Rp/455/2012 Of Ivl India (P) Ltd v. The Commissioner Of Income Tax

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR.JUSTICE M.L.JOSEPH FRANCIS THURSDAY, THE 27TH DAY OF SEPTEMBER 2012/5TH ASWINA 1934 RP.No. 455 of 2012 () IN ITA/10/2010 ------------------------------------- AGAINST THE ORDER/JUDGMENT IN ITA.10/2010 DATED 05/01/2011 REVIEW PETITIONER(S):/ APPELLANT-------------------- IVL INDIA (P) LIMITED, TECHNO PARK, THIRUVANANTHAPURAM BY ADVS.SRI.E.K.NANDAKUMAR (SR.) SRI.A.K.JAYASANKAR NAMBIAR SRI.K.JOHN MATHAI SRI.P.BENNY THOMAS SRI.P.GOPINATH RESPONDENT(S):/ RESPONDENT -------------- THE COMMISSIONER OF INCOME TAX, THIRUVANANTHAPURAM. BY SHRI.P.K.R. MENON, SR.STANDING COUNSEL, INCOME TAX DEPT. THIS REVIEW PETITION HAVING COME UP FOR ADMISSION ON 27-09-2012, THECOURT ON THE SAME DAY PASSED THE FOLLOWING: C.N.RAMACHANDRAN NAIR, &M.L.JOSEPH FRANCIS, JJ. .................................................................... R.P. No.455 of 2012 inI.T.A. No.10 of 2010 .................................................................... Dated this the 27[th] day of September, 2012. ORDER Ramachandran Nair, J. Review Petition is filed by the assessee contending that factual mistakes are there in the order of the Tribunal and the same continuedeven in the judgment of this court because this court followedTribunal's findings on facts. We have heard Senior counselSri.Jayasankar Nambiar for the review petitioner and also StandingCounsel for the respondent. 2. Question raised is computation of profit on export of computer software under Section 80HHE of the Income Tax Act which providesfor computation of deduction of profit on export of software in thesame way export profit is computed under Section 80 HHC of the Act.The specific grievance raised in the R.P. is that 90% of the consultancycharges received in convertible foreign exchange is excluded byapplying Explanation (d) to Section 80HHE(3) of the Act which is similar to Explanation (baa) to Section 80HHC of the Act. Whilecounsel for the review petitioner submitted that consultancy is part ofthe export business and the receipts referred to are received fromforeign clients in convertible foreign exchange, Standing Counselsubmitted that disallowance may be on receipts received in Indianrupee from consultancy rendered locally. This is certainly a factualissue which calls for verification by the Assessing Officer. If theassessee' case is correct, then 90% of the receipts cannot be included inthe computation of export profit eligible for deduction. On the otherhand, if the consultancy charges received are in Indian rupee for servicerendered in India, exclusion is certainly called for. We dispose of theR.P. directing the Assessing Officer to verify the factual position andapply the law as stated above. C.N.RAMACHANDRAN NAIRJudge M.L.JOSEPH FRANCISJudge