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TMI Blog2016 (3) TMI 740X X X X Extracts X X X X X X X X Extracts X X X X ..... ical to the issue before the Tribunal in Clarion Technologies (P.) Ltd. Vs. DCIT (2014 (11) TMI 141 - ITAT PUNE) and following the same parity of reasoning, we deem it fit to remand the issue back to the file of Assessing Officer to verify the claim of the assessee for deduction under section 10A of the Act in accordance with law. - Decided in favour of assessee for statistical purposes. - ITA No. 185/PN/2014 - - - Dated:- 30-12-2015 - Sushma Chowla, JM And Pradip Kumar Kedia, AM For the Appellants : Dr Prayag Jha Shri Prateek Jha For the Respondent : Shri Pankaj Garg ORDER Per: Sushma Chowla, AM This appeal filed by the assessee is against the order of CIT(A)-I, Pune, dated 31.10.2013 relating to assessment year 2010-11 against order passed under section 143(3) of the Income-tax Act, 1961 (in short 'the Act'). 2. The assessee has raised the following grounds of appeal:- The learned Commissioner of Income-tax, Appeals erred in sustaining the action of assessing officer in determining total income of appellant at ₹ 69,57,970 against returned income Rs.NIL. The learned Commissioner of Income-tax, Appeals erred in sustaining the act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 14 of IDAR Act, 1951. The pre-conditions that govern the units set up under STPI are different from those that govern the units set up as 100% EOU and so approved by the Board. The Hon'ble High Court further held that section 10A of the Act extends the exemption to the units set up under STPI Scheme, which start production of goods during previous year relevant to assessment year commencing on or after 1st April, 1994. Since the unit of the assessee was registered under STPI and not having approval from the Development Commissioner as 100% EOU, the assessee having not fulfilled the conditions specified under section 10B of the Act, was found to be not eligible for the aforesaid deduction by the Assessing Officer. The assessee before the Assessing Officer made an alternate plea that in case deduction under section 10B of the Act is not to be allowed to it, then the deduction under section 10A of the Act should be allowed. The Assessing Officer vide para 4.6 observed that the same cannot be accepted as the assessee should have claimed the deduction through filing of return of income and other requirements should be fulfilled. The two conditions to be fulfilled were that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt year 2009-10, order dated 26.02.2014 has decided the issue in favour of the assessee in relation to the claim of deduction under section 10B of the Act. 8. The learned Departmental Representative for the Revenue stressed that the issue is squarely covered against the assessee by the decision of Pune Bench of Tribunal in Clarion Technologies (P.) Ltd. Vs. DCIT (2015) 57 taxmann.com 351 (Pune-Trib), wherein it has been held that the approval granted to 100% EOU set up under STPI could not be deemed to be an approval under section 10B of the Act. However, the Tribunal had allowed an alternate plea of the assessee under section 10A of the Act and it was held that the assessee should be granted an opportunity to put forth its claim for deduction under section 10A of the Act. The learned Departmental Representative for the Revenue pointed out that the issue is squarely against the assessee, in view of the ratio laid down by the Hon'ble Delhi High Court in CIT Vs. Regency Creations Ltd. (supra). 9. We have heard the rival contentions and perused the record. The issue arising before us is two-fold as the EOU which is set up under STPI Scheme whether can avail the deduction und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taining of approval from the entity prescribed in Explanation 2(iv) below section 10B of the Act has been specifically negated by the Hon'ble Delhi High Court in the case of Regency Creations Ltd. (supra). The other aspect raised by the learned Representative for the assessee to the effect that a conjoint reading of the Exim Policy/Foreign Trade Policy entitles the assessee to the benefits of section 10B of the Act, once the unit is approved as per the Exim Policy. No doubt, such a plea is not found to have been urged before the Hon'ble Delhi High Court, so however, having regard to the judicial discipline, the Tribunal being inferior to the High Court, cannot disregard the judgement of the High Court in the manner sought to be canvassed before us. The judgement of the Hon'ble Delhi High Court in the case of Regency Creations Ltd. (supra) is a solitary decision of a High Court on this issue and squarely covers the controversy before us. Therefore, we are unable to find any fault in the action of the lower authorities in denying the claim of the assessee for deduction u/s 10B of the Act, based on the judgement of the Hon'ble Delhi High Court in the case of Regency Cr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... income filed for the assessment year under consideration i.e. 2010-11 also assessee claimed deduction u/s 10B of the Act in relation to the profits derived from its STPI unit. This claim of deduction came to be denied on the ground that the approval from Director, STPI was insufficient and that the assessee was required to take approval from the Board appointed for this purpose by the Central Government, following the judgement of the Hon'ble Delhi High Court in the case of Regency Creations Ltd. (supra). In the aforesaid situation, at the time of filing of return of income for the instant assessment year, assessee could not have envisaged the denial of its claim of deduction u/s 10B of the Act, which was being allowed in the past. The aforesaid circumstance clearly establishes the bonafides of the reasons prevailing with the assessee for not having made a claim for deduction u/s 10A of the Act in the return of income. Having regard to the peculiar facts and circumstances of the instant case, in our view, the stand of the Revenue that assessee cannot be allowed the benefits of section 10A of the Act merely because the prescribed Audit Report in Form No.56F was not filed in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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