Deputing manpower abroad for software development eligible for tax exemption: K'taka HC
Bengaluru: The High Court of Karnataka has set aside three reassessment notices of the Income Tax Department against EIT Services India Ltd (formerly Hewlett Packard) for three assessment years issued by the Income Tax Department and ruled that deputing manpower abroad for software development is eligible for tax exemption under Section 10A of the IT Act.
The Commissioner of Income Tax (CIT), Bengaluru had ordered for the re-examination of the claim for deduction under Section 10A/80HHE of the Income Tax Act for the assessment years 2005-06, 2006-07 and 2007-08 on the ground that ''part of the petitioner's profits was related to rendering technical services outside India which was not eligible for deduction.''
The company filed three writ petitions challenging the re-assessment notices which was heard by the bench of Justice S Sunil Dutt Yadav.
The HC in its judgement on December 19 cited a circular issued by the Ministry of Finance in 2013 which clarified that ''expenditure incurred for services to develop software outside India could be allowed under Section 10A of the IT Act if deputation is for development of software.''
The HC in its judgement said, ''It is clear that the clarification stipulates that the benefits under Section 10A deductions can be availed of, if there exists a direct and intimate nexus or connection between the development of software abroad with the eligible units setup in India.'' Citing the circular, the HC also noted that deputing technical manpower abroad is not detrimental to benefits of exemption under Section 10A of the IT Act. The HC said that in this present case the clarification issued in the circular was relevant.
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IPL final shifted for bigger stadium, not ticket issue: Shivakumar
Bengaluru (PTI): Karnataka Deputy Chief Minister D K Shivakumar on Wednesday rubbished allegations that the IPL final venue was shifted from Bengaluru to Ahmedabad due to the distribution of tickets to MLAs.
Speaking to reporters, Shivakumar said the reason for the shift could be the availability of a larger stadium in Ahmedabad.
“Ahmedabad has a large stadium and can accommodate more spectators. That must be the reason the IPL final was shifted there. There is no connection between ticket distribution to MLAs and the venue change,” he said.
When asked about reports linking the venue shift to MLAs demanding tickets, he quipped, “In some places, 50 per cent of tickets are reserved.”
When reporters said the BCCI had indicated that the decision was linked to ticket issues, he responded, “Let them make such statements. I will respond appropriately.”
Bengaluru was originally expected to host the final as the Royal Challengers Bengaluru were the defending champions.
Ahmedabad will host the IPL final for a second successive season on May 31, the BCCI announced earlier in the day, while allotting Qualifier 1 to Dharamsala and two other playoff games to New Chandigarh.
The board, however, said the final venue was shifted “owing to certain requirements from the local association and authorities that were beyond the scope of BCCI’s established guidelines and protocols.”
Shivakumar declined to comment on the revocation of the suspension of Muslim leaders in Davanagere, saying it was a party decision.
Regarding the removal of MLC Naseer Ahmed as CM Siddaramaiah’s political secretary, he said the chief minister had already spoken on the matter.
“The CM has his own information. Party office-bearers have provided guidance. He was given certain responsibilities, which he did not handle properly, which is why he was removed,” Shivakumar said.
On MLC Abdul Jabbar, who resigned as the state Congress minority cell chief and was later expelled from the party, he said Jabbar had submitted his resignation, which the party accepted.
The Congress in Karnataka faced internal dissent in April when several Muslim leaders objected to the party fielding Samarth Shamanur as its candidate for the recently held Davanagere South Assembly bypoll.
They demanded that a Muslim candidate be fielded, citing the constituency’s substantial Muslim population. The party subsequently took disciplinary action against three leaders, including Jabbar and MLC Ahmed.
When asked about his and the CM’s visit to Delhi, he said, “We will go when the high command calls us. It is not appropriate to go without being called.”
On Congress supporting TVK in Tamil Nadu, Shivakumar said the decision was taken to keep the "BJP out of power and strengthen secular forces." Elections to the 234 Assembly constituencies were held on April 23, and the results were announced on May 4.
The Congress party, a long-time ally of the DMK, announced its support for TVK to form a government in Tamil Nadu and severed ties with the Dravidian major.
The incumbent DMK was trounced by the fledgling Tamilaga Vettri Kazhagam, led by Vijay, who secured 108 seats. “Despite pressure from the AIADMK and BJP, TVK did not align with them. Our party has taken this decision in the interest of secular forces and the welfare of Tamil Nadu,” Shivakumar said.
