Ita/229/2013 Of Commissioner Of Income Tax v. M/S Medi Assist (India) Tpa Pvt. Ltd

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 27 DAY OF OCTOBER 272020PRESENT THE HON’BLE MR. JUSTICE ALOK ARADHE AND| THE HON’BLE MR. JUSTICE H.T.NARENDRA PRASADLT.A. NO.229 OF 2013 BETWEEN: 1.|COMMISSIONER OF INCOME TAX) CENTRAL REVENUE BUILDINGS QUEENS ROAD, BANGALORE-560001.. 2.|THE ASSISTANT COMMISSIONER OF INCOME TAX)CIRCLE 12(1), BANGALORE.CIRCLE 12(1), BANGALORE. .., APPELLANTS~ (BY Mr. E.I. SANMATHI, ADV.,) AND* M/S. MEDI ASSIST (INDIA) TPA PVT. LTD‘SHILPA VIDYA, NO.49,1ST MAIN ROADSARAKKI INDUSTRIAL LAYOUT3RD PHASE, J.P. NAGAR|BANGALORE-5600 /8.a. RESPONDENT| (BY Mrs. VANI H, ADV.) THIS ITA IS FILED UNDER SECTION 260-A OF I.T. ACT,|1961 ARISING OUT OF ORDER DATED 11.01.2013 PASSED IN ITA.NO.667/BANG/2011 FOR THE ASSESSMENT YEAR 2007-08,PRAYING THAT THIS HON’ BLE COURT MAY BE PLEASED TO:(1) FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW.STATED THEREIN.» (II) SET ASIDE THE APPELLATE ORDER DATED 11-01-2013)PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, B BENCH,BANGALORE,IN|APPEAL|PROCEEDINGSNO.I.T.A.NO.667/BANG/2011. THIS|ITACOMING|ONFOR.HEARING,|THISALOK ARADHE J.,DELIVERED THE FOLLOWING: | DAY, | JUDGMENT This appeal under Section 260A of the Income TaxAct, 1961 (hereinafter referred to as the Act for short)nas been preferred by the revenue. The subject matterof the appeal pertains to the Assessment year200/7-0The appeal was admitted by a bench of this Court videorder dated 13.08.2013 on the following substantialquestion of law: (i) Whether on the facts and in thecircumstances of the case, the Tribunal Is correct in holding that the assessee Isentitled to disclose revenue from certainactivitiesspreadOVertheperiodofinsurance policies for Income Tax purpose|rather than recognizing the entire amount|in the year in which the invoices in respect|of fee was raised on insurance companies? (ii) Whether on the facts and in thecircumstances of the case, the Tribunal Is correct in holding that the assessee IS allowed to change the method of accounting in the assessment year under reference inrespect of TPA fee without appreciating thefact that as per AS-11 notified by the|Central Government under section 145(2)|of I.T. Act, change in accounting policy Is.allowed only if such change !Is required bythe statute or if it is considered that thechange would result in more appropriate|preparation of financial statements and|such conditions are absent In the Instant|Case ? (iii) Whether on the facts and in thecircumstances of the case, the Tribunal Is correct in holding that the activities of the|assessee company are not of an insurance|company/business without appreciating thefact that Hon’ble Hign Court in the case of|Same assessee has held that the assessee'’sbusiness activities fall under the activities of|insurance company? (iv) Whether on the facts and in thecircumstances of the case, the Tribunal Is correct in coming to conclusion tnat the|assessee is entitled to follow accountingStandard 9 for revenue recognition’ inrespect of TPA fee received from insurance|companles? (v) Whether on the facts and in thecircumstances of the case, the Tribunal Is correct in placing reliance on the decision ofApex Court in the case of CIT V/s. BilhariInvestments P. Ltd reported in 299 ITR|page 1 without appreciating the fact that.the order of Apex Court Is distinguishable|and not applicable to the facts of the case|of the assessee as no ratio has been laiddown by the Apex Court, which can be used|for the purpose of upholding the method ofaccounting adopted by the assessee in the|assessment year under consideration? 2.|For the reasons assigned by us in tnejudgment passed today in I.T.A.No.593/2013, the!substantial questions of law framed by a bench of this. %������������$�������������������&������������#�&�����#��������������������������!� �$���������#���������������������������! ����������#��!��������������������������� ����������� ��� �����������