TP adjustment made in software development segment and in respect of ITES segment

This Income Tax Appellate Tribunal (ITAT) Hyderabad case involved an assessee appealing against the Assessing Officer's (AO) computation of long-term capital gains. The AO had upheld the capital gains at Rs. 41,04,732/-. The tribunal noted that the AO had imposed a penalty for non-compliance with notices but had not recorded satisfaction for this penalty in the assessment order. Citing a precedent, the tribunal allowed the assessee's appeal.

IN THE INCOME TAX APPELLATE TRIBUNAL
HYDERABAD BENCHES “B”: HYDERABAD
(THROUGH VIRTUAL CONFERENCE)
BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER
AND
SHRI LAXMI PRASAD SAHU, ACCOUNTANT MEMBER

ITA No. 1279 & 1280/H/2017
Assessment Year: 2012-13

Kalawathi Bagayath,
Hyderabad.
PAN – AEQPB 7777K

vs

Asst. Commissioner of Income-tax,
Circle – 4(1), Hyderabad.

Assessee by: Shri P. Murali Mohana Rao
Revenue by: Shri Rohit Mujumdar
Date of hearing: 17/06/2021
Date of pronouncement: 30/08/2021

O R D E R

In this appeal the assessee has raised 11 (1 to 11) grounds of appeal and raised additional grounds off appeal from 12 to 17, the sum and substance of which are against the action of the CIT(A) in upholding the computation of long term capital gains u/s 50C of the Act at Rs. 41,04,732/- by the AO.

2.Briefly the facts of the case are that during the course of the assessment proceedings, the Assessing officer noticed that the assessee claimed Long term capital gain of Rs.12,60,561/-. The Assessing Officer noticed that the assessee had showed receipt of Rs .6,68,50,000/- towards sale consideration of the commercial property located at 1-1-152 to 155, admeasuring 2474 Sq. Yards of Land at S.D. Road Secunderabad to M/s. Yasoda Health Services Pvt ltd on 14.11.2011.

3. When the assessee preferred an appeal before the CIT(A), against the order of AO, the CIT(A) upheld the order of AO.

4. After hearing both the parties and perusing the material on record as well as the orders of authorities below, it is observed that penalty has been imposed by the AO u/s 271(1)(b) for not complying with the notices issued dated 19/01/2015 by the AO u/s 142(1) of the Act. We find from the order of the AO that assessment was completed u/s 143(3) of the Act on 30/03/2015 and in the assessment order, the AO has not recorded any satisfaction for imposing penalty u/s 271(1)(b) of the Act. We find that similar issue has been decided by the ITAT, Delhi Benches in the case of Globus Infocom Ltd Vs. DCIT in ITA No. 738/Del/2014, order dated 29/06/2016.

5. In the result, both the appeal of the assessee in ITA No. 1279/Hyd/2017 and in ITA No. 1280/Hyd/2017 are allowed.
Pronounced in the open court on 30th August, 2021.

Please find attached the enclosed file for the full judgement