AI Drafter 
TaxTMI 
TaxTMI 
2019 (3) TMI 400
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....comprises of running a call centre, income from which has been claimed as exempt u/s 10B of the Act. The assessee was registered under the Software Technology Park (STP in short) scheme as 100% Export Oriented Unit (EOU in short) on 28.1.2005. The same was subsequently renewed on 27.7.2010. The green card was issued to the assessee by the designated officer for Secretary to the Government of India, Department of Information Technology and Chairman Inter Ministerial Standing Committee on Software Technology Park Scheme. The assessee does not have any approval from the Board of Approval for EOU Scheme. The claim of deduction u/s 10B of the Act was disallowed by the ld AO. 4. The entire debate and argument of the A.O. who has disallowed the benefit u/s 10B and the assessee who has argued his case for eligibility of exemption of its income u/s 10B revolves around certain provisions of Sec. 10B which is clearly mentioned in CBDT Instruction No. 2/2009 dated 09.03.2009 as rectified by Instruction of even number on 08.05.2009. The following is extract of instruction: "Section 10B of the Income Tax Act provides for exemption of income in case of hundred per cent export oriented....
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....rned STPI should be construed as approval of Board of Approval as well. The second argument offered by the assessee gives simplistic interpretation that few constituents of the Board constitute the entire Board. 7. The revenue pointed out that the above cited Instruciton of the Board dated 8.5.2009 was much more subsequent to the year 1999, the delegation of which has been made the basis of the opinion of the Deputy Director, STPI has been considered by the Board., as it mentions - "Subsequent to the delegation of this power by the Ministry of Commerce and Industries" Accordingly, the ld AO observed that it could be concluded that in order to avail the exemption of income u/s 10B of the Act, the assessee must fulfill the two conditions mentioned above i.e. it should be approved by Deputy Director STPI and subsequent to the same, the approval must be ratified by the Board of Approval. As no such approval has been obtained by the assessee in the instant case, the exemption sought by them u/s 10B of the Act is to be denied. This action of the ld AO was upheld by the ld CITA. Aggrieved, the assessee is in appeal before us. 8. We have heard the rival submissions. We fi....
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....d the February 16th 2006 SOFTWARE TECHNOLOGY PARK(STP) UNIT HAS BEEN APPROVED UNDER THE STP SCHEME OF THE GOVT. OF INDIA AS A 100% EXPORT ORIENTED UNIT FOR COMPUTER SOFTWARE. THIS UNIT IS ENTITLED TO TOP PRIORITY TREATMENT FROM ALL CONCERNED CENTRAL AND STATE GOVERNMENT DEPARTMENTS AND OTHER ORGANISATIONS IN ALL MATTERS RELATING TO THE PROJECT TAXPUNDIT.ORG Sd/- DESIGNATED OFFICER FOR SECRETARY TO THE GOVT OF INDIA DEPARTMENT OF INFORMATION TECHNOLOGY AND CHAIRMAN, INTERMINISTERIAL STANDING COMMITTEE ON SOFTWARE TECHNOLOGY PARK SCHEME." 11.1 The above green card approval has to be understood in its true and fullest sense in the larger interest and purpose behind setting up a unit and the allied benefits it is likely to bring. These export benefits would automatically be eligible for deduction u/s. 10B of the Act. Otherwise, the purpose of granting the same for setting up a unit and registering with STP as 100% EOU status would get defeated. 12. We also find lot of force in the alternative argument made by the ld.AR that the assessee company being registered with STP is entitled for claiming deductio....
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.... regarding registration for setting up STP unit ( 100% Export Oriented Unit under STP scheme). The same is reproduced here in below for the sake of convenience:- "Software Technology Parks of India Ministry of Communication & Information Technology, Dept of IT, Govt. of India Plot No.5/1 DP Sector-V, Salt Lake, Kolkata-700 091 Ph: 91-33-2367- 3598/99-2367 3798/99, Fax 91-33- 2367-3597 Email:[email protected]/URLhttp://www.kol.stp.in To The Director Wizard Enterprises Pvt. Ltd. 5, Lake Avenue, Kolkata - 700026 SUB: YOUR STP UNIT APPROVAL RATIFICATION REG. REF: Your letter dt: 29.08.2011 Sir, With reference to above and discussions with your officials, the facts w.r.t, your STP unit registration is produced below: 1. Your unit 'Wizard Enterprises Pvt. Ltd.' is registered as a 100% Export Oriented Unit under STP scheme vide LOP no. STPK:DIR:441:2005-06:1548 dt: 10.01.2006 as per notification no. 33/(RE)(92-97 dt: 22.03.1994 read with subsequent amendments and EXIM Policy ( Foreign Trade Policy. 2. As per Para 6.26 of Foreign Trade Policy 2004-2009: 'In the case of units under EHTP /STP Schemes,....
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....o the same. The Ld. counsel for the assessee drew our attention to the gazetted notification in this regard placed at page 16 of the paper book-II under which the powers had been given to consider the application for setting up of units under STP Scheme operated vide custom notification No. 138 and 140 dated 22.10.1991. The said committee was also empowered to consider the proposals for industrial license, foreign technical collaboration, agreement and import of .capital goods. The assessee has furnished the Registration under the Software Technology Park Scheme of India vide approval No. STPIM/PCMG/PSE/02/199-7492 dated 17.2.2003 registering the assessee as an 100% EOU. The copy of the said certificate is enclosed at pages 105 to 109 of the paper book alongwith the copy of the agreement entered into by the assessee company with STPI on 17.2.2003, a copy of which is enclosed at pages 111 to 113 of the paper book. In view of the above said evidence, upholding the order of CIT(A), we hold that the assessee is entitled to deduction u/s 10B of the Act as a 100% EOU on being registered with STPI. In the entirety of facts and circumstances of the case and in view of our observation in pa....
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....the AO ought to have guided the assessee with regard to eligibility to claim deduction under section 10A of the Act." 18. We also find that the contents of audit report in form no. 56F and 56G together with the computation mechanism remains the same for claiming the deduction u/s. 10A/10B of the Act. It was argued alternatively by the ld.AR that the decision of the ld.AO is to educate the assessee of its rights and entitlements as per law and cannot take advantage of ignorance of assessee. In this regard, he cited the relevant extract of the decision of the Hon'ble Bombay High Court in the case of Sanchi Software & Solutions Pvt. Ltd Vs. CIT reported in (2012) 349 ITR 404 (Bom), wherein it was held as under:- "Income-tax Department cannot take advantage of the assessee's mistakes in not claiming the exemption in the Income-tax Return and not deny him exemption. The entire object of administration of tax is to secure the revenue for the development of the country and not to charge the assessee more tax than that which is due and payable by the assessee." 19. We find that the decision of the Hon'ble Jurisdictional High Court in the case of CIT Vs. India Cap....
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....the Court on 05.09.2018 ============= Document 1 Whether applies Section 10A/ Relevant sub- Whether applies to Section 10B Relevant sub- section, proviso or section, proviso explanation or explanation Sl.No. Proposition 1. Benefit of deduction for export of articles/ computer software 2. Benefit is available for a period of 10 consecutive A.Ys. beginning with the year in which undertaking begins to produce/manufacture such article/ computer software 3. Definition of "computer software" is Any product or service of the similar nature as may be notified by CBDT. CBDT vide Notification No.SO 890(E) dated 26.09.2000 has notified the list of Information Technology enabled products or services eligible for benefit of exemption "Call Centre" activity figuring at item (ii) of the said list 4. Benefits under the provisions are Not available w.e.f 01.04.2012 Yes Yes Sub-section(1) Sub-section(1) Yes Sub-section(1) Yes exempted as per CBDT Notification Explanation (2) below Section10A Yes 4th Proviso to Yes Sub-section(1) Yes exempted as as per CBDT Notif....