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TMI Blog2007 (1) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... included in the indirect cost - I.T. A. Nos. 540 and 1702 of 2006 - - - Dated:- 9-1-2007 - JUDGMENT 1. The Revenue is aggrieved by an order dated July 6, 2005 passed by the Income Tax Appellate Tribunal, Delhi Bench 'C' in ITA No.3334/Del/2001 relevant for the assessment year 1998-99. 2. The controversy in this case is whether freight charges said to have been incurred by the Asses ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avour. The learned Tribunal upheld the view of the CIT (A) and that is how the matter is before us in an appeal under Section 260A of the Act. 5. There is no doubt about the fact that the amount of Rs.30,95,158/- expended by the Assessee towards shipment freight was recovered from the foreign buyer and the amount so recovered was deducted by the Assessee from its total turnover for the purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s : "(b) 'export turnover' means the sale proceeds, received in, or brought into, India by the assessee in convertible foreign exchange in accordance with clause (a) of sub-section (2) of any goods or merchandise to which this section applies and which are exported out of India, but does not include freight or insurance attributable to the transport of the goods or merchandise beyond the customs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Revenue is that shipment freight forms a part of the indirect cost. "Indirect costs" has been defined in the Explanation to sub-section (3) of Section 80 HHC of the Act as follows: "Explanation. - For the purposes of this sub-section - (e) 'indirect costs' means costs, not being direct costs, allocated in the ratio of the export turnover in respect of trading goods to the total tur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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