2017 (9) TMI 1889

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....als, we heard these appeals together and disposing of the same by this common order. 2. Shri G. Baskar, the Ld.counsel for the assessee, submitted that the assessee claimed deduction under Section 10B of the Income-tax Act, 1961 (in short 'the Act'). According to the Ld. counsel, the assessee is a 100% Export Oriented Unit. The assessee exported valves and also earned management fee which was incidental to the export of valves. According to the Ld. counsel, the assessee claimed before the Assessing Officer that management fee partakes the character of profits and gains from business or profession. The Assessing Officer however, rejected the claim of the assessee and found that the management fee, sale of scrap and interest are not ....

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.... Ld.counsel submitted that the management fee of Rs. 56,52,503/- and Rs. 56,13,961/- for the assessment years 2009-10 and 2010-11 respectively are in the nature of rendering technical services in connection with export of valves from India, therefore, the assessee explained before the Assessing Officer that it has to be treated as profits and gains from business. 4. On the contrary, Shri Asish Tripathy, the Ld. Departmental Representative, submitted that the profit derived by the undertaking from export of article or thing alone is eligible for deduction under Section 10B of the Act. In this case, the management fee was not derived from the business of export. Therefore, according to the Ld. D.R., the Assessing Officer, by placing reliance....

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....e for deduction under Section 10B of the Act in respect of export drawback, customer claims, freight subsidy and interest on fixed deposit receipts. The Delhi Bench of this Tribunal allowed the claim of the assessee holding that export drawback forms part of income eligible for deduction under Section 10B of the Act. As regards other three claims, viz. customer claims, freight subsidy and interest on FDRs, this Tribunal found that it cannot form part of income eligible for deduction under Section 10B of the Act. On further appeal before the Delhi High Court, the Delhi High Court after considering the judgment of Apex Court in Pandian Chemicals Ltd. (supra) and Sterling Foods (supra), found that freight subsidy, customer claims and interest ....