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TMI Blog2008 (9) TMI 951X X X X Extracts X X X X X X X X Extracts X X X X ..... export turnover. This Bench in the case of M/s. Relq Software Pvt Ltd [ 2008 (5) TMI 372 - ITAT BANGALORE-A] also held that the on-site expenses for development of computer software is not in the nature of technical services. Applying the same, we confirm the order of the ld CIT (A) granting relief to the assessee treating expenses incurred in foreign currency to be taken along with total turnover of the assessee. It is ordered accordingly. In the result, the appeal filed by the revenue is dismissed. X X X X Extracts X X X X X X X X Extracts X X X X ..... n first appeal, the learned CIT (A), considering the facts of the case observed and held as under: "I have gone through the facts and circumstances of the case, assessment records, appellant's submissions, remand reports, etc. Factually the appellant has disclosed its business as one of software development and services. This fact is also found to have been accepted by the AO as mentioned in the face of the assessment order. The appellant clarified that the business was held to be development, service and sale of computer software even in the earlier years. In the assessment order there is no dispute as to nature of business carried on by the appellant. The dispute was only on the exclusion of expenditure incurred in foreign curr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quently, export turnover in this case shall be taken at ₹ 332,67,32,756/- and accordingly relief u/s 10A shall be allowed, the AO is directed to do so". Aggrieved, revenue is in appeal before this Tribunal. At the time of hearing, learned counsel for the assessee pointed out that this issue is also squarely covered by the decision of this Tribunal in the case of the assessee for assessment years 2001-02 and 2002-03. He had filed copy of the aforesaid order dated 30-5-2008. The facts are similar as in those assessment years. The Tribunal, in paragraphs 24.3, 24.4, 24.5 and 24.6 held as under: "24.3 Before us, the learned DR drew our attention to explanation 2(iv) of section 10A. As per this definition, export turnover means ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dated 16th May, 2008 has also held that the on-site expenses for development of computer software is not in the nature of technical services. It will be useful to reproduce para 14 and 15 from that order:- "14. During the course of proceedings before us, the learned AR submitted that the issue stands decided in favour of the assessee by the Tribunal in the case of: 1. ACIT vs M/c Infosys Ltd. 653 and 969(B)/2006 2. M/s. Tata Elxsi Ltd. 315(B)/2006 order dated 16.10.2007 3. M/s. I-Gate Global Solutions Ltd. vs ACIT (Supra) 15. We have heard both the parties. Deduction u/s 10A is available in respect of profit or gains derived from an undertaking form the export of articles or things or computer software. One has to understand the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h relates to goods. Hence, the AO is not justified in excluding ₹ 4,86,63,187/- from export turnover". 24.6 The Hyderabad Bench in the case of Patni Telecom P. Ltd. v ITO vide order dated 11th January, 2008 in ITA No.5/Hyd/2005 and 354/Hyd/2006 held that expenditure incurred on travel and allowances for the purpose of development of software at clients site outside India cannot be excluded from the export turnover. Similar finding has been given by Chennai Bench vide order dated 15th February, 2008 in ITA No.731/Mad in the case of Changepond Technologies P. Ltd. v ACIT wherein it has been held that expenses on salaries, traveling and other perquisites are to be included in the export turnover. Hence following the decision of thi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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