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2012 (8) TMI 432 - AT - Income TaxValidity of revisionary order passed u/s 263 dis-allowing deduction u/s 10A, invoking sub section 9 of Section 10A on ground of change in ownership - I.T. enabled services and BPO - Tribunal in AY 03-04, upheld the order passed u/s 263 on same ground - assessee contending retrospective omission of Section 10A(9) - Held that:- Purpose of Section 10A(9) was to curb the trading in incentives by shell companies, and to discourage unscrupulous shopping of EOUs and STPs. In the present case, in the year 2002, there was a change in the holding pattern by way of global re– orginasation of the business and nothing has been brought on record that such a re–orginazation was non–genuine or was solely for the purpose of shopping of STP for claiming the exemption. Also, sub–section 9 to section 10A, which has been omitted from the statute w.e.f. 1st April 2004, has to be read to be obliterated from the statute book or at least it will not have any effect from the year in which it was omitted. Thus, even if there was any change in the ownership through acquisition of shares in earlier year 2003–04, exemption u/s 10A, cannot be denied on this ground in the AY 2004–05. Further, in the present AY, no such provision was appearing in the statute and the AO was obliged to follow the law which was in force as on the first day of AY i.e., 1st April 2004; we hold that there was no error of law by the AO while allowing exemption u/s 10A in AY 2004–05 and the impugned order passed u/s 263 setting aside the assessment on the ground that deduction allowed u/s 10A is neither a correct finding nor correct in law. Order of Commissioner set aside - Decided in favor of assessee.
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