Income Tax Appellate Tribunal Chennai Polaris Software Lab Limited, Chennai vs Dcit, Chennai on 18 August, 2017 आयकर अपील य अ धकरण, 'डी' यायपीठ, चे नई IN THE INCOME TAX APPELLATE TRIBUNAL 'D' BENCH, CHENNAI ी एन.आर.एस. गणेशन, या यक सद य एवं ी संजय अरोड़ा, लेखा सद य केसम& BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI SANJAY ARORA, ACCOUNTANT MEMBER आयकर अपील सं./ITA No.1218/Mds/2016 नधा)रण वष) / Assessment Year : 201011 & आयकर अपील सं./ITA No.615/Mds/2016 नधा)रण वष) / Assessment Year : 201112 M/s Polaris Consulting & The Principal Commissioner of Services Limited, v. Income Tax, Chennai5, No.244, Polaris House, The Deputy Commissioner of Anna Salai, Chennai 600 006. Income Tax, Corporate Circle 5(2), Chennai 600 034. PAN : AAACP 4341 E (अपीलाथ/Appellant) (./यथ/Respondent) आयकर अपील सं./ITA No.765/Mds/2016 नधा)रण वष) / Assessment Year : 201112 The Deputy Commissioner of M/s Polaris Consulting & Services Income Tax, v. Limited, Corporate Circle 5(2), No.244, Polaris House, Chennai 600 034. Anna Salai, Chennai 600 006. (अपीलाथ/Appellant) (./यथ/Respondent) नधा)0रती क2 ओर से /Assessee by : Shri N. Venkatraman, Sr. Advocate Shri V. Ubhaya Bharathi, Advocate राज व क2 ओर से /Revenue by : Shri Pathlavath Peerya, CIT सन ु वाई क2 तार ख/Date of Hearing : 07.07.2017 घोषणा क2 तार ख/Date of Pronouncement : 18.08.2017 2 I.T.A. No.1218, 765 & 615/Mds/16 आदे श /O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: I.T.A. No.1218/Mds/2016 filed by the assessee is directed against the order of the Principal Commissioner of Income Tax, Chennai5, Chennai, dated 24.02.2016. The other two appeals are filed by the assessee and Revenue for the assessment year 2011 12 against the order of the Dispute Resolution Panel2, Bangalore, dated 30.12.2015. Since common issues arise for consideration in all these appeals, we heard these appeals together and disposing of the same by this common order. 2. There was a delay of 24 days in filing the appeal by the Revenue. The Revenue has filed a petition for condonation of delay. We have heard the Ld. Departmental Representative and Ld. Sr. counsel for the assessee. We find that there was sufficient cause for not filing the appeal before the stipulated time. Therefore, we condone the delay and admit the appeal filed by the Revenue. Let's first take I.T.A. No.1218/Mds/2016. 3. Shri N. Venkatraman, the Ld. Sr. counsel for the assessee, submitted that the assessee claimed deduction under Section 10A of the Incometax Act, 1961 (in short 'the Act') to the extent of 3 I.T.A. No.1218, 765 & 615/Mds/16 `76,83,44,038/. In fact, the Assessing Officer allowed the claim of the assessee. However, according to the Ld. Sr. counsel, the Principal Commissioner found that the assessee has two units, namely, 10A eligible unit and non 10A unit. The profit of the eligible 10A unit was 24.6% as against 5.42% in respect of non 10A unit. The Principal Commissioner also found that the assessee was not maintaining any separate books of account for eligible 10A unit. Therefore, according to the Ld. Sr. counsel, the Principal Commissioner concluded that the assessee has declared lesser profit in respect of non 10A unit by reducing the taxable profit by booking excessive expenditure. 4. The Ld. Sr. counsel for the assessee further submitted that the non 10A unit includes a branch at USA. In the US branch, the nature of the business was such that the profit was at a lower rate. According to the Ld. Sr. counsel, the profit and turnover of the US branch of the assessee cannot be considered, hence, the Principal Commissioner is not justified in exercising his revisional jurisdiction. According to the Ld. Sr. counsel, as far as the assessee's business is concerned, there was no distinction between eligible 10A unit and noneligible 10A unit. According to the Ld. Sr. counsel, it is not 4 I.T.A. No.1218, 765 & 615/Mds/16 mandatory to maintain separate books one for eligible 10A unit and another for noneligible 10A unit. The assessee being Indian multinational company, eligible for deduction under Section 10A of the Act, therefore, according to the Ld. Sr. counsel, the Principal Commissioner is