ITAT grants relief to Wipro GE Healthcare, orders re-computation of deductions
The Income Tax Appellate Tribunal (ITAT) remitted the matter to the Assessing Officer (AO) for re-computation of deduction that is permitted under Section 10A of the Income Tax Act, 1961, (IT Act) and it granted relief to Wipro
M/s Wipro GE Healthcare Private Limited (appellant) is engaged in the business of manufacture, sale, and service of medical diagnostic equipment and accessories. The appellant is also engaged in software development and trading in various products.
An appeal was filed by the appellant before the ITAT. The ground of the appeal urged in all the three years related to the issue of re-computation of deduction allowable under Section 10A of the IT Act.
The appellant further submitted that the ITAT had restored the issue of transfer pricing adjustment made regarding the royalty payment only. However, while giving effect to the order of the ITAT, the Assessing Officer (AO) has exceeded his jurisdiction by altering the deduction allowed under Section 10A of the IT Act.
The appellant further contended that he was not given an opportunity by the AO and the Commissioner of Income Tax (Appeals) [CIT(A)] has also upheld the action of the AO, without considering the jurisdictional aspect. The appellant submitted that the deduction under Section 10A of the IT Act is allowed at the undertaking level and not at the entity level. CIT(A) taken into consideration the profits available at the entity level while adjudicating the issue, which was an incorrect proposition of law.
The matter was listed before the Coarm headed by the Vice President, N.V. Vasudevan of the ITAT. The ITAT on 9 January 2021 set aside the order passed by CIT(A) taking all the years under consideration and restored the same to the file of the AO.