Ita/334/2019 Of Pr Commissioner Of Income Tax -7 v. M/S Toshiba Software India Pvt Ltd

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 21 DAY OF OCTOBER, 2024 PRESENT THE HON'BLE MR JUSTICE V KAMESWAR RAO AND THE HON'BLE MR JUSTICE S RACHAIAH INCOME TAX APPEAL NO.334 OF 2019 BETWEEN: 1. PR. COMMISSIONER OF INCOME TAX -7 BMTC COMPLEX KORMANGALA BENGALURU. 2. THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE 12(4) BENGALURU. …APPELLANTS (BY SRI. SANMATHI E.I., ADVOCATE) AND: Digitallysigned byNARAYANAM/S. TOSHIBA SOFTWARE INDIA PVT. LTD. UMANO.3A, ‘ESSAE VAISHNAVI SOLITAIRE’ Location:3RD BLOCK, KORAMANGALA HIGH COURTBENGALURU-560 034. OFKARNATAKA …RESPONDENT (BY SRI. ANKUR P.D., ADVOCATE) THIS ITA FILED UNDER SECTION 260-A OF THE INCOME TAX ACT 1961, PRAYING TO SET ASIDE THE APPELLATE ORDER DATED 11.01.2019 PASSED BY THE INCOME TAX APPELLATE TRIBUNAL, 'A' BENCH, BANGALORE, AS SOUGHT FOR, IN THE RESPONDENT ASSESSEE'S CASE, IN APPEAL PROCEEDINGS IN IT(TP)A NO.268/BANG/2014 FOR THE ASSESSMENT YEAR 2009-2010 (ANNEXURE-A). THIS APPEAL, COMING ON FOR FINAL HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE V KAMESWAR RAO and HON'BLE MR JUSTICE S RACHAIAH ORAL JUDGMENT (PER: HON'BLE MR JUSTICE V KAMESWAR RAO) The challenge in this appeal is to an order dated 11.01.2019 passed by the Income Tax Appellate Tribunal, “A” Bench, Bangalore in two cross appeals i.e., IT(TP)A No.268/Bang/2014 2009-10 and IT(TP)A No.198/Bang/2014 2009-10 filed by the parties vide Annexue-A. 2. The appellant-revenue has raised the following substantial questions of law: 1.Whether on the facts and circumstances of the case, the Tribunal is right in law in excluding the comparables, namely, M/s. Bodhtree Consulting Limited, Infosys Technologies Ltd. Persistent Systems Ltd and Tata Elxi Limited by following its earlier order passed in the case of M/s. TE Connectivity Global Shared Services Pvt Ltd which has not reached finality even though the said companies are functionally similar to that of the assessee ignoring FAR analysis and materials brought on record by the Transfer Pricing Officer? 2.Whether on the facts and circumstances of the case, the order of the Tribunal can be held as perverse in nature since the Tribunal has erred in ignoring the annual reports, audited accounts and TP study of Transfer Pricing Officer relating to the excluded companies? case, the order of the Tribunal can be held as perverse in nature since the Tribunal has erred in ignoring the annual reports, audited accounts and TP study of Transfer Pricing Officer relating to the excluded companies? 3. The appeal has been admitted on 16.12.2020. The learned counsel appearing for the respondent states that though the appeal has been admitted, the net tax effect is less than two cores. It is also his submission that the appeal does not fall in the exception carved out in terms of the instructions issued by the revenue and as such, this appeal needs to be dismissed. The appeal has been admitted on 16.12.2020. 4. The learned counsel Mr. E.I., Sanmathi, agreeing with the submission that the tax effect is less than two crores, states liberty be granted to the appellant to seek revival of the appeal, if the issue which arises for consideration falls within the exception carved out in the instructions issued by the revenue. 5. In view of the submission made by the learned counsel for the respondent and also by Mr. E.I., Sanmathi, the appeal is disposed of reserving liberty as sought for by the learned counsel for the revenue. However, the questions of law are kept open to be adjudicated in appropriate proceedings. Sd/- (V KAMESWAR RAO) JUDGE Sd/- (S RACHAIAH) JUDGE JS List No.: 1 Sl No.: 40