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TMI Blog2021 (9) TMI 657X X X X Extracts X X X X X X X X Extracts X X X X ..... e Mr.Justice Sathi Kumar Sukumara Kurup For the Appellant : Mrs.R.Hemalatha, Senior Standing Counsel. For the Respondent : Mr.R.Vijayaraghavan for M/s.Subbaraya Aiyar Padmanabhan JUDGMENT T.S.SIVAGNANAM, J . This Appeal filed under Section 260-A of the Income Tax Act, 1961 ('the Act' for brevity) is directed against the order dated 19.12.2016 in I.T.A.No.1413/Mds/2015 passed by the Income Tax Appellate Tribunal B Bench, Chennai ('the tribunal' for brevity) for the Assessment Year 2009-2010. 2.The Appeal was admitted on 18.10.2016 to decide the following substantial questions of law; 1.Whether on the facts and circumstances of the case, the Tribunal was right in holding that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The operative portion of the judgment reads as follows:- 4.It is not disputed before us that all the substantial questions of law, which have been framed for consideration in these appeals, have been considered by the Division Bench of this Court in the case of CIT vs. SRA Systems Ltd., [T.C.A.No.975 of 2010 dated 02.03.2021]. The relevant paragraphs of the judgment read as follows:- 4. When the appeal is taken up for hearing, Mr.R.Sivaraman, learned counsel appearing for the respondent submitted that the Question of Law no.1 is covered by the decision of the Hon'ble Supreme Court reported in [2018] 93 taxmann.com 33 (SC) [Commissioner of Income-tax, Central III Vs. HCL Technologies Ltd.], an un-reported judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rave injustice to the Respondent which could have never been the intention of the legislature. 20.Even in the common parlance, when the object of the formula is to arrive at the profit from export business, expenses excluded from export turnover have to be excluded from total turnover also. Otherwise any other interpretation makes the formula unworkable and absurd. Hence, we are satisfied that such deduction shall be allowed from the total turnover in same proportion as well. 21.On the issue of expenses on technical services provided outside, we have to follow the same principle of interpretation as followed in the case of expenses of freight, telecommunication etc., otherwise the formula of calculation would be futile. Hence, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed on 17.12.2007, disallowing the entire claim of deduction under Section 10B. Further, the expenditure incurred for the renovation and repairs of the rented premises of the assessee Company was disallowed by the Assessing Officer on the ground that such expenses were in the nature of capital expenditure. The Assessing Officer in his re-assessment order noted that in terms of Section 10B(ii) an undertaking in order to be eligible for deduction under Section 10B must not be formed by splitting up or reconstruction of a business already in existence. Further, the Assessing Officer held that deduction under Section 10B was not available to the assessee Company in view of the provisions of Section 10B(iii) which stipulate that eligible busin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5.2008 made in I.T.A.No.2255/Mds/06 for the Assessment Year 2002-03 and dismissed the appeal. In view of the judgment of the Hon'ble Division Bench of this Court, it is clear that the applicability of Clauses (ii) and (iii) of Sub Clause (2) to Section 10B of the Act, the impugned order passed by the Income Tax Appellate Tribunal is proper. In view of the order passed by the Income Tax Appellate Tribunal dated 16.05.2008 in I.T.A.No.2255/Mds/06 and the judgment passed by the Hon'ble Division Bench of this Court on 26.10.2018 in Tax Case Appeal No.1916 of 2008, the assessee Company would be entitled to deduction under Section 10A and disallowance made by the Assessing Officer was not correct. Since the order passed under Section 263 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion and unabsorbed depreciation from earlier years. 29.This method of computing the income in the present case made by the Revenue is totally against the said law as has been declared by te Hon'ble Apex Court in the aforesaid decision in Commissioner of Income-tax v. Yokogawa India Ltd., (cited supra). 30.Therefore we have no hesitation to hold that, the decision of the ITAT, which is impugned herein, would not stand in the legal scrutiny, in view of the law having been declared by the Hon'ble Apex Court. Therefore, we are of the view that, the Substantial Question of Law raised in this Appeal is covered by the said decision, therefore, it can be answered accordingly. 6. Mr.J.Narayanasamy, learned Senior Sta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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