TMI Blog2020 (11) TMI 653X X X X Extracts X X X X X X X X Extracts X X X X ..... at if the nature of activity of the assessee is maintenance of computerized database with regard to various types of qualified Information Technology personnel available in India and the company provides the customers with information to potential candidates, which would meet the requirements on the customers. Role of the company is to create an electronic database of qualified personnel and transmit data through electronic means to the client. CIT (Appeals) has also found that the assessee is in the business of supply of manpower from India to its Foreign clients after their recruitment in India. Thus, irrespective of the fact whether or not the assessee provides training to its employees or to the employees who are recruited by its cli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f human resources services are IT enabled services, when the assessee was only making available the data base of qualified IT personnel and entitled to deduction under Section 10A of the Act and recorded a perverse finding? 2. The factual background, in which the aforesaid substantial questions of law arise for consideration in this appeal needs mention. The assessee is a private limited company and is in the business of software development and professional services. During the Assessment Year 2007-08, the assessee had 6 separate units, each in Bangalore and Chennai. The assessee filed the return of income for the Assessment Year 2007-08 on 31.10.2007 and claimed deduction under Section 10A of the Act only in respect of five units viz ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the data of qualified Information Technology personnel is human resource services and Information Technology enabled services. Accordingly, the appeal preferred by the assessee was allowed and the appeal preferred by the revenue was dismissed as infructuous. In the aforesaid factual background, this appeal has been filed. 4. Learned counsel for the revenue submitted that the assessee is not engaged in human resource services and is engaged only in the business of placement which is akin to a commission agent and therefore, the benefit of deduction under Section 10A of the Act cannot be granted to the assessee. It is urged that mere compilation of information of certain candidates in computers does not amount to Information Technology en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the order requires reconsideration in view of law laid down by Supreme Court in ML OUTSOURCING SERVICES (P.) LTD. supra. It is also pointed out that the assessee during the course of hearing submitted that it is imparting training to its own employees also. Therefore, possibility of training expenses referred to by the tribunal may have been incurred by the assessee for training its own employees. It is also pointed out that factual analysis as to whether training has been imparted to the persons mentioned in the list, which was shared with the other companies is required. Lastly, it was urged that the fact whether or not the assessee had incurred expenses for training of its own employees or for the employees of other companies require ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecial provision in respect of newly established undertaking in Free Trade Zone (FTZ) and provides for deduction. The relevant extract of Section 10A reads as under: 10A. (1) Subject to the provisions of this section, a deduction of such profits and gains as are derived by an undertaking from the export of articles or things or computer software for a period of 10 consecutive assessment years beginning with the assessment year relevant to the previous year in which the undertaking begins to manufacture or produce such articles or things or computer software, as the case may be, shall be allowed from the total income of the appellant : Xxxxxx (2) This section applies to any undertaking which fulfils all the following condition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service of similar nature'. The Board has issued a Notification dated 26.09.2000 and the aforesaid Notification admittedly contains human resources as well as Information Technology enabled product or services. The relevant extract of the Notification, is reproduced below for the facility of reference: In exercise of the powers conferred by clause (b) of item (i) of Explanation 2 of section 10A, clause (b) of item (i) of Explanation 2 of section 10B and clause (b) of Explanation to section 80HHE of the Income tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby specifies the following information technology enabled products or services, as the case may be, for the purpose of said clauses, namely :- (i) Back-offic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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