TMI Blog2015 (7) TMI 1273X X X X Extracts X X X X X X X X Extracts X X X X ..... - - - Dated:- 17-7-2015 - Smt. P. Madhavi Devi, Judicial Member And Shri Jason P. Boaz, Accountant Member Appellant By : Shri H.N. Khincha, C.A. Respondent By : Shri P. Dhivahar, JCIT (D.R) ORDER Shri Jason P. Boaz, A.M. : This appeal by the assessee is directed against the order of the Commissioner of Income Tax (Appeals)-IV, Bangalore dt.24.2.2012 for Assessment Year 2008-09. 2. The facts of the case, briefly, are as under :- 2.1 The assessee, an Indian Company engaged in the business of export of software and ITES, filed its return of income for Assessment Year 2008-09 on 18.12.2008 declaring NIL income. In the return of income, the income from business was computed at ₹ 63,02,287; which include ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which the total income of the assessee is enhanced after computation of income under this sub-section. The Assessing Officer held that the assessee's claim and contentions defeats the purpose for which Section 92C of the Act was legislated. It was also stated that the decision of the co-ordinate bench of the Bangalore Tribunal in the case of iGate Global Solutions Ltd. (supra) had not been accepted and the Department has preferred an appeal against the said decision before the Hon'ble Karnataka High Court. In that view of the matter, the Assessing Officer did not allow the assessee's claim for deduction under Section 10A of the Act in respect of the suo moto T.P. Adjustment of ₹ 28,61,352 and the same was separately assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the notice of the Tribunal in the case of iGate Global Solutions Ltd.. In respect of the reduction of telecommunication expenses only from export turnover, the learned CIT (Appeals) relied upon the decision of the Hon'ble Karnataka High Court in the case of CIT V Tata Elxsi ltd. Others (2011) 247 CTR 334 (Kar) to hold that the said expenses should be reduced both from export turnover as well as total turnover. 4. Aggrieved by the order of the CIT (Appeals) IV, Bangalore dt.24.2.2012 for Assessment Year 2008-09, in denying its claim for deduction under Section 10A of the Act in respect of the suo moto T.P. Adjustment of ₹ 28,61,352, the assessee has preferred this appeal raising the following grounds :- 1. The order o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pported the orders of the authorities below. 6.3.1 We have heard the rival contentions and submissions and perused and carefully considered the material on record; including the judicial pronouncements placed reliance upon. We find that on similar facts, as in the case on hand, the co-ordinate bench of this Tribunal in the case of iGate Global Solutions Ltd. (supra) allowed deduction under Section 10A of the Act in respect of Suo Moto T.P. Adjustment made by the assessee and held as under at paras 2.1 to 23 thereof as under :- 21. The last grievance is in respect of not allowing deduction under Section 10A on the adjustment made by the assessee to the arm s length price. 22. In the instant case, the assessee company entered in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y which the total income of the assessee is enhanced after computation of income under sub-section. 23. From the Memo Explaining the Provisions of Finance Bill, 2006 as well as from the literal meaning of the word enhanced , it is clear that if income increased, as a result of computation of arm s length price, then such increase is not to be considered for deduction under Section 10A. In the instant case, the assessee himself has computed the arm s length prices and has disclosed the income on the basis of arm s length prices. It is not a case, where there is an enhancement of income due to determination of arm s length price. Hence, it is held that assessee was entitled to deduction under Section 10A in respect of income declared in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee and against the Revenue. 6.3.3 The Hon'ble jurisdictional High Court in the above decision (supra) has allowed the assessee's claim for deduction under Section 10A of the Act in respect of Suo Moto T.P. Adjustment made by the assessee. In our view, the decision of the Hon'ble High Court of Karnataka in the case of Yokogawa India Ltd. Reported in (2012) 341 ITR 385 relied on by the learned CIT (Appeals) does not deal with the question of allowability of deduction under Section 10A of the Act, in respect of Suo Moto T.P. Adjustment made by the assessee while determining the Arm s Length Price of its international transactions. The said judgment deals with the issue of whether deduction under Section 10A of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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