TMI Blog2019 (9) TMI 1546X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Learned PCIT in order to invoke the provision of section 263 of the Act in order to reopen the assessment of the appellant company. Hence, the order impugned is being devoid of any merit and thus quashed. Assessee s appeal is allowed. - I.T.A. No. 1356/Ahd/2016 - - - Dated:- 4-9-2019 - Shri Pramod Kumar, Vice President And Ms. Madhumita Roy, Judicial Member For the Appellant : Shri S. N. Soparkar Parin Shah, A.R. For the Respondent : Shri Alok Singh, CIT-D.R. ORDER Per Ms. Madhumita Roy - JM: The instant appeal filed by the Assessee is directed against the order dated 30.03.2016 passed by the Pr. Commissioner of Income Tax 2, Ahmedabad under section 263 of the Income Tax Act, 1961 (hereinafter referred as to the Act ) arising out of the order dated 27.05.2013 passed by the Deputy Commissioner of Income Tax, Ahmedabad for Assessment Year 2009- 10. 2. The assessee has challenged the initiation of revision proceeding u/s 263 of the Act and has also claimed the deduction u/s 10A of the Act before setting off brought forward losses. The Learned Counsel appeared for the assessee basically argued on the point of merit of the matter regarding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led that deduction u/s 10A of the Act is to be allowed before set off of brought forward losses / loss from ineligible unit. On this aspect, Learned AR relied upon the order passed by the Jurisdictional High Court in the matter of CIT-vs-Indusa Infotech Services (P.) Ltd. On the other hand, Learned DR relied upon the order passed by the authorities below. 4. Heard the respective parties, perused the relevant materials available on record including the order passed by the Jurisdictional High Court. On this particular issue, the relevant portion whereof is as follows: 3.1 The assessee-company filed its return of income for the AY 2005-06 declaring total income of Rs. NIL. The said return was processed and accepted by the Assessing Officer. However, after recording the reasons, the case was re-opened and a notice under section 148 of the Income-tax Act, 1961 ( Act for short) was issued on 9th January 2009. In response to the notice, the assessee filed return on 12th February 2009 declaring the same income. A further notice under section 143(2) of the Act was issued by the Assessing Officer on 14th July 2009, followed by yet another notice under section 142(1) of the Act. 3. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by CIT (A) as well as that of the Assessing Officer. 6. Feeling aggrieved and dissatisfied with the impugned common order dated 8th March 2024 passed by the Tribunal in ITA Nos. 3404; 2405 3406/Ahd/2010 with respect to A.Ys 2005-06; 2006-07 2007-08, the Revenue has preferred the present Tax Appeals, raising aforementioned question of law. 7. Ms. Mauna Bhatt, learned advocate appearing for the appellant- Revenue has not disputed the position that the issue/question involved in the present Tax Appeals is covered by the decision of the Bombay High Court in case of Black Veatch Consulting (P.) Ltd. (supra) and Schmetz India (P.) Ltd. (supra). She also is also not in a position to dispute that the issue/question raised in the present Tax Appeals is also covered by the decision of this Court in case of CIT v. ACE Software Exports Ltd. [Tax Appeal No. 687/2012] wherein the Division Bench of this Court, relying on the aforesaid two decisions of the Bombay High Court, has held the question against the Revenue. 8. However, she has submitted that in view of the decisions of Madras High Court in case of CIT v. Chemplast Sanmar Ltd. [2009] 314 ITR 231/180 Taxman 335; of K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 001. Prior to the substitution of the provision, the earlier provision stipulated that any profits and gains derived by an assessee from a 100 per cent export oriented undertaking, to which the section application shall not be included in the total income of the assessee . The provision, therefore, as it earlier stood was in the nature of an exemption. After the substitution of section 10B by the Finance Act of 2000, the provision as it now stands provides for a deduction of such profits and gains as are derived by a 100 per cent export oriented undertaking from the export of articles or things or computer software for ten consecutive assessment years beginning with the assessment year relevant to the previous year in which the undertaking begins to manufacture or produce. Consequently, it is evident that the basis on which the assessment has sought to be reopened is belied by a plain reading of the provision. The Assessing Officer was plainly in error in proceeding on the basis that because the income is exempted, the loss was not allowable. All the four units of the assessee were eligible under section 10B. Three units had returned a profit during the course of the assessment ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Tribunal would have to be affirmed since it is plain and evident that the deduction under section 10A has to be given at the stage when the profits and gains of business are computed in the first instance. So construed, the appeal by the Revenue would not give rise to any substantial question of law and shall accordingly stand dismissed. There shall be no order as to costs. 10.3 It is reported that the decision of Division Bench of the Bombay High Court in case of Black Veatch Consulting (P.) Ltd. (supra) has been subsequently followed by the Bombay High Court in case of Schmetz India (P.) Ltd. (supra). It is also reported that in Tax Appeal No. 687 of 2012, the Division Bench of this Court had an occasion to consider identical issue/question, and relying on the aforesaid two decisions of the Bombay High Court in case of Black Veatch Consulting (P.) Ltd. (supra) and Schmetz India (P.) Ltd. (supra) and concurring with the view taken by the Bombay High Court in the aforesaid two decision, the Division Bench has dismissed the Tax Appeal and held the aforesaid issued against the Revenue. 11. In view of the above facts and circumstances and the binding decision of thi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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