TaxTMI 
TaxTMI 
2016 (2) TMI 193
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....1 for claiming the deduction are not fulfilled." 2. The relevant facts for the issue under consideration, are as follows: 2.1 During the assessment proceedings, it was observed by AO that assessee firm made re-export of imported goods amounting to Rs. 65,35,59,139/- and declared net profit of Rs. 7,32,19,235/- which have been claimed as deduction u/s 10AA of the IT At, 1961, in respect of one of the units of the assessee firm which was situated in SEZ Surat (Gujarat). 2.2 As per AO, the assessee has claimed deduction u/s 10AA on purely trading activity i.e. import of diamonds and re-export of the same without any manufacturing or processing or providing any services. The assessee during assessment proceedings submitted that deduction u/s ....
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.... defining services. In view of the same, it is clear that IT Act, 1961 has clearly excluded definition of services given in SEZ Act from its preview.. Income Tax Act, 1961 has already referred to SEZ Act for definition of manufacturing & therefore section 29) of SEZ ct 2005 has been reproduced in appendix of UIT Act. However, same is not the case with section 2(z0 of SEZ Act, 2005. (ii) Definition for providing any service does not include trading for the purpose of sec. 10AA(1) of the I.T. Act, otherwise the section should have been simply stipulated business activity instead of using manufacture/produce of article/thing or providing any services. (iii) The meaning of providing service does not include trading as per the Oxford English....
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....rvices provided the trading is export of imported goods. We therefore, feel that the assessee is entitled to deduction u/s 10AA of the Act and therefore, the ld. CIT(A) was justified in allowing the exemption. Thus it is seen that the matter is covered by the finding of the Hon'bleITAT Jaipur Bench in the case of M/s Goenka Diamond & Jewellers Lt. supra in favour of the assessee. Since the AO has not brought any evidence or argument or case law to controvert the finding of the Hon'ble ITAT Jaipur Bench in the same facts it is held that the matter of claiming of exemption u/s 10AA is covered by this finding and the appellant is allowed to claim exemption of Rs. 6,71,89,986/- u/s 10AA. 2.6 During the course of hearing the Ld. AR relies o....
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....ied that trading units can be set up in the SEZ. However, the modification was made on 2.05.2006 in which it was made clear that the deduction u/s 10AA will be available in reset of the trading in the nature of re-export of imported good. Thus the assessee were promised that they will be eligible for deduction u/s 10AA of the Act in respect of the profit earning on trading of re-export of imported goods. The revenue has not been able to show us that such instruction was not withdrawn or the Board has issued instruction that instruction dated 24.05.2006 from the Ministry of Commerce will not be applicable for the purpose of allowing exemption u/s 10AA of the Act. Hence the view of doctrine of promissory estopped, we hold that the assessee is....