TaxTMI 
TaxTMI 
2017 (3) TMI 77
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.... established in AY 96-97 into STPI unit, 1.3 That on the facts and circumstances of the case, the learned CIT (A) ought to have held that a new unit was established in FY 1999-2000, 2. Whether on the facts and circumstances of the case and in law the CIT(A) erred in law in holding that the appellant had violated the conditions prescribed in sub-section (9) of section 10A of the Act and was therefore, not eligible for claiming deduction under section 10A? 2.1 That for the purposes of section 10A(9 ) read with explanation 1 the comparison of shareholding ought to have been done as at 31.03.2000 and 31.03.2003 2.2 Without prejudice to the above grounds whether transfer in shareholding made before 01.04.2000 can be reckoned for purposes of ascertaining change in beneficial shareholding for purposes of section 10A(9 ) read with explanation 1. 3. That in any case the Section 10A is an incentive provision and should be construed liberally. 4. That on the facts and in the circumstances of the case the Learned CIT(A) was not justified in upholding the disallowance in respect of employer & employee contribution to PF & ESI amounting to Rs. 548462/- and Rs. 16731/- respectively." ....
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....ersy qua AY 2002-03 also held that the assessee is not eligible for deduction u/s 10A of the Act being hit by provisions contained u/s 10A of the Act. 6. The ld. AR for the assessee contended that provisions contained u/s 10A(a) of the Act are not applicable to the assessee as the same has been omitted from AY 2004-05 meaning thereby the said sub-section never existed in the statute book and relied upon the decision rendered y Hon'ble Karnataka High Court in CIT vs. G.E. Thermometrics India Pvt. Ltd. in ITA 876/2008 dated 25.11.2014. 7. The ld. AR for the assessee by relying upon Circular No.1 of 2005 dated 06.01.2005 issued by CBDT saying the assessee to be eligible for deduction claimed u/s 10A of the Act. 8. The assessee for the sake of brevity also given chronology of events to prove its eligibility for claiming deduction u/s 10A of the Act which is extracted as under :- Sr.No. Date Particulars 1. 06.07.1995 Assessee company incorporated and started domestic unit engaged in local sale of various computer software. 2. F.Y. 1999-00 Assessee company started export unit for rendering software development services and for that purpose undertook v....
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.....f. 01.04.2004, it should be understood that the said section never existed in the statute book and therefore the benefit claimed by the assessee u/s 10B should be allowed?" 5. The learned Counsel for the revenue assailing the impugned order contends that it is well settled that the Income Tax Act as it stands amended on the first day of April of any financial year must apply to the assessment of that year. Any amendments in the Act which come into force after first day of April of a financial year would not apply to the assessment for that year, even if the assessment is actually made after the amendments come into force. In support of his contention, he relies on the judgment of the Apex Court in the case of KARIMTHARUVI TEA ESTATE LTD., VS. STATE OF KERALA reported in [1966] 060 ITR 0262. On the same analogy, though sub-section (9) of Section 10B was omitted with effect from 01.04.2004, on the day the beneficial interest was transferred and for subsequent period, till the said omission took place, the said omitted provision is applicable and he submits that the approach of the Tribunal is erroneous and requires to be set aside. 6. Per contra, the learned Counsel for the asse....
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.... such omission is to extend the benefit under Section 10B of the Act irrespective of the fact whether during the period to which they are entitled to the benefit, the ownership continues with the original assessee or it is transferred to another person. Benefit is to the undertaking and not to the person who is running the business. We do not see any merit in these appeals. The substantial question of law is answered in favour of the assessee and against the revenue. Accordingly, the appeals are dismissed." 12. The ratio of the judgment in case of CIT vs. GE Thermometrics India Pvt. Ltd. (supra) is that once any provision is omitted from the statute book, the result is that it had never been passed and be considered as a law that never exists and as such, the assessee is entitled for benefit of section 10A of the Act and section 10A(9) is not attracted in its case. 13. By following the law laid down by Hon'ble Karnataka High Court in case of CIT vs. GE Thermometrics India Pvt. Ltd. (supra), the coordinate Bench of the Tribunal in ITA No.6386 & 6387/Del/2012 in assessee's own case extended the relief u/s 10A of the Act to the assessee in AY 2005-06. Since the year under assessmen....