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TMI Blog2012 (11) TMI 547X X X X Extracts X X X X X X X X Extracts X X X X ..... ign exchange in accordance with subsection( 3), but does not include. (i) freight, telecommunication charges or insurance attributable to the delivery of the articles or things or computer software outside India or (ii) expenses, if any, incurred in foreign exchange in providing the technical services outside India.......". 3. In the course of assessment proceedings, the AO called upon the assessee by letter dated 08-10-2008 to give adjustment towards freight, telecom, insurance, technical services, while computing the deduction u/s 10A of the IT Act. The assessee furnished the following details. "Computation of deduction u/s 10A of the IT Act, 1961 ("The Act") adjustments towards freight/telecom/insurance/technical services As per profit & loss account and schedule K to financial of Global-e-for the year ended March 31, 2005 the following expenditure has been incurred; Particulars Amount as per Profit & loss a/c Schedule K (expend.) incurred in foreign exchange Communication expenses 109,825.384 1,442.242 Travel & conveyance 268.881.615 1,34.317.387 Legal and professional charges 40,364.985 2,040.482 4. In the course of assessment proceedings it was noticed that the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of Infosys Technologies Ltd., Vs DCIT reported in 109 TTJ 631. Relying on the above decision, it was submitted that as the assessee was not engaged in the business of rendering technical services outside India. The foreign travel expenses incurred in foreign currency are not required to be excluded from the export turnover for the purpose of computing the deduction allowable u/s 10A. It was stated that the assessee was in fact engaged in carrying out call centre activities and back office operations and the same does not amount to rendering technical services outside India. It was further submitted that 'computer software' has been defined in Explanation 2(i) of Sec.10A and as per the CBDT's notification No.SO 890(E) dated 26.09.2000, certain IT enabled services have also been notified as coming within the meaning of 'computer software' for the purpose of sec.10A and rendering of technical services outside India, per se, is different and distinct from 'computer software' as per the above definition. It was further submitted that in case the aforesaid sum is to be excluded from the export turnover then, the same should also be excluded from the total turnover and in this regard, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o the interest of the revenue for the reasons stated above is, therefore, set aside aqnd the AO is directed to make a fresh assessment in the light of my observation above, after giving the assessee a reasonable opportunity of being heard". 8. Aggrieved by the order of the CIT, the assessee preferred the present appeal before the Tribunal. 9. We have heard the submissions of the learned counsel for the assessee who submitted that as on the date when the CIT passed the order u/s 263 of the Act namely 30-12-2010 there were decisions rendered by various Benches of the Tribunal taking a view that under clause-(iv) of Explanation-2 to Sec.10A of the Act, expenditure incurred in foreign currency in providing technical services outside India will not cover the case of an assessee engaged in the business of providing software development services. The following decisions were referred to in this regard. Name of the case Citation Date of order Sak Soft Ltd 313 ITR 353(Chen.(SB)(ITAT) March 6,2009 Binary Semantics Ltd 109 TTJ 556(Del.)(HC) March 30,2007 SRA Systems Ltd 305 ITR 27(Che.)(ITAT) June 15,2007 Tata Elxsi Ltd (115 TTJ 423) Bang.ITAT) October 16, 2007 Patni Telecom(P) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jurisdictional or other High Courts, if the jurisdiction of the High Court is a subject matter of appeal before the Supreme Court then the jurisdiction u/s 263 can be invoked. To a query, as to whether any specific appeal has been filed against the various orders cited by the learned counsel for the assessee before the higher forums, the learned DR could not give the required particulars, but however, submitted that exercising jurisdiction u/s 263 was proper. 11. The learned counsel for the assessee in his rejoinder submitted that the Hon'ble Supreme Court in the case of CIT Vs Max India 295 ITR 282(SC) has taken a view that if two views are possible on an issue and the AO has taken one view and by reasons of subsequent retrospective amendment to the law, such view becomes erroneous even than jurisdiction u/s 263 cannot be exercised. 12. We have considered the rival submissions. In our view, the order u/s 263 cannot be sustained. Firstly, we find that in the course of assessment proceedings, the assessee has furnished details regarding communication expenses, travel an conveyance expenses, legal and professional charges in the context of deduction u/s 10A of the Act. In the order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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