2016 (12) TMI 1552

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.... Rs. 9,64,64,001/-. In scrutiny assessment the AO determined that the assessee had made only local sales to sister concern M/s Stone world to the tune of Rs. 4,03,66,362/-. It was held that Section 10B deduction available to 100% export oriented undertakings. The assessee's claim rejected on three counts; firstly that the assessee itself never exported the manufactured goods; secondly, M/s Stone world was not status holder or an exporter in terms of the Exim Policy and was not entitled to benefit and therefore the income derived by it could not be treated as assessee's income and thirdly, that the export proceeds were not received by M/s Stone world in the first instance. The CIT (A) accepted the revenue's contentions and rejected the asses....

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....s sub-sections which spelt out the conditions are to be construed liberally rather than a grammatical liberal sense. The court held in the context of facts of the case (since that claim for deduction there was under Section 10A) that: "20. From the aforesaid provisions, it is clear that if a assessee wants to claim the benefit of section10A, firstly he must export articles or things of computer software. Secondly, the said export may be done directly by him or though other exporter after fulfilling the conditions mentioned therein. Thirdly, such an export should yield foreign exchange which should be brought in to the country. If all these three conditions are fulfilled, then the object of enacting Section 10A is fulfilled and the assessee....

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....lable even to a third party but one who facilitates the manufacturer by an exporter from which earnings are reported, (termed as "supporting manufacturer") Section 10B makes no similar provision. It is argued that this ipso fact excluded in its application amounts that could be received or receivable by third party or even status holders, of the kind envisioned in Tata Elxsi Ltd.'s case (supra). This court is of the opinion that such argument too cannot be countenanced. Section 80HHC was undoubtedly brought at a prior point in time - for the first time in 1984. The emphasis of Section 80HHC is the grant of qualify the deduction to business exporters of goods or merchandise. Section 10B so introduced at a later point in time i.e. in 2000 by ....