Telangana High Court
ITTA/731/2014 of The Commissioner of Income Tax-I, Vs M/s Ckar Systems [P] Ltd., on 31 December 2014
THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE SRI JUSTICE SANJAY KUMAR I.T.T.A. No. 731 of 2014 DATE: 31.12.2014 Between: The Commissioner of Income Tax(Central), Hyderabad. … Appellant And M/s. CKAR Systems Pvt. Ltd., Hyderabad. … Respondent This Court
THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTA
AND
THE HON’BLE SRI JUSTICE SANJAY KUMAR
I.T.T.A. No. 731 of 2014
DATE: 31.12.2014
Between:The Commissioner of Income Tax(Central),Hyderabad.
… Appellant
AndM/s. CKAR Systems Pvt. Ltd.,Hyderabad.
… Respondent
This Court made the following:
THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTISENGUPTAANDTHE HON’BLE SRI JUSTICE SANJAY KUMAR
I.T.T.A. No. 731 of 2014
Judgment:(per Hon’ble Sri Justice Sanjay Kumar)
The Revenue is in appeal aggrieved by the order dated19.10.2012 passed by the Income Tax Appellate Tribunal, HyderabadBench-A, Hyderabad in relation to the assessment year 2005-06. The following suggested questions of law are sought to be raised.
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1. Whether on the facts and in the circumstances ofthe case, the Tribunal was correct in upholding the orderof the CIT(A) holding that CUP method is the mostappropriate method for computing the ‘Arm’s LengthPrice’ ignoring the provisions of Rule 10C(2) of theIncome Tax Rules, 1962 which set out the parametersfor selection of most appropriate method ?
2. Whether on the facts and in the circumstances ofthe case, the Tribunal was correct in upholding the orderof the CIT(A) holding that communication charges haveto be excluded from total turnover if the same areexcluded from export turnover, without appreciating thatno adjustments can be made to total turnover as perprovisions of Section 10A of the Income Tax Act, 1961 ?
In so far as the first question is concerned, perusal of the order under appeal demonstrates that the assessee followed onepermissible method of computing the arms length price and the samewas held to be valid by the Tribunal. We see no reason to interferewith the order in so far as this aspect is concerned.
As regards the second issue, we find that the Tribunal hasmerely followed the decision of the Karnataka High Court in the caseof Tata Elxi Ltd., (115 TTJ 423). We are not persuaded to disagreewith the view taken by the Karnataka High Court.
Both the questions of law sought to be raised therefore have nosubstance. The appeal is devoid of merit and is dismissed. No costs.
_________________K.J. SENGUPTA, CJ
_________________SANJAY KUMAR, JDate: 31stDecember, 2014pnb