Global E Business Operations Private Limited, Bangalore v. CIT, Bangalore

ITA 276/BANG/2011 | 2005-2006
Pronouncement Date: 31-07-2012 | Result: Allowed

Appeal Details

RSA Number 27621114 RSA 2011
Assessee PAN AACCC2943F
Bench Bangalore
Appeal Number ITA 276/BANG/2011
Duration Of Justice 1 year(s) 4 month(s) 15 day(s)
Appellant Global E Business Operations Private Limited, Bangalore
Respondent CIT, Bangalore
Appeal Type Income Tax Appeal
Pronouncement Date 31-07-2012
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted B
Tribunal Order Date 31-07-2012
Date Of Final Hearing 25-07-2012
Next Hearing Date 25-07-2012
Assessment Year 2005-2006
Appeal Filed On 15-03-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBNAL BANGALORE BENCH B BANGALORE BEFORE SHRI N.BARATHVAJA SANKAR VICE PRESIDENT AND SHRI N.V.VASUDEVAN JUDICIAL MEMBER ITA NO.276(B)/2011 (ASSESSMENT YEAR : 2005-06) M/S GLOBAL E BUSINESS OPERATIONS PVT.LTD. THE C IT THE ICON 2 ND FLOOR BA NGALORE 4 TH FLOOR NO.8 80 FT. ROAD HAL 3 RD STAGE INDRANAGAR BANGALORE PAN NO.AACCC2943F VS APPELLANT RESPONDEN T ASSESSEEE BY : SHRI SRIRAM SESHADRI CA REVENUE BY : SHRI FARHAT HUSSAIN QURESHI CIT-II DATE OF HEARING : 25-07-2012 DATE OF PRONOUNCEMENT : 31-07-2012 O R D E R PER SHRI N.V.VASUDEVAN JM: THIS IS AN APPEAL BY THE ASSESSEE AGAINST THE ORDE R DATED 30- 12-2010 OF CIT BANGALORE RELATING TO AY: 2005-06. 2. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINES S OF DEVELOPING SOFTWARE. FOR ASSESSMENT YEAR 2005-06 THE ASSESSE E FILED ITS RETURN OF INCOME DECLARING A LOSS OF RS.2 07 88 373/-. THE ASSESEEE WAS ITA NO.276(B)/2011 2 ENTITLED TO CLAIM DEDUCTION U/S 10A OF THE IT ACT 1961. THE ELIGIBLE DEDUCTION U/S 10A OF THE ACT IS COMPUTED AS FOLLOWS ; EXPORT TURNOVER X ELIGIBLE BUSINESS PROFITS TOTAL TURNOVER EXPORT TURNOVER HAS BEEN DEFINED UNDER CLAUSE(IV) EXPLANATION-2 TO SEC.10A OF THE ACT IS AS FOLLOWS; EXPORT TURNOVER MEANS THE CONSIDERATION IN RESPEC T OF EXPORT BY THE UNDERTAKING OF ARTICLES O THINGS OR C OMPUTER SOFTWARE RECEIVED IN OR BROUGHT INTO INDIA BY THE ASSESSEE IN CONVERTIBLE FOREIGN EXCHANGE IN ACCORDANCE WITH SUB- SECTION(3) BUT DOES NOT INCLUDE. (I) FREIGHT TELECOMMUNICATION CHARGES OR INSURANCE ATTRIBUTABLE TO THE DELIVERY OF THE ARTICLES OR THI NGS OR COMPUTER SOFTWARE OUTSIDE INDIA OR (II) EXPENSES IF ANY INCURRED IN FOREIGN EXCHANGE IN PROVIDING THE TECHNICAL SERVICES OUTSIDE INDIA.. 3. IN THE COURSE OF ASSESSMENT PROCEEDINGS THE AO CALLED UPON THE ASSESSEE BY LETTER DATED 08-10-2008 TO GIVE ADJUSTM ENT TOWARDS FREIGHT TELECOM INSURANCE TECHNICAL SERVICES WH ILE COMPUTING THE DEDUCTION U/S 10A OF THE IT ACT. THE ASSESSEE FURNI SHED THE FOLLOWING DETAILS. COMPUTATION OF DEDUCTION U/S 10A OF THE IT ACT 19 61 (THE ACT) ADJUSTMENTS TOWARDS FREIGHT/TELECOM/INSURANCE/TECHNICAL SERVICES AS PER PROFIT & LOSS ACCOUNT AND SCHEDULE K TO FINA NCIAL OF GLOBAL-E-FOR THE YEAR ENDED MARCH 31 2005 THE FOLL OWING EXPENDITURE HAS BEEN INCURRED; ITA NO.276(B)/2011 3 PARTICULARS AMOUNT AS P ER SCHEDULE K (EXPEND.) PROFIT & LOSS A/C INCURRED IN FO REIGN EXCHANGE COMMUNICATION EXPENSES 109 825.384 1 442.242 TRAVEL & CONVEYANCE 268.881.615 1 34.317.387 LEGAL AND PROFESSIONAL CHARGES 40 364.985 2 040.482 4. IN THE COURSE OF ASSESSMENT PROCEEDINGS IT WAS NOTICED THAT THE ASSESSEE REDUCED THE COMMUNICATION EXPENSES TO THE TUNE OF RS.14 42 242/- FROM THE EXPORT TURNOVER AS WELL AS TOTAL TURNOVER WHILE COMPUTING THE ELIGIBLE DEDUCTION U/S 10A OF T HE IT ACT 1961. THE AO HELD THAT COMMUNICATION EXPENSES HAVE TO BE REDUCED FROM THE EXPORT TURNOVER AND CANNOT BE REDUCED FROM THE TOTAL TURNOVER AS DONE BY THE ASSESSEE. THE DEDUCTION U/S 10A OF T HE IT ACT WAS ACCORDINGLY REWORKED BY THE AO. 5. THE CIT IN EXERCISE OF POWERS U/S 263 OF THE AC T WAS OF THE VIEW THAT THE AFORESAID ORDER OF THE AO PASSED U/S 143(3 ) OF THE ACT ON 31-012-2008 WAS ERRONEOUS AND PREJUDICIAL TO THE IN TEREST OF REVENUE. IN THIS REGARD THE CIT WAS OF THE VIEW T HAT THE ASSESSEE HAD INCURRED A SUM OF RS.13 43 17 367/- IN FOREIGN CURRENCY TOWARDS TRAVELING AND CONVEYANCE AND IN TERMS OF CL AUSE (IV) OF EXPLANATION-2 TO SEC.10A OF THE ACT ANY EXPENDITUR E INCURRED IN FOREIGN EXCHANGE IN PROVIDING TECHNICAL SERVICES OU TSIDE INDIA HAS TO BE EXCLUDED FROM THE EXPORT TURNOVER. SINCE THE A FORESAID EXPENSES WERE INCURRED IN CONNECTION WITH FOREIGN TRAVEL EXP ENSES (WHICH ACCORDING TO CIT WERE FOR PROVIDING TECHNICAL SERVI CES) WERE NOT REDUCED FROM THE EXPORT TURNOVER WHILE COMPUTING DE DUCTION U/S ITA NO.276(B)/2011 4 10A OF THE ACT THE ORDER OF AO WAS ERRONEOUS AND P REJUDICIAL TO THE INTEREST OF REVENUE. 6. IN REPLY TO THE SHOW CAUSE NOTICED ISSUED BY TH E CIT THE ASSESSEE SUBMITTED THAT ENQUIRIES WERE MADE BY THE AO ON THE ISSUE OF WHAT IS EXPORT TURNOVER AND THE ASSESSEE H AD MADE APPROPRIATE SUBMISSIONS AND THE AO AFTER HAVING CO NSIDERED THE SUBMISSIONS MADE AND THE OBJECTIONS RAISED BY HE AS SESSEE HAD DECIDED NOT TO MAKE ANY ADJUSTMENT ON ACCOUNT OF TH E EXPENSES INCURRED IN FOREIGN CURRENCY IT WAS A CASE OF THE AO HAVING TAKEN A PLAUSIBLE VIEW ON THE MATTER. IT WAS FURTHER SUBMI TTED THAT THE RELEVANT CLAUSE OF THE EXPLANATION REQUIRING THE EX PENSES INCURRED IN FOREIGN CURRENCY TO BE REDUCED FROM THE EXPORT T URNOVER IS APPLICABLE ONLY IF THE ASSESSEE IS ENGAGED IN THE B USINESS OF RENDERING TECHNICAL SERVICES OUTSIDE INDIA. IT WAS SUBMITTED THAT THE ASSESSEE WAS ENGAGED IN THE BUSINESS OF PROVIDI NG DATA PROCESSING SERVICES AND OTHER IT ENABLED SERVICE FO R HEWLETT PACKARD COMPANIES WORLD WIDE WHICH IS DISTINCT AND MUST BE DISTINGUISHED FROM THE BUSINESS OF RENDERING TECHNICAL SERVICES OUTSIDE INDIA. IT WAS SUBMITTED THAT THIS VIEW HAS BEEN UPHELD BY THE ITAT BANGALORE BENCH IN THE CASE OF INFOSYS TECHNOLOGIES LTD. VS DCIT REPORTED IN 109 TTJ 631. RELYING ON THE ABOVE DEC ISION IT WAS SUBMITTED THAT AS THE ASSESSEE WAS NOT ENGAGED IN T HE BUSINESS OF RENDERING TECHNICAL SERVICES OUTSIDE INDIA. THE FO REIGN TRAVEL EXPENSES INCURRED IN FOREIGN CURRENCY ARE NOT REQUI RED TO BE EXCLUDED FROM THE EXPORT TURNOVER FOR THE PURPOSE O F COMPUTING THE DEDUCTION ALLOWABLE U/S 10A. IT WAS STATED THAT TH E ASSESSEE WAS IN ITA NO.276(B)/2011 5 FACT ENGAGED IN CARRYING OUT CALL CENTRE ACTIVITIES AND BACK OFFICE OPERATIONS AND THE SAME DOES NOT AMOUNT TO RENDERIN G TECHNICAL SERVICES OUTSIDE INDIA. IT WAS FURTHER SUBMITTED T HAT COMPUTER SOFTWARE HAS BEEN DEFINED IN EXPLANATION 2(I) OF S EC.10A AND AS PER THE CBDTS NOTIFICATION NO.SO 890(E) DATED 26.09.20 00 CERTAIN IT ENABLED SERVICES HAVE ALSO BEEN NOTIFIED AS COMING WITHIN THE MEANING OF COMPUTER SOFTWARE FOR THE PURPOSE OF S EC.10A AND RENDERING OF TECHNICAL SERVICES OUTSIDE INDIA PER SE IS DIFFERENT AND DISTINCT FROM COMPUTER SOFTWARE AS PER THE ABOVE DEFINITION. IT WAS FURTHER SUBMITTED THAT IN CASE THE AFORESAID SUM IS TO BE EXCLUDED FROM THE EXPORT TURNOVER THEN THE SAME SHOULD ALSO BE EXCLUDED FROM THE TOTAL TURNOVER AND IN THIS REGARD THE ASS ESSEE RELIED ON THE FOLLOWING DECISIONS CIT VS GEM PLUS JEWELLERY IND IA LTD. REPORTED IN 233 CTR 248(MUM.) AND ITO VS SAK SOFT LTD. REP ORTED IN 313 ITR(ITAT) 353(AT) CHENNAI SPL.BENCH) IT WAS ALSO SUBMITTED THAT THE DEFINITION OF EXPORT TURNOVER AND TOTAL TURNOVE R HAVE TO BE READ AND INTERPRETED HARMONIOUSLY AS THE INCENTIVE IS RE QUIRED TO BE COMPUTED ON A PROPORTIONATE BASIS IN THE RATIO OF E XPORT TURNOVER TOTAL TURNOVER. IN SUPPORT OF ITS CONTENTIONS THE ASSESSEE HAS RELIED ON A NUMBER OF ITAT DECISIONS INCLUDING THE DECISIO N IN THE CASE OF KSHEMA TECHNOLOGIES (LTD. (2008 TIOL-440-ITAT-BANG ). RELYING ON THE DECISION IN THE CASE OF TATA ELXSI LTD. IN ITA NO.315/BANG/2006 DATED 16-10-2007(ITAT BANGALORE B ENCH) IT HAS BEEN CONTENDED THAT AS THE TOTAL TURNOVER IS TH E SUM OF THE EXPORT TURNOVER AND DOMESTIC TURNOVER. IF THE CONCE RNED CHARGES DO NOT FORM PART OF THE EXPORT TURNOVER AS PER THE DEF INITION THEN THERE IS NO SCOPE TO INCLUDE SUCH CHARGES IN THE TOTAL TU RNOVER. ITA NO.276(B)/2011 6 7. THE CIT HOWEVER WAS OF THE VIEW THAT THE AO DI D NOT MAKE ANY ENQUIRIES ON THE ASPECTS SET OUT IN THE SHOW CAUSE NOTICE U/S 263 OF THE IT ACT 1961. THE CIT WAS ALSO OF THE VIEW THA T CLAUSE (IV) OF EXPLANATION-2 TO SEC.10A ALSO ENVISAGES A SITUATION WHERE EVEN A SOFTWARE DEVELOPER CAN RENDER TECHNICAL SERVICES OU TSIDE INDIA. THE CIT THEREAFTER PROCEEDED TO HOLD THAT THERE WAS NO N-APPLICATION OF MIND BY THE AO ON THIS ASPECT AND THEREFORE THE OR DER OF AO WAS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF REVENU E. THE CIT ALSO HELD THAT WHAT IS EXCLUDED FROM THE EXPORT TURNOVER NEED NOT BE EXCLUDED FROM THE TOTAL TURNOVER AS CONTENDED BY TH E ASSESSEE. THE CIT FINALLY SET ASIDE THE ORDER OF THE AO FOR FRES H CONSIDERATION BY THE AO ON THE ASPECTS DISCUSSED BY THE CIT IN HIS O RDER U/S 263 OF THE IT ACT 1961. THE FOLLOWING WERE THE RELEVANT OBSERVATION MADE BY THE CIT. IN VIEW OF THE ABOVE IT IS NECESSARY FOR THE AO TO EXAMINE IN DETAIL AND ASCERTAIN THE NATURE OF THE EXPENSES OF RS.13 43 17 367/- INCURRED IN FOREIGN CURRENCY FOR FOREIGN TRAVEL AFTER VERIFYING THE SUBMISSIONS MADE BY THE ASSESSEE AS MENTIONED ABOVE WITH REFERENCE TO THE FACTS OF THE ASSESSEES CASE AND THE RELEVANT PROVISIONS OF CLAUSE(IV) OF EXPLNATION-2 TO SEC.10A FOR THE PURPO SE OF COMPUTING THE DEDUCTION ALLOWABLE U/S10A. THE ASSESSMENT ORDER WHICH HAS BEEN HELD TO BE ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE RE VENUE FOR THE REASONS STATED ABOVE IS THEREFORE SET ASIDE A QND THE AO IS DIRECTED TO MAKE A FRESH ASSESSMENT IN THE LI GHT OF MY OBSERVATION ABOVE AFTER GIVING THE ASSESSEE A REASONABLE OPPORTUNITY OF BEING HEARD. ITA NO.276(B)/2011 7 8. AGGRIEVED BY THE ORDER OF THE CIT THE ASSESSEE PREFERRED THE PRESENT APPEAL BEFORE THE TRIBUNAL. 9. WE HAVE HEARD THE SUBMISSIONS OF THE LEARNED CO UNSEL FOR THE ASSESSEE WHO SUBMITTED THAT AS ON THE DATE WHEN THE CIT PASSED THE ORDER U/S 263 OF THE ACT NAMELY 30-12-2010 THER E WERE DECISIONS RENDERED BY VARIOUS BENCHES OF THE TRIBUN AL TAKING A VIEW THAT UNDER CLAUSE-(IV) OF EXPLANATION-2 TO SEC.10A OF THE ACT EXPENDITURE INCURRED IN FOREIGN CURRENCY IN PROVIDI NG TECHNICAL SERVICES OUTSIDE INDIA WILL NOT COVER THE CASE OF A N ASSESSEE ENGAGED IN THE BUSINESS OF PROVIDING SOFTWARE DEVELOPMENT S ERVICES. THE FOLLOWING DECISIONS WERE REFERRED TO IN THIS REGARD . NAME OF THE CASE CITATION DATE OF ORDER SAK SOFT LTD 313 ITR 353(CHEN.(SB)(ITAT) MARCH 6 20 09 BINARY SEMANTICS LTD 109 TTJ 556(DEL.)(HC) MARCH 30 2007 SRA SYSTEMS LTD 305 ITR 27(CHE.)(ITAT) JUNE 15 2007 TATA ELXSI LTD (115 TTJ 423) BANG.ITAT) OCTOBER 16 2007 PATNI TELECOM(P)LTD 308 ITR 414(HYD.ITAT) JANUARY 1 1 2008 SOFTSOL INDIA LTD 22 SOT 271(HYD.ITAT) FEBRUARY 15 2008 GEM PLUS JEWELLERY 330 ITR 175(BOM.)(HC) JUNE 23 2 010 GE MEDICAL SYSTEMS (I) PVT.LTD./ 2009 TIOL 669(BANG ITAT) AUGUST 4 2009 I GATE GLOBAL SOLUTIONS LTD 112 TTJ 1002(BANG ITAT) DECEMBER 18 2009 INTEL TECHNOLOGY PVT.LTD 2009 TIOL 752(BANG ITAT) SEPTEMBER 25 2010 ITA NO.276(B)/2011 8 IT WAS FURTHER SUBMITTED THAT IN THE LIGHT OF THE A FORESAID JUDICIAL DECISIONS THE CLAIM OF THE ASSESSEE CANNOT BE SET T O BE ERRONEOUS. IN THIS REGARD IT WAS ALSO POINTED OUT THAT THE AO IN THE COURSE OF ASSESSMENT PROCEEDINGS DID APPLY HIS MIND TO THE QU ANTUM OF EXPORT TURNOVER TO BE CONSIDERED FOR DEDUCTION U/S 10A OF THE ACT. IT CANNOT BE SAID THAT THE AO DID NOT MAKE ENQUIRIE S WHICH HE OUGHT TO HAVE MADE. FURTHER THE VIEW TAKEN BY TH E AO IS A POSSIBLE VIEW AND WHERE TWO VIEWS ARE POSSIBLE THE CIT CANNOT EXERCISE HIS POWERS U/S 263 JUST BECAUSE HE DOES N OT AGREE WITH THE VIEW TAKEN BY THE AO. IT WAS SUBMITTED THAT T HE JURISDICTION U/S 263 CANNOT BE EXERCISED FOR SUBSTITUTING THE VI EW OF THE CIT WITH THAT OF THE AO. IT WAS ALSO SUBMITTED THAT EV EN ASSUMING THAT THE AFORESAID SUM INCURRED IN FOREIGN EXCHANGE FOR TRAVEL ABROAD IS TO BE EXCLUDED FROM THE TOTAL TURNOVER THAN THE SU M HAS TO BE EXCLUDED FROM THE TOTAL TURNOVER ALSO AND IN THIS R EGARD THE ATTENTION WAS DRAWN TO THE DECISION OF THE HONBLE KARNATAKA HIGH COURT IN THE CASE OF M/S TATA ELXSI LTD. (2012) 20-4 TAXMAN 321(KAR.) APPROVING THE AFORESAID VIEW. FINALLY IT WAS SUBMITTED THAT THE ACTION OF THE CIT CANNOT BE SUSTAINED BECA USE IN ANY EVENT IT CANNOT BE SAID THAT THERE WAS ANY PREJUDICE TO T HE INTEREST OF REVENUE AND THE WHOLE EXERCISE IS REVENUE NEURAL EX ERCISE. 10. THE LEARNED DR SUBMITTED THAT THE VIEW TAKEN B Y THE AO EVEN IF IT IS IN CONSONANCE WITH THE VIEW EXPRESSED BY THE TRIBUNAL IN SEVERAL DECIDED CASES THE SAME CANNOT BE A BAR FOR THE CIT TO EXERCISE JURISDICTION U/S 263 OF THE ACT BECAUSE IN PRINCIPLE THE REVENUE HAS NOT ACCEPTED THE THEORY OF PARITY OF TH E FIGURES OF EXPORT ITA NO.276(B)/2011 9 TURNOVER AND TOTAL TURNOVER WHILE COMPUTING THE DED UCTION U/S 10A OF THE ACT. IN THIS REGARD OUR ATTENTION WAS DRAW N TO THE DECISION OF THE DELHI BENCH OF THE TRIBUNAL IN THE CASE OF HIND USTAN TIN WORKS LTD VS DCIT92 ITD 101(DEL) WHEREIN IT WAS HELD THAT IF THE VIEW TAKEN BY AN AO EVEN IF IT IS IN CONFORMITY WITH THE DECISION THAT THE JURISDICTIONAL OR OTHER HIGH COURTS IF THE JURISDI CTION OF THE HIGH COURT IS A SUBJECT MATTER OF APPEAL BEFORE THE SUPR EME COURT THEN THE JURISDICTION U/S 263 CAN BE INVOKED. TO A QUERY AS TO WHETHER ANY SPECIFIC APPEAL HAS BEEN FILED AGAINST THE VARI OUS ORDERS CITED BY THE LEARNED COUNSEL FOR THE ASSESSEE BEFORE THE HIG HER FORUMS THE LEARNED DR COULD NOT GIVE THE REQUIRED PARTICULARS BUT HOWEVER SUBMITTED THAT EXERCISING JURISDICTION U/S 263 WAS PROPER. 11. THE LEARNED COUNSEL FOR THE ASSESSEE IN HIS RE JOINDER SUBMITTED THAT THE HONBLE SUPREME COURT IN THE CASE OF CIT VS MAX INDIA 295 ITR 282(SC) HAS TAKEN A VIEW THAT IF TWO VIEWS ARE POSSIBLE ON AN ISSUE AND THE AO HAS TAKEN ONE VIEW AND BY REASO NS OF SUBSEQUENT RETROSPECTIVE AMENDMENT TO THE LAW SUCH VIEW BECOMES ERRONEOUS EVEN THAN JURISDICTION U/S 263 CANNOT BE EXERCISED. 12. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IN OUR VIEW THE ORDER U/S 263 CANNOT BE SUSTAINED. FIRSTLY WE FIN D THAT IN THE COURSE OF ASSESSMENT PROCEEDINGS THE ASSESSEE HAS FURNISHED DETAILS REGARDING COMMUNICATION EXPENSES TRAVEL AN CONVEYANCE EXPENSES LEGAL AND PROFESSIONAL CHARGES IN THE CON TEXT OF DEDUCTION U/S 10A OF THE ACT. IN THE ORDER OF ASSESSMENT T HE AO HAS DISCUSSED ONLY ONE ASPECT OF THE CLAIM FOR DEDUCTIO N U/S 10A OF THE ITA NO.276(B)/2011 10 ACT NAMELY REDUCING COMMUNICATION EXPENSES BOTH FR OM THE EXPORT TURNOVER AND THE TOTAL TURNOVER. THE ORDER OF THE AO IS SILENT WITH REGARD TO THE EXPENSES INCURRED IN FOREIGN EXCHANGE NAMELY TRAVELING EXPENSES. THE CIT IN HIS ORDER U/S 263 HAS PROCEEDED TO HOLD THAT THE ORDER OF THE AO IS ERRONEOUS NOT BECA USE OF LACK OF ENQUIRY BY THE AO BUT ON THE GROUND THAT THE FOREI GN TRAVEL EXPENSES INCURRED IN FOREIGN EXCHANGE WERE IN CONNE CTION WITH PROVIDING TECHNICAL SERVICES OUTSIDE INDIA. THE CI T PASSED THE ORDER U/S 263 ON 30-12-2008. AS ON THIS DATE THERE WERE S EVERAL DECISIONS RENDERED BY THE TRIBUNAL IN WHICH A VIEW HAS BEEN E XPRESSED THAT THE EXPENSES INCURRED IN FOREIGN CURRENCY NEED NOT BE REDUCED FROM THE EXPORT TURNOVER IN THE CASE OF AN ASSESSEE WHO IS ENGAGED IN THE BUSINESS OF DEVELOPMENT OF SOFTWARE. IN OTHER WORDS SUCH ADJUSTMENT CAN BE MADE ONLY IF THE ASSESSEE WHO IS ENGAGED IN THE BUSINESS OF PROVIDING TECHNICAL SERVICES OUTSIDE IN DIA. IN THE LIGHT OF THE AFORESAID JUDICIAL PRONOUNCEMENT THE VIEW T AKEN BY THE AO WAS A POSSIBLE VIEW. THE LEARNED DR COULD NOT POI NT OUT AS TO WHY THERE ARE CONTRARY VIEWS EXPRESSED ON THE ABOVE IS SUE BY ANY HIGHER FORUM TO THAT OF THE ITAT. NOR WAS THE DR WA S ABLE TO SUBSTANTIATE THE AFORESAID PRONOUNCEMENTS WERE SUBJ ECT MATER OF APPEAL PENDING BEFORE THE HIGHER JUDICIAL FORUMS. IN THE ABOVE CIRCUMSTANCES WE ARE OF THE VIEW THAT THE DECISION S OF THE ITAT DELHI BENCHES IN THE CASE OF HINDUSTAN TIN WORKS LT D. (SUPRA) WILL NOT BE APPLICABLE TO THE FACTS OF THE PRESENT CASE. IN THE LIGHT OF THE ABOVE SAID JUDICIAL PRONOUNCEMENT CITED BY THE COUN SEL FOR THE ASSESSEE WE ARE OF THE VIEW THAT THE AO HAS TAKEN A POSSIBLE VIEW AND THE CIT CANNOT IN EXERCISE OF POWERS U/S 263 SE EK TO SUBSTITUTE ITA NO.276(B)/2011 11 HIS VIEW WITH THAT OF THE AO. ON THIS BASIS WE HOL D THAT THE ORDER U/S 263 CANNOT BE SUSTAINED AND THE SAME IS QUASHED . 13. IN VIEW OF THE ABOVE CONCLUSION THE OTHER SUB MISSIONS MADE BY THE PARTIES BEFORE US DO NOT REQUIRE ANY CONSIDERAT ION. 14. IN THE RESULT THE APPEAL FILED BY THE ASSESSE E IS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE 31 ST JULY 2012. SD/- SD/- (N.BARATHVAJA SANKAR) ( N.V.VASUDEVAN) VICE PRESIDENT JUDI CIAL MEMBER BANGALORE: D A T E D : 31-07-2012 AM* COPY TO : 1 APPELLANT 2 RESPONDENT 3 CIT(A)-IV BANGALORE. 4 CIT 5 DR ITAT BANGALORE. 6 GUARD FILE (1+1) BY ORDER SENIOR PRIVATE SECRETARY ITAT BANGALORE