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TMI Blog2016 (5) TMI 260X X X X Extracts X X X X X X X X Extracts X X X X ..... tal turnover to maintain parity between numerator and denominator while calculating deduction u/s 10A of the Act - I.T. (T.P) A. No. 1303/Bang/2010 - - - Dated:- 27-4-2016 - Shri Vijay Pal Rao, Judicial Member And Shri Inturi Rama Rao, Accountant Member For the Appellant : Shri Keerthi Narayan, C.A. For the Respondent : Shri G.R. Reddy, CIT-I ( D.R ) ORDER Per Shri Vijay Pal Rao, J. M. This appeal by the assessee is directed against the assessment order dt.7.9.2010 passed under Section 143(3) rws 144C in pursuant to the directions of Dispute Resolution Panel ( DRP ) dt.30.08.2010. 2. The assessee has raised the following effective grounds :- Grounds 1. Transfer Pricing : The appellant wishes to state that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubject matter under the Mutual Agreement Procedure ( MAP ) in accordance with the Article 27 of Indo USA DTAA. The learned Authorised Representative has submitted that the parties have accepted the MAP Resolution and therefore the assessee seeks withdrawal of the ground relating to Transfer Pricing Adjustment. In this respect the assessee has filed a letter dt.20.01.2016 explaining that the assessee has received MAP Resolution and the same has been accepted. The learned Departmental Representative has not disputed the MAP Resolution and acceptance of the same by the parties. In view of the fact that there is a MAP Resolution of the transfer pricing issue vide order dt.20.10.2015, the Ground No.1 relating to the issue of Transfer Pricing Adj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erpretation by this Court; ..In section 10A, not only the word total turnover is not defined, there is no clue regarding what is to be excluded while arriving at the total turnover. However, while interpreting the provisions of section 80HHC, the courts have laid down various principles, which are independent of the statutory provisions. There should be uniformity in the ingredients of both the numerator and the denominator of the formula, since otherwise it would produce anomalies or absurd results. Section 10A is a beneficial section which intends to provide incentives to promote exports. In the case of combined business of an assessee, having export business and domestic business, the legislature intended to have a formula to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... same meaning given to the export turnover by the legislature is to be adopted while understanding the meaning of the total turnover, when the total turnover includes export turnover. If what is excluded in computing the export turnover is included while arriving at the total turnover, when the export turnover is a component of total turnover, such an interpretation would run counter to the legislative intent and impermissible. Thus, there is no error committed by the Tribunal in following the judgements rendered in the context of section 80HHC in interpreting section 10A when the principle underlying both these provisions is one and the same . 3.2 The Hon ble Mumbai High Court in the case of CIT Vs. Gem Plus Jewellery India Ltd. 330 IT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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 excluded in computing export turnover, a similar exclusion has not been provided in regard to total turnover. The submission of the revenue, however, misses the point that the expression total turnover has not been defined at all by Parliament for the purposes of s.10A. However, the expression export turnover has been defined. The definition of export turnover excludes freight and insurance. Since export turnover has been defined by Parliament and there is a specific exclusion of freight and insurance, the expression export turnover cannot have a different meaning when it forms a constituen ..... X X X X Extracts X X X X X X X X Extracts X X X X
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