2020 (4) TMI 481

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....duction u/s 80JJA of the Act. (b) Disallowance made u/s 14A of the Act. (c) Disallowance of provision for mark to market loss on derivatives. 2. The assessee herein has expertise in consulting, architecture, package implementation, application engineering, testing, infrastructure management, IT process optimization and audit. The assessee has established a unit in Special Economic Zone and the same is engaged in development of software, provision of geographical information and export of these services. The assessee has claimed deduction u/s 10JA of the Act. The assessee has also claimed deduction u/s 80JJAA of the Act. 3. The first issue relates to disallowance of deduction claimed u/s 80JJA of the Act. The Assessin....

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.....)], wherein the Tribunal has taken the view that the software professional could be considered as workmen as per the provisions of section 80JJAA of the Act. The learned AR further submitted that the provisions of section 80JJAA of the Act has been amended by substituting the words "industrial undertaking" by the word "factory" subsequent to assessment year 2012-2013. The learned AR submitted that the co-ordinate Bench in the case of Manhattan Associates (India) Development Centre (P.) Ltd. (supra), has examined the eligibility of salary paid to Software Engineers for deduction u/s 80JJAA of the Act for the assessment year 2012-2013 and has held that the salary so paid is eligible for deduction u/s 80JJAA of the Act. In view of the decisio....

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.... that the investment made by the assessee included investments made in foreign subsidiary companies also. The dividend income earned from the foreign subsidiary companies is not exempt u/s 10(38) of the Act. Accordingly, he submitted that while calculating average value of investments, the investments made in foreign subsidiary should be excluded. 9. We heard the learned DR and perused the record. We find force in the submission made by the learned AR. As per the decision rendered by Delhi Special Bench of the Tribunal in the case of Vireet Investments Ltd, only those investments which have yielded exempt income should be considered for computing the average value of investment. In view of the above, we direct the A.O. to re-compute t....