2020 (9) TMI 972

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....ertains to the Assessment year 2009-10, whereas, the subject matter of I.T.A.No.12/2016 pertains to Assessment Year 2010-11. 2. In both the appeals, the following common substantial questions of law. Arise for consideration: (i) Whether on the facts and in the circumstances of the case, the Income Tax Appellate Tribunal was justified in holding that the assessee was entitled to the benefit of deduction under Section 10A of the Income Tax Act, 1961 for the Assessment Year in question? (ii) Whether the services of the assessee were limited to drafting of patent application and their submission to the US patent office and as such the assessee was not entitled to claim deduction under Section 10A of the Income Tax Act, 1961? 3. Since, com....

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.....02.2015 respectively held that respondent is entitled for deduction under Section 10A of the Act in the light of notification issued by CBDT, which is applicable to the case of the assessee as the services rendered by the assessee can broadly be classified as office operations, data processing, legal databases and same can be termed as information technology enabled services. Being aggrieved, the revenue filed appeals before the Income Tax Appellate Tribunal (hereinafter referred to as 'the Tribunal' for short). The tribunal in respect of Assessment Years 2009-10 and 2010-11 vide orders dated 03.01.2014 and 07.08.2015 inter alia held that activities of the assessee can be categorized as back office operations, data processing, lega....

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.... order to claim the benefit of deduction under Section 10A of the Act, all conditions have to be satisfied. It is also submitted that if there is any ambiguity in the exemption notification, the same should be interpreted strictly and in favour of the revenue. In support of his submissions, learned counsel for the revenue has placed reliance on decisions in 'M/S L.R.BROTHERS INDO FLORA LIMITED VS. COMMISSIONER OF CENTRAL EXCISE', CIVIL APPEAL NO.7157/2008 DATED 01.09.2020, 'RAMNATH & CO. VS. COMMISSIONER OF INCOMETAX', (2020) 116 TAXMANN.COM 885 (SC), 'COMMISSIONER OF INCOME TAX VS. REGENCY CREATIONS LTD.', (2012) 27 TAXMANN.COM 322 (DELHI), and 'COMMISSIONER OF CUSTOMS (IMPORT), MUMBAI VS. DILIP KUMAR & COMPANY', (2018) 69 GST 239 (SC). 7....

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.... has been held to be 'processing of goods' by division bench of this court in 'COMMISSIONER OF INCOME TAX VS. Datacons (P) LTD.', (1985) 155 ITR 66 (KAR). It is also submitted that the issues involved in these appeals are in fact questions of fact and findings of fact are concurrent in nature and therefore, no interference is called for. In support of aforesaid submissions, reliance has been placed on 'KULWANT KAUR VS. GURDIAL SINGH MANN', (2001) 4 SCC 262, 'VIJAY KUMAR TALWAR VS. CIT', 330 ITR 1 (SC), 'K.RAINDRANATHAN NAIR VS. CIT', 247 ITR 178 (SC), 'SUDHARSHAN SILKS AND SAREES VS. CIT', 300 ITR 205 (SC), 'CBDT NOTIFICATION NO.890(E) DATED 26.09.2000, 'CIT VS. M.L.OUTSOURCING SERVICES PVT LTD', 271 CTR 553 (DEL), 'CIT VS. MS/KIRAN KAPOOR'....

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....ct. The aforesaid Notification is clarificatory in nature and has been issued to clarify the expression viz., 'computer software' used in Explanation 2(i)(b) of Section 10A of the Act. The aforesaid Notification specifies that information and technology enabled products or services mentioned in the Notification shall be treated as Information Technology enabled products or services for the purposes of Explanation 2(i)(b) of Section 10A of the Act, which includes Back Office Operations and Data processing as well. 10. The assessee receives back office work from the legal department of software companies in USA. The companies assign back office work of registering their technology in USA patent office. The applications are prepared, finalize....