Income Tax Appellate Tribunal Hyderabad M/S. Semantic Space Technologies Ltd, ... vs Department Of Income Tax on 7 March, 2012 IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH 'B', HYDERABAD BEFORE SHRI CHANDRA POOJARI, ACCOUNTANT MEMBER AND SMT. ASHA VIJAYARAGHAVAN, JUDICIAL MEMBER. ITA No.458/Hyd/2011 (Assessment Year 200708) M/s. Semantic Space V/s Dy. Commissioner of Incometax, Technologies Ltd., Hyderabad Circle 3(1), Hyderabad. (PAN AAGCS 6868 P ) (Appellant) (Respondent) AND ITA No.474/Hyd/2011 (Assessment Year 200708) Asst. Commissioner of Income V/s M/s. Semantic Space Technologies tax, Circle 3(1), Hyderabad. Ltd., Hyderabad (PAN AAGCS 6868 P ) (Appellant) (Respondent) Assessee by : Shri C.S.Subrahmanyam & Shri V.Sivakumar Department by : Shri M.S. Rao Date of Hearing 30/05/2012 Date of Pronouncement ORDER Per Chandra Poojari, A.M., These are the crossappeals directed against the order of the Commissioner of Incometax(Appeals)IV, Hyderabad, passed on 30/12/2010, for the assessment year 200708. 2 ITA Nos. 458 & 474/Hyd/11 M/s. Semantic Space Technologies Ltd., Hyderabad ITA NO. 458/HYD/2011 APPEAL BY THE ASSESSEE 2. Originally the assessee filed its grounds of appeal from 1 to 4, 5 to 5.7, 6 to 6.2, 7 to 7.2, 8 & 8.1 and 9, which were summarized as ground Nos. 1 to 12. Therefore, this appeal is disposed off based on the summarized grounds of appeal. 3. Ground No. 1 is general in nature. 4. Ground No. 2 is directed against the action of the CIT(A) in directing the exclusion of the interest income of Rs. 1,57,409 for purposes of computing eligible income u/s 10A of the Act. 5. We have heard the arguments of both the parties, perused the record and gone through the orders of the authorities below. We find that similar issue, on identical facts and circumstances, came up for consideration before the Tribunal in assessee's own case for AY 200607 in ITA No.s 824/Hyd/10 and 915/Hyd/10 vide order dated 07/03/2012 wherein the coordinate bench vide paras 12 to 15 held as under: "12. As for the first issue relating to interest income of Rs.1,09,087, mentioned in ground No.2 of the summarized grounds of appeal, the facts in brief are that the assessee received interest amount of Rs.1,09,087 and pleaded for inclusion of the same as profits of the business eligible for exemption under S.10A of the Act. The assessing officer held that this income is outside the operational income, and accordingly excluded the same from the scope of S.10A and taxed the same as income under the head 'other sources'. In the process, the assessing officer relied on the decision of the Apex Court in Sterling Foods (1999)237 ITR 579. Before the CIT(A), the assessee pleaded that the interest derived on account of temporary parking of business funds constitutes income derived from its export activity. The CIT(A) relying on the Mumbai Bench decision of the Tribunal in the case of Renaissance Jewellery P. Ltd. V/s.ITO(101 ITD 380), confirmed the disallowance made by the assessing officer. Aggrieved by the same, assessee is in appeal before us on this issue. 3 ITA Nos. 458 & 474/Hyd/11 M/s. Semantic Space Technologies Ltd., Hyderabad 13. Learned counsel for the assessee, reiterating the contentions urged before the lower authorities, submitted that the interest income derived by temporary parking of funds constitutes export income of the assessee, and hence is eligible for deduction under S.10A of the Act. 14. On the contrary, the Learned Departmental Representative strongly supported the orders of the CIT(A) and relied on the decisions cited by him in the impugned order. 15. On hearing both sides, we find that the issue of granting deduction on interest received, has now reached finality at the levels of the High Court, say by the decision of the Chattisgarh High Court in the case of Nav Bharat Explosives Co. Pvt. Ltd. (337 ITR 0515), wherein it was held that the income by way of interest on fixed deposits is not eligible for special deduction under S.10A. Therefore, we uphold the impugned orde