that the alternate claim of the assessee for deduction under Section 10A of the Act is to be considered, we hold that this finding covers the issue squarely in favour of the assessee s plea that its alternate claim for deduction under Section 10A of the Act is to be considered in accordance with law. The Auditor s Report in Form No.56F filed before the learned CIT(A) and admitted as additional evidence but not considered, is also to be considered while examining the assessee's al ..... X X X X Extracts X X X X X X X X Extracts X X X X
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