9911796707
TMI Blog2021 (1) TMI 168X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee does not determine the exchange value of the Indian Rupee. It has to be remembered but for the fact that the assessee is an expot house, there was no question of earning any foreign exchange. Therefore, when the fluctuation in foreign exchange rate was solely relatable to the export business of the assessee and the higher Rupee value was earned by virtue of such exports carried out by the assessee, there is no reason why the benefit of Section 10(A) should not be allowed to the assessee. Foreign Currency Expenditure and Communication Charges - HELD THAT:- The same are covered by a decision of this Court in CIT v. M/s. Zylog Systems Limited [ 2020 (3) TMI 181 - MADRAS HIGH COURT ] wherein, it was held that such expenditure incurred by the Assessee in foreign currency will also be includible in the definition of export turnover for the purpose of computing deduction under Section 10B of the Act. Set off of brought forward losses before allowing tax holiday deduction is covered by the decision in CIT v. M/s. Yokogawa India Ltd. [ 2016 (12) TMI 881 - SUPREME COURT ] - From a reading of the relevant provisions of Section 10A it is more than clear to us that the deductions con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... osses before allowing tax holdiay deduction TCA No.86 of 2017 (SQL 3) Covered in favour of the Assessee by the order of the Supreme Court in the case of Yokogawa India Ltd. and the order of this Hon'ble High Court in TCA No.228 of 2011 in the case of M/s. Comstar and TCA No.115 of 2016 in the case of M/s. Visual Graphics 4. The questions of law raised in all the appeals are quoted below: TCA No.83 of 2017 - Assessment Year 2002-03 (1) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the deduction under Section 10A in respect of provisions written back are to be allowed? (2) Is not the finding of the Tribunal bad since provisions written back included in the claim for deduction under Section 10A was not derived by an undertaking from the export of article or thing or computer software? (3) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the gain on foreign exchange fluctuation is eligible for deduction under Section 10A even though the said gain nothing to do with the realized income from the eligible undertaking and was a result of restatement of outstanding balances on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... diture incurred in foreign exchange in providing technical services outside India has to be reduced from the export turnover only and not from the total turnover? (3) Whether the Tribunal was right in holding that the benefit of deduction under Section 10A could be allowed before setting off of brought forward losses? 5. The relevant extract of the judgments by which the aforesaid issues and questions are covered are also quoted below for ready reference. 6. As regards substantial questions of law relating to deduction under Section 10A in respect of provisions written back towards link charges and annual day expenses and the said claim was not derived by an undertaking from the export of article or thing or computer software, the same is covered by the decision of this Court in M/s. California Software Co. Ltd. v. The Commissioner of Income Tax [(2020) TaxCorp (DT) 82481 (HC-Madras), wherein, reliance was placed on the decisions in Camiceria Apparels India Pvt. Ltd. v. ACIT [TCA Nos.1972 & 1973 of 2008] and CIT v. Hewlett Packard Global Soft Ltd. [(2017) 87 Taxmann.com 182(Kar.)(FB), the relevant portion of which reads as under: "5. In view of the aforesaid two preceden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... necessarily involving deduction of the profits arising out of domestic sales, is one instance of deduction provided by the amendment. Profits of an eligible unit pertaining to domestic sales would have to enter into the computation under the head "profits and gains from business" in Chapter IV and denied the benefit of deduction. The provisions of Sub-section (6) of Section 10A, as amended by the Finance Act of 2003, granting the benefit of adjustment of losses and unabsorbed depreciation etc. commencing from the year 2001-02 on completion of the period of tax holiday also virtually works as a deduction which has to be worked out at a future point of time, namely, after the expiry of period of tax holiday. The absence of any reference to deduction under Section 10A in Chapter VI of the Act can be understand by acknowledging that any such reference or mention would have been a repetition of what has already been provided in Section 10A. The provisions of Sections 80HHC and 80HHE of the Act providing for somewhat similar deductions would be wholly irrelevant and redundant if deductions under Section 10A were to be made at the stage of operation of Chapter VI of the Act. The retentio ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
