2016 (11) TMI 1484

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....he Act') in relation to the assessment year 2011-12. 2. First ground is general which does not require any adjudication. 3. Ground no. 2 about the transfer pricing adjustment amounting to Rs. 29.90 crore in the 'Software development service segment' and ground no. 3 about the transfer pricing adjustment amounting to Rs. 9.30 crore in 'I.T. enabled service segment' were not pressed by the ld. AR. The same, therefore, stand dismissed. 4. Ground nos. 4 and 6 are against the disallowance u/s 40(a)(i) of the Act of expenditure amounting to Rs. 21,32,49,648/- incurred by the assessee as Management services fees on the reason that the assessee failed to deduct tax at source in terms of section 195 of the Act. 5. Briefly stated, the fac....

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....nion that the ends of justice would meet adequately if the impugned order on this issue is set aside and the matter is restored to the file of AO. We order accordingly and direct him to decide this issue afresh in consonance with the judgment of the Hon'ble Delhi High Court passed in the assessee's own case. 7. Ground no. 5 is against reducing the deduction u/s 10A from Rs. 34,79,66,065/- as claimed by the assessee to Rs. 20,31,60,680/- inter alia, by excluding the following three items from 'Export turnover' alone:- Telecommunication charges Rs. 2,70,431 Subsistence for onsite employees Rs. 1,43,16,518 Standby and callout charges Rs. 4,87,48,607 Total Rs. 6,33,35,556 8. Succinctly, the facts of this issue are ....

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....he Delhi Bench of the Tribunal in assessee's own case for the A.Y. 2009-10, a copy of which order is available on record. Respectfully following the precedent, we direct that the total of the above referred three expenses be simultaneously excluded from the amount of 'Total turnover' as well. 10. Ground no. 7 is against excluding proportionate amount of interest income from the total profits in the re-computation of deduction u/s 10A of the Act. The facts of this ground are that the AO in recomputing the amount of deduction u/s 10A observed that the assessee earned interest income amounting to Rs. 31,49,15,229/- which was rightly offered as 'Income from other sources'. Out of this interest income, only a sum of Rs. 91,375/- was shown aga....

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....unting to Rs. 3,15,059/- (figure in Rs. 000). Thus, it is clear that the amount of interest from bank totaling to Rs. 31.49 crore and odd forms part of 'Profit before tax', which is the starting point of Computation of taxable income at page 3 of the paper book. In such a computation of total income, the assessee has excluded total interest income of Rs. 31,49,15,229/- from the amount of profit before tax as per P&L Account to work out the income under the head 'Profit and gains from business or profession' at Rs. 84,18,14,748. Interest income of Rs. 31.49 crore has been separately shown under the head 'Income from other sources' for computing gross total income of Rs. 80.87 crore. This shows that the interest income of Rs. 31.49 crore has ....

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....he business profits for the purpose of deduction u/s 10A. When the interest income allocated by the AO at Rs. 8.03 crore and odd does not form part of the total business profits amounting to Rs. 34.79 crore, there can be no question of reducing it further by the amount of allocated interest. 13. The assessee furnished a calculation at the instance of the AO to bring home its point that no further reduction was warranted from the book profits in the computation of deduction u/s 10A, whose copy has been placed in the paper book. It can be noticed that in computing the Income under the head 'Profit and gains of business or profession' (before/after apportionment of interest income to the Noida Unit-IV), the assessee started with Profit befo....