TaxTMI 
TaxTMI 
2018 (3) TMI 1170
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....nt for disposal of these appeals are as under :- 2.1 The assessee, a 100% Export Oriented Company engaged in the business of development of computer software, filed its return of income for Assessment Year 2010-11 on 12.10.2010 declaring income of Rs. 66,87,400 after claiming deduction of Rs. 36,98,88,272 under Section 10A of the Income Tax Act, 1961 (in short 'the Act'). The case was taken up for scrutiny and the assessment was concluded under Section 143(3) r.w.s. 144C (13) of the Act vide order dt.13.3.2014 wherein the assessee's income was determined at Rs. 14,72,10,830 in view of the Assessing Officer restricting the deduction claimed under Section 10A of the Act to Rs. 13,43,88,005. Book profits under Section 115JB of t....
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....nd in this regard placing reliance on the decision of the Hon'ble Apex Court in the case of CIT Vs. Ravindranath which was rendered in the context of Explanation (baa) to Sec. 80HHC of the Act. It is submitted that the assessee is engaged in the business of development and export of computer software and is a 100% EOU; having no other business. It is contended that when admittedly the aforesaid were claimed by assessee and allowed by the Department in the earlier years as part of the assessee's export business, it was now not open to Revenue, when it is written back, to exclude the same from the assessee's business income for the purpose of computing deduction under Section 10A of the Act on the ground that it has no nexus with ....
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....Act. Therefore, the provision written back and miscellaneous income would comprise part of the assessee's business income and consequently qualify for computing the deduction under Section 10A of the Act. In our considered view, the factual and legal position of the assessee in the case on hand on the issue before us would be supported by the ratio of the decisions of the Full Bench of the Hon'ble Karnataka High Court in the case of CIT Vs. Hewlett Packard Global Soft Ltd. (supra); wherein it has been held that in the case of a 100% EOU, all the profits and gains arising thereof, including incidental income, would be entitled to exemption / deduction under Section 10A of the Act. In this view of the matter, and respectfully followin....
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....exclusion is permitted to arrive at the export turnover only as per the definitions given in Sec. IOA and total turnover has not been defined in the Same. 5. For these and other grounds that may be urged at the time of hearing, it is prayed that the order of the C/T(A) in so far as it relates to the above grounds may be reversed and that of the Assessing Officer may be restored. 6. The appellant craves leave to add, alter, amend and/or delete any Of the grounds mentioned above. 7. Grounds S.Nos.1, 5 & 6. These grounds at S.Nos.1, 5 & 6 (supra), being general in nature, no adjudication is called for thereon. 8. Grounds S.Nos.1 & 3 - Disallowance of payments towards Lease line charges u/s.40(a)(ia) of the Act. 8.....
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.... : "Their Lordships had followed the decision of the Hon'ble Mumbai High Court in the case of Sky Cell (supra), though for different reasons, assessee here had produced bills to show that payments effected thereof for purchasing inter-net band width. We are therefore, of the opinion that assessee was not bound to deduct tax at source under Section 194J of the Act on the payments effected to the service providers. Vis-à-vis application of Sec. 194C, the Assessing Officer was not able to show that the service provided were based on any specific contract entered by the assessee with the service providers. We are therefore, of the opinion that disallowance under Section 40(ia) of the Act was not warranted. Such a di....
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.... the Act is squarely covered in favour of the assessee by the decision of the Hon'ble Karnataka High Court in the case of Tata Elxsi Ltd. (349 ITR 98) which holds the ground and is binding. 9.3 We have heard the rival contentions and have perused and carefully considered the material on record. As regards the issue of reduction of expenditure incurred in foreign currency towards telecom charges as are attributable to the delivery of software outside India, the jurisdictional High Court of Karnataka in the case of Tata Elxsi Ltd. (349 ITR 98) has held that when certain expenses are excluded from the export turnover for the purposes of claiming deduction admissible under the Act, like under Section 10A of the Act, such expenses are als....