TMI Blog2014 (2) TMI 1247X X X X Extracts X X X X X X X X Extracts X X X X ..... Since the Assessing Officer in this case has only raised this issue, the same has to be not allowed in view of the discussions made above. Ground No. 1 therefore, is allowed. The Tribunal in the above relied cases have also allowed the benefit on the 'principle of consistency', which is applicable in this case also. It was demonstrated by the AR that similar benefit u/s 10B was allowed by AO in earlier assessment years and no action to J withdraw the same has been taken. - Decided in favour of assessee - ITA.No.131/PN/2013 - - - Dated:- 26-2-2014 - Shri Shailendra Kumar Yadav, Judicial Member, and Shri R.K. Panda, Accountant Member. For the Appellant : Shri Sunil Ganoo For the Respondent : Shri P.L. Pathade ORDER PER R.K. PANDA, AM: This appeal filed by the Revenue is directed against the order dated 16-08-2012 of the CIT(A)-I, Pune relating to Assessment Year 2009-10. 2. The grounds raised by the Revenue are as under : 1. The order of the learned Commissioner of Income-tax (Appeals) is contrary to law and to the facts and circumstances of the case. 2. The learned Commissioner of Income-tax (Appeals) grossly erred in deleting the disallowan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... I is not at par with the 100% EOU approved by the Board appointed u/s.14 of the IDRA, 1951 by the Central Government. For this proposition, the Assessing Officer relied on the decision of the Hyderabad Bench of the Tribunal in the case of Infotech Enterprises Ltd. Vs. Jt. CIT reported in 85 ITD 325. The Assessing Officer accordingly rejected the claim of ₹ 1,20,73,454/- claimed by the assessee u/s.10B of the I.T. Act. 3.1 In appeal the Ld.CIT(A) following his order for A.Y. 2008-09 allowed the claim of the assessee. 4. Aggrieved with such order of the CIT(A) the Revenue is in appeal before us. 5. The Ld. Departmental Representative heavily relied on the order of the Assessing Officer 6. The Ld. Counsel for the assessee on the other hand submitted that under identical facts and circumstances the Ld.CIT(A) in assessee s own case for A.Y. 2008-09 has allowed the claim of deduction u/s.10B amounting to ₹ 46,79,486/-. Although the tax effect is more than the monetary limits prescribed by the CBDT, the Revenue has not filed any appeal against the order of the CIT(A). Thus, the Revenue has accepted the order of the CIT(A) who has passed an elaborate order distingui ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ars. From the perusal of the assessment order it is abundantly clear that the AO has mainly relied on the non-fulfillment of condition provided in the section, to obtain the approval from the Board appointed on behalf of the Central Government u/s 14 of the Industries (Development Regulation) Act, 1951 which was found specifically available in Explanation 2 to sec. 10B which defines a 100% Export Oriented Unit (EOU), to which this provision applies. The AO found that the Explanation says that 100% export oriented undertaking means an undertaking which has been approved as a 100% export oriented undertaking by the Board appointed in this behalf by the Central Government in excise of power conferred by section 14 of the Industries (Development Regulation) Act, 1951 (65 of 1951, and the rules made under that Act). As the appellant had taken the approval of 100% export oriented unit from the STPI, a technical body of Ministry of Information Technology formed for the purpose of control, monitoring and regulation of software exports, it was held by the AO that the status of EOU for the purpose of deduction u/s 10B cannot be recognized. The AO for the above has also placed reliance ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad also contended before the AO that the definition available in the section in Explanation 2 of section 10B clearly says that a computer software means any computer programme recorded on any disk, tape, perforated media, or other information storage device or any customized electronic data or any product or service of similar nature will constitute software which are exported or transmitted from India to any place outside India by any means. The AO has not examined any of these claims of the appellant before saying in an ambiguous manner that the appellant is not engaged in the activity of software manufacturing on the basis of salary and note on activity. Therefore, it is clear from the perusal of the assessment order that the AO has failed to appreciate the materials placed before her in the light of the provisions contained u/s 10B and the interpretations given to the relevant issues in different judgments and has concluded without any basis that the appellant is not engaged in the business of manufacturing of software. In view of the above and the fact that the submissions of the appellant has remained uncontroverted, demonstrating that the appellant is engaged in the activity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 135/Del/2011/A.Y. 2003-04); CITVs. Excell Softech Ltd. (2008)219 CTR (P H) 405. It can be seen that the finding of the Assessing Officer that sec. 10B required registration by the Board constituted u/s 14 of Industries (Development Regulation) Act, 1951, is perfectly correct but the claim of the appellant that the above requirement should be construed to have been legally fulfilled as per the directions of the Ministry of Communication Technology and the Instruction issued by the CBDT on a similar issue for registration u/s 10A, also looks correct. Instruction No. 1 of 2006 of the CBDT dated 31.3.2006, is in respect of sec. 10A but in this Instruction it has been accepted that confusion existed in respect of the authorities whose approval should be considered to be fulfilling the conditions prescribed in sec. 10A and in view of the same the Instruction directed the Assessing Officer as under: 6. The matter has been examined in consultation with the Officers of the Department of Information Technology (earlier, Department of Electronics). In view of the ambiguity in the legal status of the approval by Director of STPs, the Inter-Ministerial Standing Committee will meet to c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efit u/s 10B was allowed by AO in earlier assessment years and no action to J withdraw the same has been taken. Thus on this basis also Ground No. 1 is required to be allowed. 7.1 We find although the tax effect was more than the prescribed monetary limit the Revenue has not filed any appeal against the order of the CIT(A) for the A.Y. 2008-09. We find the CIT(A) while allowing the appeal of the assessee for A.Y. 2009-10 has followed his earlier order under identical facts and circumstances. We find the Ld.CIT(A) in his order for A.Y. 2008-09 has distinguished the decision of the Hyderabad Bench of the Tribunal in the case of Infotech Enterprises Ltd. (Supra) and following various other decisions has allowed the claim of deduction u/s.10B. The Ld. Departmental Representative could not point out any mistake in the order of the Ld.CIT(A) nor could cite any other decision to controvert the finding given by the Ld.CIT(A). Since the order of the CIT(A) is based on various decisions including the CBDT Instruction No.1/2006, therefore, in absence of any contrary material brought to our notice, we find no infirmity in the order of the CIT(A). Accordingly, we uphold the same. The ground ..... X X X X Extracts X X X X X X X X Extracts X X X X
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