Payment made for renewal of DOT licence should not fall under section 35ABB as it would fall more appropriately u/s 37

DECIDED BY: ITAT MUMBAI BENCH `I’: MUMBAI, IN THE CASE OF: Bharti Airtel Ltd. Vs.  ACIT, APPEAL NO: ITA No. 398/Mum/2006, DECIDED ON June 25, 2010,

ORDER

Per D.K. AGARWAL (JM).

These cross appeals preferred by the assessee and the revenue are directed against the separate orders dated 11.11.2005 for the Assessment Year 2002-03 and combined order dated 20.3.2009 for the Assessment Years 2003-04 and 2004-05 passed by the ld. CIT(A). The assessee has also filed cross objection for the Assessment Year 2002-03. Since facts are identical and issues involved are common, all these appeals and C.O. are disposed of by this common order for the sake of convenience.

2. Briefly stated facts of the case extracted from ITA No.398/M/2006 for Assessment Year 2002-03 are that the assessee company is engaged in the business of digital communication services for data, fax and video using Satellite technology, Internet Virtual Private Network (VPN) and trading and maintenance of equipment used in providing these services. The return was filed declaring total business loss of Rs.4,58,54,400/-. However, the assessment was completed at an income of Rs.10,10,11,270/- including the dis allowance of DOT license fee Rs.4,53,14,736/- Space Segment Charges Rs.6,92,95,350/-, extra-ordinary items Rs.2,80,89,642/- and dis allowance u/s.40A(2)(b) Rs.41,66,122/-, vide order dated 10.3.2005 passed u/s.143(3) of the Income tax Act, 1961 (the Act). On appeal, the ld. CIT(A) partly allowed the appeal.

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