2016 (2) TMI 511

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....d as a 100% export oriented unit by the Central Government under the existing scheme. During the relevant previous year, one of the group concerns namely Gebbs Technology Ltd. (GPL) which was engaged in BPO and I.T. related services was demerged w.e.f 1st April 2007, by the order of the Hon'ble High Court and its business got transferred to the assessee with all assets and liabilities as a going concern. For the assessment year under consideration, assessee filed its return of income claiming deduction of an amount of Rs. 6,24,65,464 under section 10B of the Act in respect of profit earned from its SEEPZ unit. In the course of assessment proceedings, the Assessing Officer found that assessee's claim of deduction under section 10B of the Act in the assessment year 2008-09 was rejected by the Assessing Officer in the order passed under section 143(3) of the Act for the reason that assessee had not employed its own manpower and goods but got its work done on job .  work basis. The Assessing Officer also noted that unit is made out of re-structuring of old unit as held in the earlier assessment year. When this fact was pointed out by the Assessing Officer to the assessee, the ....

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....pheld the decision of the learned Commissioner (Appeals) by .  dismissing the appeal by the Department in respect of all these assessment years. In the latest order passed for assessment year 2008-09 in ITA no.6700/Mum./2011, dated 3rd April 2013, the Tribunal, following its own order for the preceding assessment year, has held as under:-   "4. After considering the order of AO and CIT(A) and submission of ld. DR, we found that issues squarely covered by the decision of the Tribunal for earlier 3 years i.e. for A.Y. 2003-04 to A.Y. 2005-06. For these 3 years also the deduction was disallowed by the AO claimed u/s 10B. However, CIT(A) allowed the issue in favour of assesee. On appeal by the department before Tribunal the order of ld. CIT(A) were confirmed by the Tribunal while passing order in ITA Nos. 3370, 7738, 7196/Mum/2007-08 vide order dated 13.10.10. Therefore, we see no reason to interfere in the finding of ld. CIT(A) which are in consonance with the order of Tribunal for earlier 3 years i.e. from A.Y. 2003-04 to A.Y. 2005-06. Even the AO has mentioned in his order that in earlier year the deduction was denied by the AO and ld. CIT(A) has allowed the issue....

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..../s ACIT, [2012] 151 TTJ 588 (Mum.) held that income / profit relating to SEEPZ unit has to be excluded while computing book profit under section 115JB.   10. We have considered the submissions of the parties and perused the material available on record. Learned Representatives of both the parties agreed that the issue in dispute is squarely covered by the decision of the Tribunal, Mumbai Bench, in Genesys International Corporation Ltd. (supra). On a careful reading of the aforesaid decision of the co-ordinate bench of the Tribunal, it is found that the Tribunal, while deciding identical nature of dispute, has held as under:-   "20. We have considered submissions of ld representatives of parties and orders of authorities below. We have also carefully considered the relevant provisions of the Act. There is no dispute to the fact that assessee's unit in Mumbai is located in SEZ. Section 10A provides deduction of profits derived by the undertaking in respect of units which are located not only in SEZ but also in the following areas: "*Free Trade Zone (FTZ) * Electronic Hardware Technology Park (EHTP) * Software Technology Par (STP) ....

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....s of section 115JB will not apply to the income accrued or arisen on or after 1.4.2005 from any business carried on in an unit located in SEZ. Hence, we are of the considered view that the unit in SEZ will be covered by sub-section(6) to section 115JB of the Act irrespective of the fact that those units were claiming deduction u/s.10A of the Act. We also observe that benefit given to SEZ unit from the applicability of provisions of section 115JB has been withdrawn by the Finance Act, 2011 by inserting a proviso to section 115JB(6) of the Act, which reads as under: "Section 15JB(6)........... . Provided that the provisions of this sub-section shall cease to have effect in respect of an previous year relevant to the assessment year commencing on or after the 1st day of April, 2012." .... ...... 22. Hence, we hold that authorities below were not justified to include the book profit in respect of SEZ unit at Mumbai of the assessee while computing book profit u/s.115JB of the Act for assessment year 2008-09. Therefore, we reverse the orders of authorities below by holding that income relating to SEZ unit at Mumbai is to be excluded while computing boo....

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....ner (Appeals).   13. The first appellate authority, after considering the submissions of the assessee, found that the assessee is not a shareholder of GTL. Further, the amount of Rs. 4,93,765, cannot be considered to be in the nature of loan or advance as it is pursuant to transfer entry passed by the order of the Hon'ble Jurisdictional High Court consequent to demerger of BPO division of GTL. The learned Commissioner (Appeals), therefore, relying upon the decision of the Tribunal, Mumbai Special Bench, in ACIT v/s Bhaumik Colour Pvt. Ltd., [2009] 27 SOT 270 (Mum.)(SB) and the decision of the Tribunal, Indore Bench, in ACIT v/s Writers & Publishers, ITA no.518/Ind./2010, deleted the addition by holding that the amount of Rs. 4,93,765, cannot be treated as deemed dividend under section 2(22)(e).   14. We have considered the submissions of the parties and perused the material available on record. As could be seen, the undisputed facts are, the assessee is not a registered shareholder of GTL. The only reason for which the Assessing Officer has treated the amount of Rs. 4,93,765, as deemed dividend is both the companies have some common shareholders. That, in our vi....