2016 (4) TMI 255

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....acts and circumstances of the case, the learned Income Tax Appellate Tribunal has erred in law and on facts in holding that the respondent assessee had established a new 100% Export Oriented Undertaking eligible for exemption u/s 10B of the Income Tax Act and not SEZ Unit?" 2. The assessment year is 2010-11 and the relevant accounting period is the previous year 2009-10. The assessee, which is assessed in the status of a firm, develops software for foreign clients. The assessee filed its return of income on 17.09.2010 declaring a total income of Rs. 68,692/- after claiming deduction of Rs. 44,53,725/- under section 10B of the Act. The assessee's turnover in the relevant previous year was Rs. 1,11,92,263/- with net profits of Rs. 45,20,....

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.... view that a 'Unit' under SEZ does not contain the same meaning as an 'undertaking' envisaged in section 10B of the Act. Further as per clause (zc) of section 2 of the Special Economic Zones Act, 2005, a 'Unit' means a unit set up by an entrepreneur in a Special Economic Zone and includes an existing unit, and Offshore Banking Unit and a Unit in an International Financial Services Centre. He, accordingly, was of the view that the assessee's Unit is located at Ahmedabad, outside the defined SEZ and hence the assessee was not eligible for any deduction under section 10B of the Act. He, accordingly, set aside the assessment made by the Assessing Officer for being framed de novo. The assessee carried the matter in ap....

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....004-09 for establishment of a new Undertaking at the address mentioned therein. That the paper book further revealed that the relevant stipulations are also incorporated therein that section 10B relief would be subject to interpretation of its manufacturing activities. The Tribunal found that the Development Commissioner, Kandla SEZ had approved the assessee as a 100% Export Oriented Undertaking and not a SEZ Unit as interpreted by the Commissioner of Income Tax and was of the view that the said finding also takes care of Commissioner of Income Tax's observation that an SEZ Unit cannot be held eligible for section 10B deduction being established outside the defined SEZ. The Tribunal placed reliance upon the decision of the Delhi High Co....