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TMI Blog2021 (1) TMI 1041X X X X Extracts X X X X X X X X Extracts X X X X ..... nces of the case, the Honourable ITAT was right in law in upholding the initiation of proceedings under section 263 in respect of an order which got merged with the consequential order under section 143(3) of the IT Act dated 17-01-2012? (iii) Whether on the facts and in the circumstances of the case, the Honourable ITAT was right in law in upholding the order under section 263 of IT Act by the learned First Respondent though the latter was himself unclear as to the correctness of action of the Learned Assessing Officer in allowing tax holiday under section 10A? (iv) Whether on the facts and in the circumstances of the case, the Honourable ITAT was right in law in upholding the initiation of proceedings under section 263 though there is no lack of enquiry? (v) Whether on the facts and in the circumstances of the case, the Honourable ITAT was right in law in upholding the denial of benefit of section 10A for AY 2008-09 on the ground that the appellant's tax holiday period expired prior to AY 2008-09? . (vi) Whether on the facts and in the circumstances of the case, the Honourable ITAT was right in law denying the claim of the appellant to treat each unit as a separate un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t eligible to claim deduction under Section 10A of the Act for Assessment Year 2008-09 as the period of 10 years in the case of assessee expired with Assessment Year 2007-08 and the Assessment Year in case of assesse has to be reckoned from Assessment Year 1998-99. It was also mentioned that the assessee is deriving the revenue from 'staffing' from STPI unit. Therefore, the assessee is not engaged in export of computer software. It was further held that the Assessing Officer did not examine the aforesaid aspect of the matter and has wrongly allowed the deduction under Section 10A of the Act. It was further held that the order of assessment has been passed without proper application of mind and therefore, order of assessment passed by the Assessing Officer is erroneous and is prejudicial to the interest of the revenue. The assesse thereupon was asked to file his objections and was given an opportunity of being heard. After affording an opportunity of hearing to the assessee, the Commissioner of Income Tax (Appeals) by an order dated 23.01.2013 set aside the order of assessment made by the Assessing Officer with the direction to the Assessing Officer not to allow deduction under Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... OF INCOME TAX VS. YOKOGAWA INDIA LTD.', (2012) 341 ITR 385 (KAR). It is also urged that even if the view taken by the Assessing Officer is not legally tenable but since, the order passed by the Assessing Officer was subjected to appeal before Commissioner of Income Tax (Appeals) in respect of Section 10A of the Act. Therefore, the powers under Section 263 of the Act could not have been invoked in the fact situation of the case. In support of aforesaid submission, reliance has been placed on decision of Gujarat High Court in 'CIT VS. NIRMA CHEMICAL WORKS (P) LTD', (2009) 182 TAXMAN 183 (GUJ). It is also urged that tribunal wrongly distinguished the decision rendered in Nirma Chemical Works (P) Ltd. supra. It is also urged that the alternate claim made by the assessee ought to have been considered and due enquiries were made by the Assessing Officer during the scrutiny proceeding and on the issue of staffing, a view was taken and the view taken by the Assessing Officer on tax holiday was a plausible view and the revisional powers could not have been invoked as the order of the Assessing Officer was subject matter of the appeal. 8. On the other hand, learned counsel for the revenue s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n under Section 10A of the Act was never examined by the Assessing Officer and the Assessing Officer has to record a finding that the activities carried on by the assessee constitute human resource services to be eligible for deduction under Section 10A of the Act. It is further submitted that since, the order passed by the Assessing Officer was erroneous and was prejudicial to the interest of the revenue, therefore, the powers have rightly been invoked by Commissioner of Income Tax (Appeals). In support of aforesaid submissions, reliance has been placed on 'COMMISSIONER OF INCOME-TAX VS. DSL SOFTWARE LTD.', (2012) 18 TAXMANN.COM 151 (KARNATAKA), 'COMMISSIONR OF INCOME TAX-II, NEW DELHI VS. ML OUTSOURCING SERVICES (P.) LTD.', 228 TAXMAN 54 (DELHI), 'SAINT GOBAIN CRYSTALS & DETECTORS (I) LIMITED VS. DEPUTY COMMISSIONER OF INCOME- TAX, ITA NO.441/2015, THE COMMISSIONER OF INCOME-TAX VS M/S NTT DATED GLOBAL ADVISORY', ITA NO.544/2013. 10. We have considered the submissions made by learned counsel for the parties and have perused the record. Before proceeding further, it is apposite to take note of the relevant extract of Section 263 of the Act, which reads as under: 263. Revision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . In the instant case, the period of 10 consecutive years would start from Assessment Year l995-96 and would end with Assessment Year 2008-09. It is pertinent to mention here that the period of 10 year commences from 1995-96 irrespective of the fact that whether or not the assessee has claimed benefit in between the Assessment Years and the period of 10 consecutive years therefore, in view of the plain language of the enactment cannot be extended. The Assessing Officer without examining the aforesaid aspect of the matter granted the benefit of deduction Section 10A of the Act to the assessee. The view taken by the Assessing Officer cannot but be said to be erroneous and prejudicial to the interest of the revenue. The view taken by the Assessing Officer cannot be said to be a plausible view. It is also pertinent to mention here that no reasons have been assigned by the Assessing Officer for holding the assessee eligible for benefit of deduction under Section 10A of the Act. Since, the issue with regard to eligibility of the assessee for deduction under Section 10A of the Act for Assessment Year 2008-09 beyond a period of 10 consecutive years was not subject matter of order of assess ..... X X X X Extracts X X X X X X X X Extracts X X X X
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