ADDL CIT RG 15(1), MUMBAI v. PARWEB SOLUTIONS, MUMBAI

ITA 3403/MUM/2010 | 2007-2008
Pronouncement Date: 15-07-2011 | Result: Dismissed

Appeal Details

RSA Number 340319914 RSA 2010
Assessee PAN AAGFP7776A
Bench Mumbai
Appeal Number ITA 3403/MUM/2010
Duration Of Justice 1 year(s) 2 month(s) 15 day(s)
Appellant ADDL CIT RG 15(1), MUMBAI
Respondent PARWEB SOLUTIONS, MUMBAI
Appeal Type Income Tax Appeal
Pronouncement Date 15-07-2011
Appeal Filed By Department
Order Result Dismissed
Bench Allotted C
Tribunal Order Date 15-07-2011
Date Of Final Hearing 28-06-2011
Next Hearing Date 28-06-2011
Assessment Year 2007-2008
Appeal Filed On 30-04-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES C MUMBAI BEFORE SHRI R V EASWAR PRESIDENT AND SHRI B RAMAKOTAIAH ACCOUNTANT MEMBER I T A NO: 3403/MUM/2010 (ASSESSMENT YEAR: 2007-08) INCOME TAX OFFICER 15(1)(4) MUMBAI APPELLANT VS M/S PAR WEB SOLUTIONS MUMBAI RESPONDENT (PAN: AAGFP7776A) ASSESSEE BY: MR FARROKH IRANI REVENUE BY: MR SANJIV DUTT O R D E R R V EASWAR PRESIDENT: THIS IS AN APPEAL BY THE INCOME TAX DEPARTMENT AND IT PERTAINS TO THE ASSESSMENT YEAR 2007-08. THE FOLLO WING GROUNDS HAVE BEEN TAKEN: - 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. COMMISSIONER OF THE INCOME TAX (APPEALS) ERRED IN HOLDING THAT THE ASSESSEE IS ELIGIBLE FOR EXEMPTION U/S. 10A OF THE INCOME-TAX ACT 1961 AND THEREBY ALLOWING THE CLAIM OF EXEMPTION U/S. 10A AMOUNTING TO RS.8 45 47 524/- IGNORING THE FACT THAT THE ASSESSEE HAS NOT FULFILLED THE PRIMARY CONDITIONS AS REQUIRED U/S. 10A OF THE INCOME-TAX ACT IN RESPECT OF ASSESSEES UNDERTAKING NOT BEING LOCATED IN A SOFTWARE TECHNOLOGY PARK. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) HAS ERRED IN HOLDING THAT REGISTRATION STP UNIT BY THE ASSESSEE ITSELF IS SUFFICIENT FOR ELIGIBILITY OF DEDUCTION 10A OF THE INCOME- TAX ACT WITHOUT ANY MANDATE OF LAW. 2. THE RESPONDENT-ASSESSEE IS A PARTNERSHIP FIRM EN GAGED IN THE BUSINESS OF COMPUTER SOFTWARE AND INFORMATION T ECHNOLOGY ITA NO: 3403/MUM/2010 2 ENABLED WEBSITE SERVICES. THE APPEAL ARISES OUT OF THE ASSESSMENT ORDER PASSED ON 21.12.2009 UNDER SECTION 143(3) OF THE INCOME TAX ACT 1961. 3. THE BRIEF FACTS GIVING RISE TO THE APPEAL MAY BE REFERRED TO. IN THE RETURN OF INCOME THE ASSESSEE CLAIMED EXEMPT ION UNDER SECTION 10A OF THE ACT. THIS SECTION MAKES SPECIAL PROVISION IN RESPECT OF NEWLY ESTABLISHED UNDERTAKINGS IN FREE T RADE ZONE ETC. ACCORDING TO SUB-SECTION (1) A DEDUCTION OF PROFIT S AND GAINS DERIVED BY AN UNDERTAKING FROM THE EXPORT OF ARTICL ES OR THINGS OR COMPUTER SOFTWARE IS GIVEN FOR A PERIOD OF TEN CONS ECUTIVE ASSESSMENT YEARS BEGINNING WITH THE YEAR IN WHICH T HE UNDERTAKING BEGINS TO MANUFACTURE THE COMPUTER SOFTWARE OR ARTI CLES OR THINGS AS THE CASE MAY BE. WHILE EXAMINING THE CLAIM THE ASSESSING OFFICER NOTED THAT IN THE ASSESSMENT YEARS 2005-06 AND 2006-07 THE ASSESSEE HAD BEEN GRANTED THE EXEMPTION. HE HO WEVER PROCEEDED TO EXAMINE THE CLAIM FOR THE YEAR UNDER A PPEAL AFRESH ON THE FOOTING THAT THERE IS NO ESTOPPEL IN SUCH MATTE RS AND IT WAS HIS DUTY TO ASCERTAIN WHETHER THE CLAIM WAS CORRECTLY M ADE. HE ALSO OBSERVED THAT IN SUCH MATTERS HE IS NOT BOUND TO FO LLOW THE EARLIER ORDERS. ON THIS BASIS HE CALLED UPON THE ASSESSEE TO JUSTIFY THE CLAIM AND WOULD APPEAR TO HAVE ISSUED A QUESTIONNAI RE TO THE ASSESSEE. THE ASSESSEE MADE WRITTEN SUBMISSIONS BY LETTER DATED 10.07.2009 IN WHICH THE JUSTIFICATION FOR CLAIMING THE EXEMPTION WAS GIVEN. THE GIST OF THE SAME HAS BEEN REPRODUCED IN PARAGRAPH 5 OF THE ASSESSMENT ORDER AND THEREFORE IT IS NOT REPROD UCED HERE FOR THE SAKE OF BREVITY. ITA NO: 3403/MUM/2010 3 4. AFTER NOTICING THE ASSESSEES WRITTEN SUBMISSION S THE ASSESSING OFFICER ISSUED ANOTHER LETTER DATED 28.08 .2009 IN WHICH HE OBSERVED THAT THE BUSINESS ADDRESS OF THE ASSESS EE FIRM WAS SHOWN TO BE IN MAHIM WHEREAS THE ADDRESS OF THE SOF TWARE UNIT WAS SHOWN TO BE AT HIND SERVICE INDUSTRIAL PREMISES CO- OPERATIVE SOCIETY LIMITED AT SHIVAJI PARK DADAR. HE WAS OF THE VIEW THAT THE ASSESSEE MERELY GOT REGISTRATION OF THE UNIT AS STP (SOFTWARE TECHNOLOGY PARK) UNIT BUT THE UNIT WAS NOT ACTUALLY SET UP IN THE STP. NEITHER MAHIM NOR DADAR WAS A NOTIFIED AREA F OR STP. IN THIS CONNECTION THE ASSESSING OFFICER ALSO REFERRED TO T HE ASSESSEES STATEMENT THAT ITS UNIT IS STPI (SOFTWARE TECHNOLOG Y PARKS OF INDIA) REGISTERED UNIT AS PER THE CERTIFICATE ISSUED BY TH E STPI AND THAT THE CUSTOM BONDING FOR THE ASSESSEES PLACE OF BUSINESS WAS ALSO OBTAINED FROM THE COMMISSIONER OF CUSTOMS. HE STAT ED THAT IT WAS NOT CLEAR FROM THE RECORD AS TO WHETHER THE CUSTOM BONDING WAS IN RESPECT OF THE PREMISES AT MAHIM OR DADAR. THE ASS ESSEE WAS ASKED TO CLARIFY THESE ASPECTS AND ALSO TO FURNISH A COPY OF THE CHANGE OF LOCATION OF BUSINESS AS CERTIFIED BY THE DEVELOPMENT OFFICE OF STPI. 5. IN RESPONSE TO THE ABOVE THE ASSESSEE SUBMITTED A LETTER DATED 06.10.2009 IN WHICH IT WAS STATED THAT THE RE GISTERED OFFICE OF THE ASSESSEE WAS IN MAHIM AND THE ADMINISTRATIVE OFFICE WAS IN DADAR. IT WAS FURTHER STATED THAT ITS PLACE OF BUS INESS WAS UNIT NOS: 4 TO 9 THIRD FLOOR AND UNIT NO: 12 SECOND FLOOR HIND SERVICE INDUSTRIAL PREMISES BEHIND PARKWAY HOTEL SHIVAJI PARK DADAR MUMBAI. IT WAS STATED THAT THIS IS AS PER THE PART NERSHIP DEED DATED ITA NO: 3403/MUM/2010 4 01.11.2003. IT WAS CLARIFIED THAT THE INITIAL BUSI NESS ADDRESS WAS THAT OF THE RESIDENCE OF THE PARTNER IN MAHIM AND T HEREAFTER THE FIRM ACQUIRED LEAVE & LICENCE OF UNIT NOS: 4 TO 9 AND UN IT NO: 12 IN HIND SERVICE INDUSTRIAL PREMISES DADAR AND THAT TH IS ADDRESS AS A PLACE OF BUSINESS WAS APPROVED AND INCORPORATED BY THE STPI NAVI MUMBAI IN THEIR LETTER OF PERMISSION AND THIS WAS A LSO DULY CUSTOM BONDED AS PER THE TERMS OF STPI REGISTERED UNITS. THE ASSESSEE FILED A COPY OF THE LETTER OF PERMISSION ISSUED BY STPI NAVI MUMBAI DULY INCORPORATING THE BUSINESS PREMISES AN D COPY OF THE CUSTOM BONDING BY THE COMMISSIONER OF CUSTOMS. IT WAS ALSO POINTED OUT THAT AS PER STPI SCHEME AN UNIT CAN BE SET UP ANYWHERE IN INDIA AND THERE WAS NO NOTIFIED AREA. A COPY OF THE SAID SCHEME WAS ALSO FILED. 6. AFTER EXAMINING THE ASSESSEES SUBMISSIONS AND T HE PAPERS FILED BY IT THE ASSESSING OFFICER NOTED THAT IN OR DER TO AVAIL OF THE BENEFIT OF SECTION 10A THE UNDERTAKING SHOULD BEGI N TO MANUFACTURE ANY ARTICLE OR THING IN ANY ELECTRONIC HARDWARE PAR K OR SOFTWARE TECHNOLOGY PARK OR SPECIAL ECONOMIC ZONE. ACCORDIN G TO HIM IN MUMBAI SOFTWARE TECHNOLOGY PARK / SPECIAL ECONOMIC ZONE (SEZ) WERE SET UP BY THE GOVERNMENT OF INDIA ONLY IN SEEP Z ANDHERI EAST AND INTERNATIONAL INFOTECH PARK AT NAVI MUMBAI . THE ASSESSEES UNIT WAS NOT SET UP IN THESE PLACES. IT WAS SET UP IN HIND SERVICE INDUSTRIAL PREMISES BEHIND PARKWAY HO TEL SHIVAJI PARK DADAR AND THEREFORE IT WAS NOT LOCATED IN AN STP OR SEZ. ACCORDINGLY HE HELD THAT THE ASSESSEE FIRM WAS NOT ELIGIBLE FOR THE ITA NO: 3403/MUM/2010 5 CLAIM UNDER SECTION 10A OF THE ACT. HE ACCORDINGLY DISALLOWED AND ADDED BACK THE CLAIM OF ` 8 45 47 524/-. 7. THE ASSESSEE APPEALED TO THE CIT(A) WHO EXAMINE D THE FACTS AND THE RECORD AND RECORDED THE FOLLOWING FIN DINGS: - (1) IT IS AN UNDISPUTED FACT THAT THE UNIT OF THE ASSESSEE IS REGISTERED WITH STPI VASHI NAVI MUMBAI AND THAT THE DIRECTOR OF STPI HAS ISSUED APPROVAL TO THE ASSESSEE ON 20.03.2004 PERMITTING THE ASSESSEE TO CARRY ON THE BUSINESS ACTIVITY FROM UNIT NOS: 4 TO 9 THIRD FLOOR AND UNIT NO: 12 SECOND FLOOR OF HIND SERVICE INDUSTRIAL PREMISES BEHIND PARKWAY HOTEL SHIVAJI PARK DADAR MUMBAI. (2) THE AFORESAID PREMISES IS ALSO A CUSTOMS DUTY-FREE BONDED AREA LICENSED BY THE COMMISSIONERATE OF CUSTOMS MUMBAI. (3) AS PER THE STPI SCHEME FORMULATED BY THE GOVERNMENT OF INDIA THE STP UNIT CAN BE SET UP ANYWHERE IN INDIA AND THERE IS NO NOTIFIED AREA. IN THE PERMISSION DATED 20.03.2004 ISSUED BY STPI IT HAS BEEN MENTIONED THAT THE ASSESSEE IS ELIGIBLE FOR ALL THE FACILITIES AND PRIVILEGES AVAILABLE UNDER THE STP SCHEME INCLUDING TAX ITA NO: 3403/MUM/2010 6 HOLIDAY AS PER SECTION 10A OF THE INCOME TAX ACT 1961. (4) STPI IS AN AUTONOMOUS BODY FORMED TO PROMOTE STPS IN INDIA. IT IS NOT BY ITSELF AN STP. IT IS A BODY FUNCTIONING UNDER THE MINISTRY OF COMMUNICATIONS AND INFORMATION TECHNOLOGY. IT IS THIS BODY THAT HAS GIVEN PERMISSION TO THE ASSESSEE VIDE LETTER DATED 20.03.2004. (5) THE CBDT IN ITS INSTRUCTION NO:1/2006 DATED 31.03.2006 HAS CLARIFIED SECTION 10A TO THE EFFECT THAT AN STP MAY BE AN INDIVIDUAL UNIT BY ITSELF. (6) THE STPI ITSELF HAS CLARIFIED THIS ISSUE BY WAY OF FREQUENTLY ASKED QUESTIONS (FAQ). IN ANSWER TO A QUESTION WHETHER AN UNIT CAN BE SET UP IN THE FIRMS OWNED PREMISES STPI HAS ANSWERED THAT SINCE SOFTWARE INDUSTRY IS A NON-POLLUTING INDUSTRY IT CAN BE SET UP IN ANY LOCATION. IT CAN EITHER BE AN INDIVIDUAL UNIT BY ITSELF OR IT CAN BE ONE SUCH UNIT LOCATED IN AN AREA DESIGNATED AS STP COMPLEX. (7) IN ITS PERMISSION DATED 20.03.2004 STPI HAS STATED CLEARLY THAT THE ASSESSEE IS GRANTED PERMISSION TO SET UP STP UNIT ITA NO: 3403/MUM/2010 7 LOCATED AT UNIT 1 212 HIND SERVICE INDUSTRIAL PREMISES BEHIND PARKWAY HOTEL SHIVAJI PARK DADAR MUMBAI. EVEN IN ANNEXURE II OF THIS LETTER THERE IS SPECIFIC MENTION THAT AN STP UNIT MAY BE A STAND- ALONE UNIT OR ONE OF THE UNITS LOCATED IN AN STP COMPLEX. (8) THE COMMISSIONERATE OF CUSTOMS HAS RECOGNIZED THE ASSESSEE AS A 100% EXPORT ORIENTED UNDERTAKING (EOU) AND THE LICENSE ISSUED UNDER SECTION 58 OF THE CUSTOMS ACT 1962 SAYS THAT THE ASSESSEE IS EXEMPT FROM PAYMENT OF CUSTOMS OR CENTRAL EXCISE DUTY SUBJECT TO CONDITIONS AND THAT THE ASSESSEES PREMISES ARE SITUATED AT GALA NO:212 SECOND FLOOR HIND SERVICE INDUSTRIAL PREMISES SHIVAJI PARK DADAR MUMBAI. THE COMMISSIONERATE HAS ISSUED ANOTHER PERMISSION ON 12.04.2004 FOR MANUFACTURING-IN-BOND UNDER SECTION 65 OF THE CUSTOMS ACT 1962. (9) IN THE ASSESSMENT ORDERS FOR THE ASSESSMENT YEARS 2005-06 AND 2006-07 THE ASSESSING OFFICER HAD ALLOWED EXEMPTION BY RECORDING THE FOLLOWING OBSERVATIONS: - ITA NO: 3403/MUM/2010 8 THE BUSINESS OF THE ASSESSEE FIRM IS PROVIDING COMPUTER SOFTWARE AND IT ENABLED SERVICES ON WHICH ASSESSEE HAS CLAIMED DEDUCTION U/S.10A OF I. T. ACT BEING 100% EXPORT ORIENTED. THE ASSESSEE HAS FURNISHED ALL THE RELEVANT DETAILS CALLED FOR. AFTER GOING THROUGH THE DETAILS/DOCUMENTS FILED THE RETURNED INCOME OF THE ASSESSEE IS ACCEPTED. AFTER RECORDING THE AFORESAID FINDINGS THE CIT(A) NOTED THAT WHEN THERE IS NO CHANGE IN THE FACTS OR IN THE LEGAL POS ITION THE ASSESSING OFFICER WAS NOT JUSTIFIED IN NOT FOLLOWIN G HIS ORDERS FOR THE EARLIER YEARS CONTRARY TO THE PRINCIPLE OF CONSISTE NCY LAID DOWN BY THE SUPREME COURT IN THE CASE OF RADHASOAMI SATSANG VS. CIT (1992) 193 ITR 321 (SC). HE REITERATED THAT THE AS SESSING OFFICER HAS NOT BROUGHT ON RECORD ANY NEW FACTS WHICH WERE NOT CONSIDERED IN THE EARLIER YEARS. HE HELD THAT THE PROVISIONS OF SECTION 10A ARE FOR PROMOTING ECONOMIC GROWTH AND THEY HAVE TO BE I NTERPRETED LIBERALLY SO AS TO ADVANCE THE OBJECTIVE. IN THIS VIEW OF THE MATTER HE DIRECTED THE ASSESSING OFFICER TO ALLOW THE EXEM PTION UNDER SECTION 10A OF THE ACT AS CLAIMED BY THE ASSESSEE. 8. THE REVENUE IS IN APPEAL. THE LEARNED SENIOR DR ACKNOWLEDGED THAT THE ASSESSING OFFICER ALLOWED EXE MPTION IN THE EARLIER TWO YEARS IN SCRUTINY ASSESSMENTS FRAMED UN DER SECTION 143(3) OF THE ACT BUT SUBMITTED THAT ON A STRICT C ONSTRUCTION OF THE EXEMPTION PROVISION IT WOULD APPEAR THAT THE ASSESS ING OFFICER DID NOT PROPERLY APPLY HIS MIND TO THE CLAIM IN THOSE Y EARS. HE FURTHER POINTED OUT THAT THE STPI HAS APPROVED ONLY UNIT NO :1 IN THE PREMISES IN HIND SERVICE INDUSTRIAL PREMISES SHIVA JI PARK DADAR ITA NO: 3403/MUM/2010 9 MUMBAI AND UNIT NOS: 4 TO 9 DO NOT FIND MENTION IN THE APPROVAL A COPY OF WHICH IS AT PAGE 25 OF THE ASSESSEES PAPER BOOK. HE CONTENDED THAT THERE IS SOME CONFUSION IN THE MATTE R AND THAT IT WOULD BE BETTER IF THE ASSESSING OFFICER IS ALLOWED TO RE-EXAMINE THE FACTS. 9. ON THE OTHER HAND THE LEARNED COUNSEL FOR THE A SSESSEE SUBMITTED THAT THE STP APPROVAL AT PAGE 24 OF THE P APER BOOK INCLUDED UNITS 4 TO 9 ALSO. HE ALSO FILED A COPY O F THE LETTER DATED 03.05.2006 ISSUED BY STPI WHICH ALSO REFERRED TO T HE EXTENSION OF THE APPROVAL TO UNITS 4 TO 9. HE SUBMITTED THAT SI NCE THE GREEN CARD (PAGE 24 OF THE PAPER BOOK) WAS ALREADY FILED BEFOR E THE ASSESSING OFFICER AND IT INCLUDED UNITS 4 TO 9 THERE IS NO N EED TO SEND THE MATTER BACK TO THE ASSESSING OFFICER FOR ANOTHER RO UND OF VERIFICATION. THE LEARNED COUNSEL FOR THE ASSESSEE POINTED OUT THAT THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2005-0 6 IS A DETAILED ORDER IN WHICH THE APPROVALS ISSUED BY STP I WERE REFERRED TO AND THAT THE ASSESSMENT ORDER FOR THE ASSESSMENT YEAR 2006-07 WAS PASSED BY AN OFFICER OF THE RANK OF ADDITIONAL CIT AND THEREFORE IT CANNOT BE STATED THAT THE ASSESSEES C LAIM DID NOT RECEIVE SCRUTINY IN THOSE YEARS. HE ALSO REFERRED TO THE OTHER IMPORTANT PAPERS COMPILED IN THE PAPER BOOK WHICH S UPPORTED THE ASSESSEES CLAIM. 10. ON A CAREFUL CONSIDERATION OF THE MATTER WE ARE SATISFIED THAT THE ASSESSEE IS ENTITLED TO THE EXEMPTION AND THAT THERE IS NO NEED TO SEND THE MATTER BACK FOR FURTHER VERIFICATION. NONE OF THE FINDINGS RECORDED BY THE CIT(A) HAS BEEN CONTROVERTED BEFORE US ON BEHALF ITA NO: 3403/MUM/2010 10 OF THE REVENUE. THE GREEN CARD ISSUED BY THE STPI ON 24.03.2004 ITSELF MENTIONS UNIT NOS: 4 TO 9 IN HIND SERVICE IN DUSTRIAL PREMISES BEHIND PARKWAY HOTEL SHIVAJI PARK DADAR MUMBAI A LSO AND IT IS A COPY OF THIS GREEN CARD THAT IS FILED BY THE ASSESS EE AT PAGE 24 OF THE PAPER BOOK. THE LETTER DATED 03.05.2006 ISSUED BY THE STPI A COPY OF WHICH HAS BEEN FILED BEFORE US ON BEHALF OF THE ASSESSEE MERELY CONFIRMS THE INCLUSION OF UNITS 4 TO 9. THE RE IS A STATEMENT IN THIS LETTER TO THE EFFECT THAT THE ENDORSEMENT F OR THE EXPANSION OF STP FACILITY TO UNIT NOS: 4 TO 9 HAS BEEN MADE IN T HE GREEN CARD AND IS RETURNED HEREWITH. THIS CLEARLY SHOWS THAT IT IS A GREEN CARD ISSUED BY THE STPI WHICH IS MORE IMPORTANT AND THAT INCLUDES UNIT NOS: 4 TO 9. THEREFORE THE QUERY RAISED BY THE LE ARNED SENIOR DR IS ALREADY ANSWERED BY THE GREEN CARD WHICH WAS BEF ORE THE DEPARTMENTAL AUTHORITIES. 11. THE VARIOUS OTHER PAPERS WHICH ARE REFERRED TO BY THE LEARNED COUNSEL FOR THE ASSESSEE MAY BE NOTICED. T HE LETTER OF PERMISSION DATED 20.03.2004 CONTAINS TWO ANNEXURES. ANNEXURE-II NOTES THAT AN STP UNIT MAY BE A STAND-ALONE UNIT OR ONE OF THE UNITS LOCATED IN ANY STP COMPLEX (PAGE 31 OF THE PAPER BOOK). PAGE 57 OF THE PAPER BOOK IS A COPY OF THE FREQUENT LY ASKED QUESTIONS AND THE ANSWERS GIVEN BY STPI. THIS HAS BEEN NOTICED BY THE CIT(A) IN HIS ORDER. PAGE 55 IS INSTRUCTION NO:1/2006 ISSUED BY THE CBDT ON 31.03.2006. IN PARA 3 THERE IS REFE RENCE TO THE STP SCHEME IN WHICH IT HAS BEEN STATED THAT AN STP UNIT MAY BE AN INDIVIDUAL UNIT BY ITSELF OR IT MAY BE ONE OF SU CH UNITS LOCATED IN AN AREA DESIGNATED AS STP COMPLEX BY THE DEPARTMENT OF ITA NO: 3403/MUM/2010 11 ELECTRONICS. THIS ANSWERS THE ASSESSING OFFICERS DOUBT WHETHER THE UNIT OF THE ASSESSEE CAN BE ALLOWED THE EXEMPTI ON UNDER SECTION 10A OF THE ACT EVEN THOUGH IT IS NOT SITUA TED IN AN STP COMPLEX OR IN A SPECIAL ECONOMIC ZONE (SEZ). PAGE 59 OF THE PAPER BOOK IS ALSO A PART OF THE FAQ IN WHICH IT HA S BEEN STATED BY THE STP THAT SOFTWARE UNIT BEING A NON-POLLUTING IN DUSTRY CAN BE SET UP IN ANY LOCATION AND THAT IT CAN BE AN INDIVIDUAL UNIT BY ITSELF OR AN UNIT LOCATED IN AN AREA DESIGNATED AS STP COMPLEX. IT IS THIS ASPECT WHICH HAS ALSO BEEN ADVERTED TO IN THE INSTR UCTION ISSUED BY THE CBDT. THE ANSWER GIVEN BY THE STPI TO QUESTION NO:24 OF THE FAQ (PAGE 60) SHOWS THAT A PARTNERSHIP CAN ALSO SET UP AN UNIT. THE ASSESSEE HEREIN IS A PARTNERSHIP AND THEREFORE IS ELIGIBLE TO CLAIM THE EXEMPTION. THUS THE DOCUMENTATION FILED BY THE ASSESSEE IN THE PAPER BOOK ALSO SUPPORTS ITS CLAIM. THEY HA VE ALSO BEEN REFERRED TO BY THE CIT(A) IN HIS ORDER. 12. THE LEARNED COUNSEL FOR THE ASSESSEE REFERRED T O AN ORDER OF THE DELHI BENCH OF THE TRIBUNAL IN THE CASE OF XERO X INDIA LTD. VS. ACIT (2010) 127 TTJ 84 (DEL). ONE OF THE SPECIFIC GROUNDS TAKEN IN THIS CASE BY THE REVENUE WAS WHETHER FOR THE PURPOS E OF SECTION 10A ANY SOFTWARE PRODUCTION UNIT HAS TO BE PHYSICAL LY LOCATED WITHIN THE SOFTWARE TECHNOLOGY PARK IN ORDER TO BE CONSIDE RED AS STP UNIT. AFTER DETAILED ANALYSIS OF THE SECTION AND THE OTHE R RELEVANT NOTIFICATIONS / INSTRUCTIONS ISSUED BY THE MINISTRY OF COMMERCE THE BENCH OPINED THAT THERE IS NO REQUIREMENT THAT THE PARTICULAR UNIT SHOULD BE LOCATED INSIDE A SOFTWARE TECHNOLOGY PARK AND THAT IT WAS ITA NO: 3403/MUM/2010 12 SUFFICIENT IF THE INDIVIDUAL UNIT AT A PARTICULAR L OCATION IS NOTIFIED BY THE STPI. THIS DECISION ALSO SUPPORTS THE ASSESSEE HEREIN. 13. WE ARE THEREFORE IN FULL AGREEMENT WITH THE DEC ISION OF THE CIT(A) THAT THERE IS NO REQUIREMENT THAT THE SOFTWA RE PRODUCTION UNIT SHOULD BE LOCATED IN THE SOFTWARE TECHNOLOGY PARK I N ORDER TO OBTAIN EXEMPTION UNDER SECTION 10A OF THE ACT. THERE IS A LSO NO DOUBT THAT BOTH UNIT NO:1 AND UNIT NOS: 4 TO 9 HAVE BEEN APPROVED BY THE STPI. FURTHER THE ASSESSEES CLAIM HAS BEEN ACCEPT ED IN THE EARLIER TWO ASSESSMENT YEARS AFTER DUE SCRUTINY AND THERE IS NO JUSTIFICATION TO DEPART FROM THE SAME. THE ORDER O F THE DELHI BENCH OF THE TRIBUNAL CITED SUPRA IS ALSO IN FAVOUR OF TH E ASSESSEE ON THE QUESTION WHETHER THERE IS ANY REQUIREMENT THAT THE UNIT SHOULD BE LOCATED ONLY INSIDE AN STP. WE ACCORDINGLY UPHOLD THE DECISION OF THE CIT(A) AND DISMISS THE APPEAL FILED BY THE REVE NUE WITH NO ORDER AS TO COSTS. ORDER PRONOUNCED IN THE OPEN COURT ON 15 TH JULY 2011. SD/- SD/- (B RAMAKOTAIAH) (R V EASWAR) ACCOUNTANT MEMBER PRESIDE NT MUMBAI DATED 15 TH JULY 2011 SALDANHA COPY TO: 1. M/S PAR WEB SOLUTIONS 212 HIND SERVICE IND. 2 ND FLOOR B K MARG SHIVAJI PARK DADAR (WEST) MUMBAI 400 028 2. ITO 15(1)(4) MUMBAI 3.CIT-15 MUMBAI 4. CIT(A)-26 MUMBAI 5.DR C BENCH TRUE COPY BY ORDER ASSTT. REGISTRAR ITAT MUMBAI