Ita/219/2023 Of The Pr Commissioner Of Income Tax v. M/S Hewlett Packard(India)

Digitallysigned by BLAVANYALocation:HIGHCOURT OFKARNATAKA IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 1 DAY OF OCTOBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO.219 OF 2023 BETWEEN: 1. THE PR COMMISSIONER OF INCOME-TAX 5 FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU-560 095 OF INCOME-TAX 5 FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU-560 095 2. THE ASST. COMMISSIONER OF INCOME-TAX CIRCLE 3(1)(2) 2 FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, BENGALURU-560 095 …APPELLANTS (BY SRI. DILIP M., ADVOCATE ALONG WITH SRI RAVIRAJ Y.V., ADVOCATE) AND: M/S. HEWLETT PACKARD(INDIA) SOFTWARE OPERATION PVT. LTD., - 2 - NC: 2024:KHC:41184-DBITA No. 219 of 2023 SURVEY NO.192, WHITEFIELD ROAD, MAHADEVAPURA BENGALURU-560 048 PAN: AAACH 7164B …RESPONDENT (BY SMT. TANMAYEE RAJKUMAR, ADVOCATE) THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, PRAYING TO ALLOW THE APPEAL AND SET ASIDE THE ORDERS PASSED BY THE INCOME-TAX APPELLATE TRIBUNAL, BENGALURU IN IT(TP)A NO.2866/BANG/2017 DATED 10.03.2021 FOR ASSESSMENT YEAR 2013-2014 (ANNEXURE-D) AND CONFIRM THE ORDER OF THE DRP CONFIRMING THE ORDER PASSED BY THE ASSISTANT COMMISSIONER OF INCOME-TAX, CIRCLE-3(1)(2), BENGALURU AND ETC. THIS APPEAL IS COMING ON FOR HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.G.PANDIT AND HON'BLE MR JUSTICE C.M. POONACHA ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT) Heard the learned counsel Sri.Dilip.M., along with Sri. Raviraj.Y.V., learned counsel for appellants/Revenue and learned counsel Smt.Tanmayee Rajkumar for respondent/assessee. 2. The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short, ‘the Act’) questioning the correctness and legality of order dated 10.03.2021 passed by the Income Tax Appellate Tribunal, "C" Bench, Bengaluru (for short, ‘Appellate Authority’) in IT(TP)A.No.2866/Bang/2017 for the assessment year 2013-14. 3. This Court, admitted the appeal on 19.08.2024 to consider the following substantial questions of law: "1. Whether the Tribunal was right in law to ignore the parameters of analysis prescribed under Rule 10b, which are exhaustive and if so, whether it is legally permissible to bypass the same partially or by implication? 2. Whether on the facts and circumstances of the case and in law, the Tribunal is right in law in excluding comparable’s such CG VAk Software & Exports Pvt Ltd., Persistenant Systems Ltd, Larsen & Tourbo Ltd and inclusion of comparable namely, R Systems International Ltd by ignoring the parameters of analysis prescribed under Rule 10B, which are exhaustive and, if so, whether it is legally permissible to bypass the same partially or by implication?” 4. Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct Taxes. It is also submitted that the aforesaid Circular binds the revenue. 5. On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under the aforesaid Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024. - 5 - 6. In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned counsel for the revenue. However, the question of law is kept open to be adjudicated in an appropriate proceeding. Sd/- (S.G.PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE SMJ List No.: 2 Sl No.: 11