The Commissioner Of Income Tax-Iv vs M/S Oks Span Tech Pvt. Ltd.
2014 Latest Caselaw 6773 Del

$~2.
*IN THE HIGH COURT OF DELHI AT NEW DELHI
+       INCOME TAX APPEAL NO. 750/2014 & CM NO. 20412/2014
                                      Date of decision: 15th December, 2014
        THE COMMISSIONER OF INCOME TAX-IV ..... Appellant
                          Through Mr. Ruchir Bhatia, Advocate.

                          versus

        M/S OKS SPAN TECH PVT. LTD.               ..... Respondent
                      Through Nemo.

        CORAM:
        HON'BLE MR. JUSTICE SANJIV KHANNA
        HON'BLE MR. JUSTICE V. KAMESWAR RAO

SANJIV KHANNA, J. (ORAL):

        There is delay of 400 days in re-filing of the present appeal.

However, before issuing notice on the application for condonation of delay,

we deem it appropriate to examine the merits.

2.      This appeal by the Revenue pertains to Assessment Year 2007-08

and impugns order dated 16th November, 2012 passed by the Income Tax

Appellate Tribunal (Tribunal, for short).

3.      The assessee company filed its e-return, declaring income of Rs.

5,18,353, on 25.10.2007. The assessee claimed deduction amounting to

Rs.3,03,94,780/- under section 10B of the Income Tax Act,1961 (Act, for

short) in respect of income derived from its 100% export oriented units,

situated at Chennai and Gurgaon. The said two units were engaged in

business of export of computer software.
ITA 750/2014                                                         Page 1 of 3
 4.      The Assessing Officer disallowed the claims under section 10B for

the two reasons. Firstly, he held that development and export of computer

software was not eligible under Section 10B as the assessee had not

produced or manufactured any good, articles or thing.                 The aforesaid

reasoning of the Assessing Officer has been rightly rejected by the

Commissioner of Income Tax (Appeals) as well as the Tribunal in view of

the circular No. 794 dated 9.8.2000 issued by the Central Board of Direct

Taxes and amendment in Section 10B w.e.f 1.4.2001. In fact, the Revenue

has not raised the said issue in the present appeal.

5.      The second ground given by the Assessing Officer was that the

assessee having two separate units eligible under section 10B was required

to file two separate reports in form 56G in respect of each unit, whereas

assessee had submitted only one auditor report in form 56G for both of its

two units, i.e., the unit located at Chennai and Gurgaon.

6.      Section 10B(5) of the Act reads :-

               10B.

                   XXXXXXX

               (5) The deduction under sub-section (1) shall not be admissible for any
               assessment year beginning on or after the 1st day of April, 2001, unless
               the assessee furnishes in the prescribed form, along with the return of
               income, the report of an accountant, as defined in the Explanation below
               sub-section (2) of section 288, certifying that the deduction has been
               correctly claimed in accordance with the provisions of this section.

        The Commissioner of Income Tax (Appeals) [(C.I.T(A), for short],

reversing the findings of the Assessing Officer, has referred to Form 56G

ITA 750/2014                                                                 Page 2 of 3
 as filed and had recorded that the Chartered Accountant in form No. 56G,

had bifurcated and computed the income derived from exports of software

for the Gurgaon and Chennai Unit, separately. The requisite information

and details for each unit as per the mandate of section 10B were duly

furnished and filed. Thus full particulars and details had been separately

provided in respect of both units. It was immaterial whether the assessee

furnished a separate form for each unit or full and complete details of each

unit were furnished separately but in a single form. ITAT has affirmed the

said reasoning given by the C.I.T (A).

7.      It is apparent that the bifurcation of the exempt income for each unit

was clearly stated and given. It is not the case of the revenue that certain

aspects were not clear or concealed or eligible profits of each unit could not

be ascertained. No such assertion and contention is raised. Copy of the

form has also not been filed.         The view taken by the Revenue is

hypertechnical and does not merit issue of notice in the present appeal.

8.      In view of the aforesaid, we are not inclined to issue notice on the

application for condonation of delay in re-filing and as a sequitur, the

appeal itself will be treated as dismissed.


                                         SANJIV KHANNA, J.

V. KAMESWAR RAO, J. DECEMBER 15, 2014 VKR