TaxTMI 
TaxTMI 
2019 (12) TMI 509
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....V. M/s.Maars Software International Ltd., East Coast Chambers II Floor, 92, G.N.Chetty Road, T.Nagar, Chennai. 2.The relevant portion of the said Judgment is quoted for ready reference: "7. The following substantial question of law (reframed by us) is raised for resolution: 'Whether on the facts and circumstances of the case, the Tribunal was right in holding that unrealised sale proceeds in foreign exchange within the prescribed period amounting to Rs. 2,89,96,894/- had to be included in the total turnover while computing the deduction under Section 10A of the I.T. Act?' 8. Section 10A of the Act is a special provision enacted to provide for a deduction in respect of income derived by an undertaking from the export of articl....
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....mittedly not brought into the country within the prescribed time limit would automatically have to stand excluded from the numerator, i.e. export turnover. However, according to him, the amount constitutes turnover of the assessee and should be included in the denominator, 'total turnover'. He would argue that this treatment was in keeping with the scheme of the section that is intended to provide a benefit only for those engaged in the activity of export and gaining foreign exchange. 13. He points out that the very object of the section is to improve foreign exchange inflows into the Country and thus in a situation where an assessee is unable to bring into the Country foreign exchange by way of export turnover, such non-realisati....
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....ent was not made in the definition of 'total turnover'. In the aforesaid circumstances, the intention of the Legislature was clear to the effect that it would be only sale proceeds actually 'received' that would be included within the ambit of 'export turnover' in the numerator whereas, in addition to actual receipts, what was 'receivable' or 'not actually received' would also stand included within the ambit of denominator i.e, 'total turnover'. 17. This position hinges on the scheme of deduction under section 80HHC, which is specific to the provisions set out therein. The provisions of section 10B do not contain a definition of 'total turnover' and therefore the interpretation of th....
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.... the assessee in convertible foreign exchange in accordance with sub-section (3), but does not include freight, telecommunication charges or insurance attributable to the delivery of the articles or things or computer software outside India or expenses, if any, incurred in foreign exchange in providing the technical services outside India; 21. The issue of whether the items reduced from 'export turnover', such as freight, telecommunication charges or insurance as provided for in the definition would also stand reduced from 'total turnover' was the subject matter of consideration by the Supreme Court in the case of CIT V. HCL Technologies [2018] (404 ITR 719) and the issue was held in favour of the assessee. The conclusion ....
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....low the same principle of interpretation as followed in the case of expenses of freight, telecommunication etc., otherwise the formula of calculation would be futile. Hence, in the same way, expenses incurred in foreign exchange for providing the technical services outside shall be allowed to exclude from the total turnover.' 22. Learned Counsel for the Revenue seeks to distinguish the above judgment stating that the rationale thereof would be applicable only to the items of exclusion at issue before the Supreme Court and cannot be extended to the question of unrealised sale proceeds, which is the issue in the present case. 23. We see no valid distinction as sought to be pointed out before us. The components of the total turnover/de....