COMMON JUDGMENT

THE CHIEF JUSTICE

Impugning the common order dated 30.9.2015 passed by the Income Tax Appellate Tribunal [ITAT], the assessee has filed these appeals pertaining to assessment years 2003-2004 and 2004-2005, which have been admitted on the following substantial questions of law:

T.C.A.No.277 of 2016:

"(i) Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the losses of the software technology park units of the appellant cannot be set off against the income from other units in arriving at total income?

(ii) Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that amounts paid by the appellant to M/s.Sprint USA, for International Private Leased Circuits (IPLC) is to be disallowed under Section 40(a)(i) of the Act?

(iii) Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that amounts paid by the appellant to M/s.Sprint USA, for International Private Leased Circuits (IPLC) is 'royalty' under Section 9 of the Act read with the Double Taxation Avoidance Agreement between India and United States of America?

(iv) Whether under the facts and circumstances of the case, the amounts paid by the appellant to M/s.Sprint USA towards IPLC should be subject to deduction of tax at source considering the non discrimination Article of the Double Taxation Avoidance Agreement between India and United States of America? and

(v) Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal has erred in not adjudicating the ground of appeal raised by the appellant with respect to claim of tax holiday deduction under Section 10A/10B on miscellaneous income?"

TCA No.278 of 2016:

(i) Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that amounts paid by the appellant to M/s.Sprint USA, for International Private Leased Circuits (IPLC) is to be disallowed under Section 40(a)(i) of the Act?

(ii) Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that amounts paid by the appellant to M/s.Sprint USA, for International Private Leased Circuits (IPLC) is 'royalty' under Section 9 of the Act read with the Double Taxation Avoidance Agreement between India and United States of America? And

(iii) Whether under the facts and circumstances of the case, the amounts paid by the appellant to M/s.Sprint USA towards IPLC should be subject to deduction of tax at source considering the non discrimination Article of the Double Taxation Avoidance Agreement between India and United States of America?

T.C.A.No.279 of 2016

Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the appellant is liable for interest under Section 234D of the Act?

T.C.A.No.280 of 2016:

Whether under the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in holding that the losses of the software technology park units of the appellant cannot be set off against the income from other units in arriving at total income?

2. It behooves us to give a recount of the factual matrix that propelled the assessee to file these appeals.

2.1. The assessee is a company engaged in the business of software development and export. The return filed by the assessee was processed under Section 143(1) of the Income-tax Act, 1961 [the Act] and, subsequently, selected for scrutiny by issue of notice under Section 143(2) of the Act. The Assessing Officer completed the assessment of income of the assessee under Section 143(3) of the Act for the assessment years 2003-2004 and 2004-2005 vide orders dated 28.2.2006 and 18.12.2006, respectively, thereby denying the claim of the assessee for set off of current year losses of assessee’s Pune, Chennai I and Kolkata II units for the assessment years 2003-2004 and that of the Ban