Of Income Tax And Another v. Yokogawaindia Ltd. And Othersin Ita

IN THB HIGH COURT OF KARNATAKA AT BANGALORE DATEKD THIS THE O08 DAY OF JULY 2014 PRESENT THR HON BLE MR.JUSTICE N.KUMAR| AN D THR HON'BLBE MR..JUSTICBK B.MANOHA ITA No.444 /2008 BBRHIWEE 1. The Commissioner of Income Tax,C.R Building, Queens Road,Bangalore.2. The Income Tax Officer,Ward -12(2),C.R. Building,|Queens Road,Bangalore... Appellant(By Sri.K.V.Aravind, Advocate)AN):M/s.Tektronix Engineering Dev.India Pvt Ltd.,Tek Towers, Hayes Road,Bangalore — 530 025..... Responden(By Smt.Vani.H, Advocate) This ITA is filed U/s.260-A of I.T Act, 1961 arisingOUToT|orderdated|26/10/2007passedinITA.No.208/Bang/2006, for the Assessment year 2002-O3, praying that this Hon’ble Court may be pleased to: 1. formulate the substantial questions of lawstated therein.stated therein. 11. allow the appeal and set aside the order|passedby theITATBangalore|1nITA.No.208/2006, dated 26-10-2007 confirmthe order of the Appellate Commissioner>and confirm the order passed by the IncomeTax Officer, Ward — 12(2), Bangalore, in theinterest of justice and equity.passedby theITATBangalore|1nITA.No.208/2006, dated 26-10-2007 confirmthe order of the Appellate Commissioner>and confirm the order passed by the IncomeTax Officer, Ward — 12(2), Bangalore, in theinterest of justice and equity. This appeal coming on tor Hearing this day,N.Kumar J.,delivered the following: JUDGMENT This appeal is filed by the Revenue under Section260A of the Income Tax Act, 1961 (for short ‘the Act’)challenging the order dated 26/10/2007 passed by the Income Tax Appellate Tribunal, Bangalore Bench ‘B’(hereinafter referred to as ‘the Tribunal’ for short) whereby the Tribunal has granted the relief to theassessee on two counts. OoThe substantial questions of law that arise for ourconsideration are as follows: 1. Whether the Appellate Authoritieswere correct in holding that the loss from non-STP units is not required to be set off againstthe income of the other profit making SIP|units before allowing deduction u/s.10A of|the Act without taking into consideration that|the same should be completed on the total|income as per the provision and the amended|section 10A(4) of the Act?| 2. Whether the Appellate Authoritieswere correct in holding that a sum_ ofRs. 14,03,18,500/- should be treated as alosswhencomputingthe|BookProfitu/S.115JB of the Act despite the same being|contingent liability and the value of the|Shares was not disclosed and the order of|this Hon’ble Court dated 23.10.2002 was§passed after the end of the Year? 3.|Insofar as the first substantial question of law is concerned, this Court in the case ofOMMVMTS OF INCOME TAX AND ANOTHER v/s YOKOGAWAINDIA LTD. AND OTHERSin ITA No.356/2010 and_ other connected appeals, after reviewing the entire caselaw held the issue in favour of the assessee and againstthe Revenue. Applying the same yardstick in this casealso, the first substantial question of law in this appealis answered in favour of the assessee and against theRevenue. However, it is submitted that the judgment ofthis court in the aforesaid case is the subject matter ofthe appeal before the Apex Court. In the event of ApexCourt answering the said issue in favour of theRevenue, then the Assessing Authority shall give effectto the order in terms of the order passed by the Hon’bleSupreme Court under Section 260(1A) of the Act. 4The second substantial question of law is also thesubject matter of the judgment of this Court in the caseoT|COMMISSIONER OF INCOME-TAX AND ANOTHERv/s WEIZMANN HOMES LTD.,wherein the Apex Courtaiter considering the entire case law and taking note ofthe subsequent amendment has held the said question in favour of the Revenue and against the assessee. — Accordingly, this isSue is answered in favour of theRevenue and against the assessee. 5 In view of the above, we pass the following order: The appeal is partly allowed as stated above. od/- JUDGE od/-|JUDGE. _* | mp