Feedback   New User   Login      
Tax Management India. Com TMI - Tax Management India. Com
Acts / Rules Notifications Circulars Tariff/ ITC HSN Forms Case Laws Manuals Short Notes Articles SMS News Highlights
        Home        
Extracts
Home List
← Previous Next →

GVK Biosciences Pvt. Ltd. Versus Deputy Commissioner of Income Tax, Asst. Commissioner of Income Tax And Asst. Commissioner of Income Tax Versus GVK Biosciences Pvt. Ltd.

2018 (1) TMI 539 - ITAT HYDERABAD

Disallowance u/s. 14A - Held that:- The calculation u/s. 14A requires re-examination by the AO. In fact, as seen from the order, AO did not verify whether there is any direct expenditure or not. Assessee states that there is direct expenditure by way of cost of one employee at ₹ 2,30,000/-. Ld.CIT(A) without examining the issue has accepted the contention. Moreover, it is also noticed that the average of investments as stated by the AO seems to be not correct. The average of opening invest .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

aimed u/s. 80IB(8A) - Held that:- In the light of the decision of the ITAT in assessee’s own case for earlier years, which the Ld.CIT(A) has followed, we do not see any reason to differ from the order of the CIT(A). It is true that ITAT has stated that the claim has to be examined in each of the years and left a note of caution that the view taken therein may not apply to subsequent years, if there are change of facts. However, as seen from the approval granted, there are no change of facts and .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

. The Special Bench held the said discount on ESOP was to be allowed as deduction under section 37(1) of the Act, during the years of vesting on the basis of percentage of vesting during such period, subject to upward or downward adjustment at the time of exercise of option - Decided against revenue - Disallowance of communication charges while computing deduction u/s. 10A - Held that:- Assessee failed to furnish the amount of internet charges or any expenditure under this head. When this w .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ITAT MADRAS-D], wherein it has been held that communication charges etc., attributable to the delivery of the computer software outside India which are to be reduced from the export turnover should be reduced from the total turnover as well, while computing the deduction u/s. 10A. Therefore, following the ratio laid down in the aforesaid cases, we direct the AO to exclude the same amount from Total Turnover as well and re-workout the disallowance u/s. 10A. Grounds are partly allowed. - Disal .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

es’. The FIRC issued by the bank cannot be taken as a conclusive evidence, unless supported by actual research for which remittances are made. This aspect has not been examined by the AO at all. Moreover, the detailed explanation made before the CIT(A) has not been examined by the CIT(A). He has summarily rejected assessee’s contentions stating that ‘it does not hold water’. We are of the opinion that this issue requires re-examination by the AO based on the invoices raised and corresponding amo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nt Member For Assessee : Shri V. Siva Kumar, AR For Revenue : Shri K. Ashok Kumar, DR ORDER Per Bench These are cross-appeals by Assessee and Revenue for the AYs. 2009-10, 2010-11 & 2011-12 against the orders of the Commissioner of Income Tax (Appeals)-2, Hyderabad, dated 23-03- 2015. Since common issues are involved in all these appeals, these are heard together and decided by this common order. 2. Briefly stated, assessee is a company engaged in the business of Bio-Informatics, Contract Re .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

on charges from the Export Turnover alone and made adjustment in AY. 2009-10, whereas in AY. 2010-11 and 2011-12, AO denied the entire claim u/s. 10A on the reason that certain FIRCs issued by Kotak Mahindra Bank mentioned the purpose of remittance as research services and not as software exports and accordingly, assessee was not eligible u/s. 10A of the Act. There was also disallowance of ESOP expenditure in AY 2010-11 and 2011-12. 3. Before the Ld.CIT(A), assessee has made detailed submissions .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

Ld.CIT(A) allowed the assessee s contention, considering assessee s statement that company utilised the services of one employee for looking after the investment and cost of such employee was only ₹ 2,30,000/- and the said expenditures are sufficient to be considered and not 0.5% of the value of the average investment. Ld.CIT(A) did not give any reason but accepted assessee s contention and hence Revenue is aggrieved. 4.1. After considering the rival contentions, we are of the opinion tha .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

closing balance at ₹ 16,14,79,458/- results in average value of ₹ 30,32,12,130/- as against ₹ 17,17,32,670/- stated by the AO in the order. 0.5% thereon at ₹ 7,08,664/- was not correctly worked out. Therefore, without going into merits of the addition, we accept the Revenue s ground and restore the issue of entire disallowance u/s. 14A to the file of AO to be considered afresh, after giving due opportunity to assessee. The grounds are considered allowed for statistical p .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

rs. In appeal, Ld.CIT(A) allowed assessee s claim following the decision of ITAT in assessee s own case vide order in ITA No. 1276/Hyd/2010 dt. 02-08-2013 for AY. 2006-07 and also order in ITA No. 1053/Hyd/2013 dt. 06-02-2014 for the AY. 2008- 09. Revenue is aggrieved. 6. It was submitted that the approval granted to assessee while allowing deduction u/s. 80IB in AYs. 2006-07 and 2008-09 by the department has been renewed for the AYs. 2009-10, 2010-11 and 2011-12 vide letter No.TU/IV-R&D/Com .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

at the facts are to be examined in each of the years. 8. We have considered the rival contentions and perused the orders placed on record. In the light of the decision of the ITAT in assessee s own case for earlier years, which the Ld.CIT(A) has followed, we do not see any reason to differ from the order of the CIT(A). It is true that ITAT has stated that the claim has to be examined in each of the years and left a note of caution that the view taken therein may not apply to subsequent years, if .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ncial year relevant to the AY. 2010-11 and an amount of ₹ 32,00,042/- in financial year relevant for AY. 2011- 12 in the P&L A/c towards stock based compensation. AO following the decision of the ITAT in the case of Ranbaxy Laboratories Ltd., [124 TTJ 77] (Delhi) disallowed the deduction. In appeal, Ld.CIT(A) allowed the claim following the decision of the Special Bench of the Hon'ble ITAT, Bangalore in the case of Biocon Ltd., Vs. DCIT [144 ITD 21] [35 taxmann.com 335] (Bangalore .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

peal. Assessee furnished Form 56F and claimed deduction u/s. 10A on two of the units. AO noticing that there may be internet charges attributable to delivery of article/thing outside India, disallowed the claim of communication charges. (Bio-informatics Division, Balanagar, Hyderabad at ₹ 1,18,877/- & an amount of ₹ 11,082/- in Informatics Division, Chennai.) Aggrieved by the disallowance made u/s. 10A, assessee preferred an appeal before the Ld.CIT(A) and relied on various case .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

has held that inter net expenses could not be treated as communication charges under Clause-4 of Explanation-2 to Section 10A. However, assessee failed to furnish the amount of internet charges or any expenditure under this head. When this was pointed out, assessee s Counsel accepted for alternate contention that whatever is excluded from the export turnover should also be excluded from the total turnover on the principles laid down by the Hon'ble Bombay High Court in the case of CIT Vs. Gem .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

eduction u/s. 10A. Therefore, following the ratio laid down in the aforesaid cases, we direct the AO to exclude the same amount from Total Turnover as well and re-workout the disallowance u/s. 10A. Grounds are partly allowed. Disallowance of entire claim u/s. 10A: 13. In AYs. 2010-11 and 2011-12, AO disallowed the entire claim on Section 10A on the reason that some of the FIRCs issued by Kotak Mahindra Bank mentioned the purpose as research services . Since assessee has claimed the deduction for .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

dical research services. Therefore, there may be mistake in issuing the certificate but that does not prove that assessee has not exported software on which the claims are made. Referring to the order of assessment in AY. 2009-10 [which is also in appeal before us], the Ld. Counsel pointed out that from the same units, assessee has claimed deductions u/s. 10A which was allowed in earlier years but in these two years, AO took a different stand. 15. Ld.DR, however, relied on the orders of the AO a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

Discussion Forum
what is new what is new
 


Share:            

|| Home || About us || Feedback || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version