TaxTMI 
TaxTMI 
2015 (4) TMI 754
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....2,47,420/- to domestic and export units in ad hoc manner in 50-50 ratio, in proceedings under Section 143(3) r.w.s. 147 of the Income-tax Act, 1961 (in short 'the Act'). 2. The assessee is a company developing computer software. It is engaged in both export and domestic sales. It had filed its return on 31.03.2001 admitting income of `1,20,322/-. The same was 'summarily' processed resulting in a demand of ` 26,895/-. Thereafter, the Assessing Officer formed an opinion on reasons to believe that the assessee's expenditure written off had to be apportioned between its export and domestic units and failure thereof resulted in escapement of income from being assessed. This culminated in a Section 148 notice dated 31.03.2008. The asse....
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....pment cost written off of Rs. 2,47,420/- at 50-50 ratio is not required. The relevant portion of the assessee's submissions dated 12.08.2014 are as under: The Appellant, Eco Tech Software Pvt Ltd "Eco Tech" or "the Appellant') during AY 200.1-02 in its return of income declared gross total income of ` 4,80,856/" after claiming deduction of lOB unit at Rs. 237,134/- and thereby determined the taxable income at Rs. 243,722/. The assessment was re-opened under 147 for the relevant year and during the assessment proceeding, AO taken one line item expenditure towards Software Development written off of Rs. 247,420/- considered in Export Division, and reallocated 50/50 basic to domestic division and export division. Thereby sought t....
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....total salary cost in the current year. (Amount in Indian Rupees) Description Domestic Division Export Division Total Software Development Turnover 4,021,770 5,554,030 9,575,800 Expenses towards software development salary paid Refer Schedule14 546,474 2,190,220 2,736,694 Expenses towards Software Development -Written off 245,462 - 245,462 From the above table it am be seen that the Appellant has allocated 80.03% of the Salary cost to export division. With the allocation of the 1/7 charged amount the salary cost debited to the export division is 73.44%. From the above table and the figures. It can be seen that the Appellant never had any concealment of income. The Appellant h....
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....nit profit actual Profit of the EOU x Export Turnover of undertaking (Amt.realized in Convertible Foreign currency Total Turnover of the undertaking = 288,180 x 3,197,578 = 1,65,911/- 5,554,030 As detailed above, the assessed income has been overstated to the tune of ` 1,04,974/- this may be taken care while passing order by our honour. The appellant omitted to include the above ground while filing the above appeal. Therefore the appellant request your honour to consider the above as additional ground. I have considered the assessee's submissions carefully. The above software development cost written off pertains to domestic as well as the export di....
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....nbsp; 55,54,030 Net income from export unit after 10B deduction: Rs. 1,22,268/- Therefore, the Assessing Officer is directed to determine the net income from the export division (before allowing deduction u/s.l0B) at Rs. 2,88,180/- as against Rs. 5,33,600/- determined by him in his order. Similarly, the allowable deduction u/s.l0B is to be determined at R.1,65,912j-. as against Rs. 3,08,537/- determined in the assessment order. The Assessing Officer is directed accordingly. In result, the assessee's appeal is treated as partly allowed." 5. We have heard both sides and perused the case file. The assessee challenges apportionment of the impugne....