DCIT, Circle-10(1), New Delhi Vs. Genpact India (now merged with Genpact India Pvt. Ltd.)

Parties Involved

Facts Summary

The assessee, Genpact India, is a resident corporate entity engaged in providing Information Technology Enabled Services (ITES). For the assessment year 2010-11, the assessee filed a revised return of income declaring income of Rs.4,938,767,156/-. The Assessing Officer noticed that the assessee had computed deductions under section 10A and 10AA of the Income-tax Act, including interest on fixed deposits, interest on inter-corporate deposits, and interest on employees' loans as part of its profits and gains of business and profession. The Assessing Officer excluded these incomes from the purview of profits and gains of business and profession while computing deduction under section 10A. The assessee contested this disallowance before the first appellate authority, which deleted the disallowance. The Revenue challenged this decision before the Income Tax Appellate Tribunal.…

Legal Issues

• 1. Deletion of disallowances made by the Assessing Officer while computing deduction under section 10A and 10AA of the Income-tax Act.
• 2. Allowance of claim of deduction under section 10A and 10AA of the Act in respect of income from Foreign Exchange Gain & Forward Contract Gain.
• 3. Allowance of 95% of the cost recoveries to be set off against the expenses.
• 4. Allowance of customer discount amounting to Rs. 1,94,92,305/-.
• 5. Deletion of disallowance of Rs.37,61,346/- on account of excess depreciation on computer peripherals.
• 6. Deletion of addition of Rs.534,48,00,000/- made by the Assessing Officer on account of non-deduction of tax at source on payment made to Genpact Mauritius entities.

Judgment Outcome

Decided in favour of Partly Assessee / Partly Revenue.

Precedents Relied Upon

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