2013 (8) TMI 1069 - AT - Income Tax

ITAT affirms CIT(A) order on deduction of expenses from turnover, dismisses Revenue's appeal.

The ITAT upheld the CIT(A)'s order directing the reduction of foreign travel expenses, cost of service, and professional charges from total turnover, in ... - Issues involved: Appeal against order reducing expenses from export turnover and total turnover u/s 10A for assessment year 2006-07.Summary:The appeal was filed by the Revenue against the order of the CIT(A)-III, Hyderabad for assessment year 2006-07. The Assessing Officer reduced foreign travel expenses, cost of services, and professional charges from export turnover and recalculated the exemption u/s 10A of the Act. The assessee contended that the expenses were incurred for the export business. The CIT(A) held that these expenses should be reduced from both export turnover and total turnover, following previous decisions. The Revenue appealed, arguing that there was no specific provision for such reduction. The ITAT upheld the CIT(A)'s order, citing precedents that expenses excluded from export turnover should also be excluded from total turnover. The appeal of the Revenue was dismissed accordingly.In conclusion, the ITAT upheld the CIT(A)'s order directing the reduction of foreign travel expenses, cost of service, and professional charges from total turnover, in line with precedents and dismissed the Revenue's appeal.