1 IN HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS 2ND DAY OF SEPTEMBER 2020 PRESENT HON BLE MR. JUSTICE ALOK ARADHE AND HON BLE MR. JUSTICE H.T.NARENDRA PRASAD I.T.A. NO.83 OF 2013 C/W I.T.A. NO.82 OF 2013 I.T.A. NO.83 OF 2013 BETWEEN: 1. COMMISSIONER OF INCOME TAX BANGALORE-III, BANGALORE. 2. DY. COMMISSIONER OF INCOME TAX CIRCLE 12(4), BANGALORE. ... APPELLANTS (BY SRI. E.I. SANMATHI, ADV.,) AND: M/S. SYMPHONY SERVICES CORPORATION (I) PRIVATE LIMITED No.13/1, KADUBEESANAHALLI VILLAGE OUTER RING ROAD, VARTHUR HOBLI BANGALORE-560103. ... RESPONDENT (BY SRI. ANKUR PAI, FOR SRI. K.R. VASUDEVAA, ADV.,) --- 2 THIS I.T.A. IS FILED UNDER SECTION 260-A OF I.T.ACT, 1961, ARISING OUT OF ORDER DATED 28-09-2012 PASSED IN ITA NO.1207/BANG/2012, FOR ASSESSMENT YEAR 2005-06, PRAYING TO: I. FORMULATE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN. II. ALLOW APPEAL AND SET ASIDE ORDER OF ITAT, BANGALORE PASSED IN ITA NO.1207/BANG/2012 DATED 28-09-2012 AND ORDER OF COMMISSIONER OF INCOME TAX, (APPEALS)-IV, BANGALORE DATED 30-09- 2011 IN APPEAL NO.8/RANGE-12/CIT(A)-IV/2008-09. I.T.A. NO.82 OF 2013 BETWEEN: 1. COMMISSIONER OF INCOME TAX BANGALORE-III, BANGALORE. 2. DY. COMMISSIONER OF INCOME TAX CIRCLE 12(4), BANGALORE. ... APPELLANTS (BY SRI. E.I. SANMATHI, ADV.,) AND: M/S. SYMPHONY SERVICES CORPORATION (I) PRIVATE LIMITED No.13/1, KADUBEESANAHALLI VILLAGE OUTER RING ROAD, VARTHUR HOBLI BANGALORE-560103. ... RESPONDENT (BY SRI. ANKUR PAI, FOR SRI. K.R. VASUDEVAA, ADV.,) --- THIS I.T.A. IS FILED UNDER SECTION 260-A OF I.T.ACT, 1961, ARISING OUT OF ORDER DATED 28-09-2012 PASSED IN ITA NO.1187/BANG/2012, FOR ASSESSMENT YEAR 2005-06, PRAYING TO: 3 I. FORMULATE SUBSTANTIAL QUESTIONS OF LAW STATED THEREIN. II. ALLOW APPEAL AND SET ASIDE ORDER OF ITAT, BANGALORE PASSED IN ITA NO.1187/BANG/2012 DATED 28-09-2012 AND ORDER OF COMMISSIONER OF INCOME TAX, (APPEALS)-IV, BANGALORE DATED 30-09- 2011 IN APPEAL NO.8/RANGE-12/CIT(A)-IV/2008-09. THESE I.T.As. COMING ON FOR HEARING, THIS DAY, ALOK ARADHE J., DELIVERED FOLLOWING: JUDGMENT Mr.E.I.Sanmathi, learned counsel for revenue. Mr.Ankur Pai, learned counsel for respondent. 2. These appeals under Section 260-A of Income Tax Act, 1961 (hereinafter referred to as Act , for short) have been preferred by revenue which were admitted by Bench of this Court vide order dated 07.10.2013 and 10.06.2013, respectively to consider following substantial questions of law: (i) Whether on facts and in circumstances of case, Tribunal was justified in law in directing assessing authority not to set off carry forward business losses of STPI unit and current year loss of non STPI unit of Rs.1,94,02,355/- against 4 profits of business before allowing deduction under Section 10A of Income tax Act? (ii) Whether on facts and in circumstances of case, Tribunal was justified in law in holding that reimbursement of expenditure of Rs.2,31,06,882/- towards telecommunication expenses and Rs.3,30,61,328/- towards foreign travel expenses incurred in foreign currency are to be excluded from total turnover as well as for computation of deduction under Section 10A whereas such exclusion is permitted to arrive at export turnover only as per definitions given in section 10A of IT Act and total turnover has not been defined in section? (iii) Whether Tribunal is correct in law in holding that deduction under Section 10A should be computed in above manner following judgment of jurisdictional High Court in case of CIT Vs. Tata Elxsi Ltd. and CIT Vs. Yokogawa India Ltd. which have not become final since same have not been accepted by Department and SLPs are pending before Hon ble Supreme Court? 5 3. When appeals were taken up today, learned counsel for parties jointly submitted that substantial question of law No.1 in both appeals is covered by decision of this Court in YOKOGAWA INDIA LTD. Vs. CIT AND ORS. aforesaid decision has been affirmed by Supreme Court in CIT AND ORS. Vs. YOKOGAWA INDIA LTD. (2017) 391 ITR 274 (SC). It is further submitted that second substantial question of law in both appeals is also covered by decision of this Court rendered in COMMISSIONER OF INCOME-TAX Vs. TATA ELXI LTD. (2012) 349 ITR 98 (KAR) and aforesaid view has been affirmed by Supreme Court in COMMISSIONER OF INCOME-TAX, CENTRAL-III Vs. HCL TECHNOLOGIES LTD. (2018) 93 TAXMANN.COM 33 (SC). 6 4. In view of aforesaid submissions and in view of enunciation of law by Supreme Court, substantial questions of law framed in these appeals are answered against revenue and in favour of assessee. In result, appeals fail and are hereby dismissed. Sd/- JUDGE Sd/- JUDGE RV Commissioner of Income-tax Bangalore-III, Bangalore / Dy. Commissioner of Income-tax Circle 12(4), Bangalore v. Symphony Services Corporation (I) Private Limited