| The Tax Publishers2020 TaxPub(DT) 3956 (Karn-HC) INCOME TAX ACT, 1961
Section 10A
Where assessee was engaged on site development of software program, which were delivered at premises of client at the work site in South Korea, there was no need for full-fledged infrastructure facilities in India and thus, industrial undertaking of assessee was independent of all undertakings which it was already possessing, therefore, assessee was entitled to deduction under section 10A.
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Deduction under section 10A - Allowability - Denial of deduction on allegation that no new unit was set up by assessee -
Assessee filed its return of income claiming deduction under section 10A. AO denied deduction under section 10A on allegation that though assessee claimed deduction under section 10A, yet from statement filed by assessee, it was evident that changes were made to existing unit and no new unit was set up. Held: In instant case, assessee was engaged on site development of software program. The programs were delivered at premises of the client at the work site in South Korea. Activities of assessee finally culminated at work site of clients at South Korea and there was no need for full fledged infrastructure facilities in India. Thus, industrial undertaking of the assessee was independent of all undertakings which it was already possessing. Therefore, assessee was entitled to deduction under section 10A.
Followed:M/s. Mangalore Ganesh Beedi Works v. CIT, Mysore & Anr. (2015) 378 ITR 640 (SC) @ 648) : 2015 TaxPub(DT) 4100 (SC) Sudarshan Silks & Sarees v. CIT (2008) 300 ITR 205 SCC @ 211 : 2008 TaxPub(DT) 1908 (SC)
REFERRED : Dy. CIT, Circle 11 (1), Bangalore v. M/s. Ace Multi Axes Systems Ltd. (2017) 88 taxmann.com 69 (SC) : 2017 TaxPub(DT) 5071 (SC) Union of India v. Ibrahim Uddin & Anr (2012) 8 SCC 148 Vijay Kumar Talwar v. CIT (2012) 8 SCC 148 : 2011 TaxPub(DT) 0693 (SC) Hero Vinoth (Minor) v. Seshammal (2006) 5 SCC 545 Santosh Hazari v. Puroshottam Tiwari (2001) 3 SCC 179 : 2001 TaxPub(DT) 1102 (SC) The Pr. CIT-6 v. Macquarie Global Services (P) Ltd. (2019) 102 taxmann.com 272 (DEL) : 2019 TaxPub(DT) 0746 (Del-HC) Pr. CIT and Asstt. CIT v. M/s. Softbrands India (P) Ltd. (2018) 406 ITR 513 (Karn) : 2018 TaxPub(DT) 3520 (Karn-HC) CIT & Anr. v. Quest Informatics (P) Ltd. (2015) 372 B ITR 526 (KAR) : 2015 TaxPub(DT) 1598 (Karn-HC) CIT, Central Circle, Bangalore v. Wipro GE Medical System Ltd. (2015) 50 taxmann.com 181 (KAR) CIT and ITO v. Expert Outsource (P) Ltd. (2011) 358 ITR 518 (KAR) : 2011 TaxPub(DT) 0956 (Karn-HC) Jt. CIT (OSD) Circle-12 (5), Bangalore v. M/s. Valdel Engineers & Constructors (P) Ltd. [ITA No. 1370/Bang/2011, dt. 28-9-2012] ACIT v. Valdel Engineers and Constructions (P) Ltd. [ITA Nos. 616 to 618/Bang/2008, dt. 10-11-2010]
FAVOUR : In assessee's favour
A.Y. : 2007-08
IN THE KARNATAKA HIGH COURT
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