Bengaluru East Taluk, Bengaluru560 103. PAN AAACH 4151 J APPELLANT RESPONDENT Appellant by : Smt. Shreya Loyalaka, Advocate Respondent by : Shri Sumer Singh Meena, CIT (DR) Date of Hearing : 01.06.2022 Date of Pronouncement : 26.08.2022 ORDER PER LAXMI PRASAD SAHU, ACCOUNTANT MEMBER: This appeal filed by the assessee is against the order of CIT(A)3, Bangalore dated 18.07.2018 for the assessment year 201213 with the following grounds of appeal: 1.The aforementioned order of the learned CIT(A) with respect to transfer pricing adjustment, disallowance of deduction claimed under section 80JJAA of the Act, disallowance of software expenditure, and disallowance of payment of legal and professional expenditure is based on incorrect interpretation of law and therefore, is bad in law, and hence, liable to be modified. Disallowance of deduction claimed under section 80JJAA of the Act 2. The learned CIT(A) has erred, in law and in facts, in confirming the disallowance under section 80JJAA of the Act amounting to 23,20,36,444. ITA No.2889/Bang/2018 Page 2 of 42 3. The learned CIT(A) has erred, in law and in facts, in concluding that the Appellant does not satisfy the conditions for claiming deduction under section 80JJAA of the Act. 4. The learned CIT(A) has erred, in law and in facts, in concluding that deduction under section 80JJAA of the Act is available only for those workmen who have completed 300 days during the particular previous year relevant to the assessment year for which deduction is being claimed. The learned CIT(A) ought to have appreciated that the section is a beneficial provision for advancement of employment in the industries and the same must be construed liberally, thereby the deduction must be available for the workmen who have completed 300 days in a year. 5. Notwithstanding and without prejudice to Ground No. 4, the learned CIT(A) has erred, in law and in facts, in concluding that the employees who have not completed 300 days in this particular previous year should not be considered as a regular workman in the subsequent year as well. The learned CIT(A) ought to have appreciated that the benefit of hiring new workmen should be available in subsequent year for claim of deduction under section 80JJAA of the Act on the basis that such workmen are employed for 300 days. 6. Notwithstanding and without prejudice to Ground No. 4 and 5, the learned CIT(A) has erred in not appreciating that employees employed in the relevant assessment year who had not completed 300 days in that year should be considered for computing deduction under section 80JJAA in the subsequent year when he completes 300 days. 7. The learned CIT(A) has erred in facts, by contending that the appointment letters have not been submitted, without appreciating the fact that the same were duly submitted. 8. The learned CIT(A) has erred, in law and in facts, in concluding that the deduction under section 80JJAA of the Act is available only on additional wages paid to new regular workmen over and above 100 workmen employed during the year and such deduction is not available for initial 100 workmen. Disallowance of expense on annual maintenance contract and software 9. The learned CIT(A) has erred, in law and in facts, in disallowing Annual Maintenance Contract ("AMC") expenses of Rs. 11,28,69,585 and software expenses of Rs. 1,48,08,126 under section 40(a)(i)I 40(a)(ia) of the Act on account of nondeduction of tax at source. 10. The learned CIT(A) has erred, in law and in facts, in not granting the benefit of second proviso to section 40(a)(ia) read with first proviso to section 201(1) of the Act with respect to Rs. 18,86,916 in re