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2014 (3) TMI 1162 - HC - Income TaxComputer software as clubbed with computers as the depreciable asset @60% - HELD THAT:- Both the CIT (Appeals) and the Tribunal found that the software cannot be seen in isolation and delinked from the computer. The reasons that are assigned is that what has been always understood as obvious is now apparent by the amendment. CIT(Appeals) found that in the case of the present assessee, the software cannot be worked in isolation. It has to be loaded on the computer. Therefore, in the present case, it is an intergral part of the computer. In these circumstances, the finding of fact does not require any interference in our appellate jurisdiction as the same does not raise any substantial question of law. Exemption u/s 10A - income generated from training given to the customer for the use of the software - HELD THAT:- There is a finding of fact that the training activity is incidental to the sale made by the assessee company in respect of the products manufactured. Unless the users are trained, further sales are going to be affected. This receipt is therefore closely related to the manufacturing activity carried out by the assessee. In these circumstances and when the findings of fact have been confirmed by the Income Tax Appellate Tribunal, but for some different reasons that we are of the opinion that this Appeal does not give rise to any substantial question of law. Therefore, we are of the opinion that the income generated from training given to the customer for the use of the software in this case was eligible for exemption under section 10A. TP Adjustment - computation of Arm's Length Price along with the price in relation to international transactions entered into by the assessee with it's subsidiaries as commission has been paid on customisation fees - argument was that the assessee has subsidiaries which act as a sale and marketing office of the assessee. The nature of the transaction is essentially of re-sale - HELD THAT:- The ultimate sale prices are negotiated by the subsidiaries directly with the end-customers and assessee's offers are negotiated. Therefore, when there are subsidiaries, but local independent distribution agents to whom a commission has been given then, the ultimate margin offered and paid to the subsidiaries is only 10%. In other words, there has not been found to be a variation of such nature as would enable the Assessing Officer to question the payment. In such circumstances, the finding of fact which has been rendered cannot be said to be vitiated by any perversity or any error of law apparent on the face of record. The reasons assigned by the Tribunal in paragraph no.18 of the order are based essentially on the nature of the dealings. Once the subsidiaries are found to be collecting the customization work and which work was not being done by independent distributors, then, the justification has been rightly accepted. No substantial question of law
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