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TMI Blog2015 (1) TMI 875X X X X Extracts X X X X X X X X Extracts X X X X ..... e, by virtue of sub Section (4) it is deemed to be the profits of the business of the undertaking for the purpose of extending the benefit of exemption of payment of tax under Section 10A of the Act to a newly established undertaking in a free trade zone. In that view of the matter, the order passed by the Tribunal is un-sustainable and contrary to law. - Decided in favour of the assessee. X X X X Extracts X X X X X X X X Extracts X X X X ..... asseessee is not the owner of the property in question. The rent income cannot be assessed as business income as there is no direct nexus between the assessee's software development business and the industrial undertaking with the payment of rent. Therefore, dismissing the appeal, the tribunal affirmed the finding of the assessing authority and the appellate authority. Aggrieved by the said order, the assessee is in appeal. 4. The substantial question of law that arises for our consideration in this appeal is as under:- 1. Whether on the facts and in the circumstances of the case, the Honourable Tribunal was right in law in holding that the rental from temporary sublease of office premises cannot be regarded as "part of the prof ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rities were justified in not extending the benefit. 7. Section 10A (1) and (4) reads as under:- "10A. Subject to the provisions of this section, a deduction of such profits and gains as are derived by an undertaking from the export of articles or things or computer software for a period of ten consecutive assessment years beginning with the assessment year relevant to the previous year in which the undertaking begins to manufacture or produce such articles or things or computer software, as the case may be, shall be allowed from the total income of the assessee. (4) For the purposes of sub-sections (1) and (1A), the profits derived from export of articles or things or computer software shall be the amount which bears to the profit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the relevant period. Assessee is not the owner of the said premises. Assessee is carrying on the business of development of Software in Canada. The said premises was taken for the aforesaid business purpose. As a portion of the said premises was not used for business purpose, instead of keeping it vacant and suffering loss, it was rented out. Therefore, the said income derived from lease of the said premises constitutes "income from business". Neither it would be 'income from house property' nor 'income from other sources'. In view of the explanation used in sub Section (4) of Section 10A of the Act for the purpose of Sub section 1, the profit derived from export of articles or things or computer software shall ..... X X X X Extracts X X X X X X X X Extracts X X X X
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