Visakhapatnam) In I.t.a v. The Appeal Is Accordingly Dismissed. No Order As To Costs

THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTA AND THE HON’BLE Ms. JUSTICE G. ROHINI INCOME TAX APPELLATE TRIBUNAL APPEAL NO.119 OF 2013 DATED:27.6.2013 Between: Commissioner of Income Tax –III IT TowersA.C. GuardsHyderabad … Appellant And M/s. Seven Hills Business Solutions LimitedQ1A1, 10[th] Floor, Cyber TowersHitec CityMadhapurHyderabad … Respondent THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTA AND THE HON’BLE Ms. JUSTICE G. ROHINI I.T.T.A. NO.119 OF 2013 JUDGMENT:(per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta) We have heard the learned counsel for the appellant and gonethrough the impugned judgment and order. The appeal is sought to be admitted on the following suggestedquestions of law. i. In the facts and circumstances of the case, whether theHon’ble Tribunal (ITAT) is correct in law in upholding theorders of Commissioner of Income Tax (Appeals) to considerthe amounts disallowed for adopting the income eligible fordeduction under Section 10A of the Act without consideringthe language used under Section 10(a)(1) of the Act, moreparticularly the word “derived from” which has restrictivemeaning and not “attributable to” which has a widerconnotation? ii. In the facts and circumstances of the case, whether theHon’ble Tribunal is justified in law in holding that there cannotbe any disallowance for the rent amount paid by theRespondent – assessee on account of non-deduction of TDSin terms of Section 40(a)(ia) of the Act, when the Respondent– assessee failed to comply with the statutory obligation ofdeduction of TDS and such amounts are liable to bedisallowed ? iii. In the facts and circumstances of the case, whether theHon’ble Tribunal is correct in law in holding that the amountsdisallowed by the Assessing Officer are to be considered asbusiness income for the purpose of computation of deductionunder Section 10A of the Act?” It appears, the learned Tribunal has not only relied on thedecision rendered in the case of Merilyn Shipping & Transports (Visakhapatnam) in I.T.A. No.477/Viz/2008, but also on the decision ofBombay High Court in the case of C.I.T. v. Gem Plus Jewellery (India)Ltd., and held that the assessee is entitled to exemption under Section10A of the Income Tax Act with reference to addition of disallowanceunder Section 43B, as the consequence of the disallowance and addback made by the Assessing Officer is an increase in the businessprofit of the assessee. Therefore, we do not find any reason tointerfere with the impugned judgment and order. The appeal is accordingly dismissed. No order as to costs. ________________________ K.J. SENGUPTA, CJ ______________________ G. ROHINI, J 27.6.2013 bnr