TaxTMI 
TaxTMI 
2011 (11) TMI 848
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.... they relate to the same assessee, these appeals are disposed off by this consolidated order for the sake of convenience and brevity. 3. The grounds of appeal for both the asst. years are identical. Ground nos. 1 and 7 are general in nature and no specific adjudication is called for and hence, the same are dismissed. 4. Ground Nos.2 to 4 reads as follows:- (2) The learned CIT(A) erred in upholding the order of the AO in reducing the quantum of deduction u/s 10B of the Act in excluding certain items of expenditure incurred outside India by deducting the same from the quantum of export turnover. (3) The learned CIT(A) ought to have appreciated that even if the adjustments as ma....
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....he assessment, reduced the quantum of deduction u/s 10B of the Act by reducing the freight from the export turnover and, at the same time keeping the total turnover at an amount inclusive of freight. The relevant details with reference to the claim of the assessee, the adjustment made by the AO are as follows:- Amount in Rupees Claimed by the assessee Adjusted claim as per AO Variance Export turnover 59,40,30,339 57,14,93,308 2,25,378,031 Total turnover 59,40,30,339 59,40,30,339 -- 10B deduction 25,75,01,180 24,62,32,462 1,12,68,718 6.2 The assessee, being aggrieved, filed appeals before the first appellate authority. 6.3 The first appellate authority confirmed the action of th....
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.... the denominator. The legislature has provided a definition of the expression "export turnover" in Expln.2 to s.10A which the expression is defined to mean the consideration in respect of export by the undertaking of articles, things or computer software received in or brought into India by the assessee in convertible foreign exchange but so as not to include inter alia freight, telecommunication charges or insurance attributable to the delivery of the articles, things or software outside India. Therefore in computing the export turnover the legislature has made a specific exclusion of freight and insurance charges. The submission which has been urged on behalf of the revenue is that while freight and insurance charges are liable to be excl....
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....freight and insurance which does not have any element of profit cannot be included in the total turnover. Freight and insurance charges do not have any element of turnover. For this reason in addition, these two items would have to be excluded from the total turnover particularly in the absence of a legislative prescription to the contrary - CIT v Sudarshan Chemicals Industries Ltd. (2000) 163 CTR (Bom) 596: (2000) 245 ITR 769 (Bom) applied; CIT v Lakshmi Machine Works (2007) 210 CTR (SC) 1: (2007) 290 ITR 667 (SC) and CIT v Catapharma (India) (P) Ltd. (2007) 211 CTR (SC) 83: (2007) 292 ITR 641 (SC) relied on" 6.8 In the case of Sak Soft Ltd. (supra), the assessee was engaged in the business of exporting computer software and claimed ded....
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....ss of manufacture and export of pharmaceutical and neutraceutical products. During the asst. years 2006-07 and 2007-08, the assessee company developed in its plant at Hosur a new product known as "Sucralose". The expenditure incurred in relation to development of this new product was claimed as revenue expenditure. The AO while completing the assessment for asst. years 2006-07 and 2007-08 treated the above said expenses as capital in nature and held that this is for the development of a new product and the said expenditure is not allowable. The amount of product development expenditure added back was Rs. 4,91,13,880/- for asst. year 2006-07 and Rs. 2,35,53,611/- for asst. year 2007-08. 7.1 On further appeal, the view of the AO was affirm....