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2014 (7) TMI 751 - AT - Income TaxApplication of section 10B(7) r.w. section 80IA(10) - claiming excess exemption by showing higher profit - AO concluded that by taking the services of employees of the sister concern, the assessee had shown more than ordinary profits. - Held that:- For applying the provisions of section 10B(7) r.w.s 80IA(10), AO has first to show that cost of hiring employees by the assessee had resulted into more than ordinary profit - This could happen only if the assessee had paid less than the market value to the sister concern on account of hired employees - There is no material on record to show that sister concern had hired the employees at less than market price because only in that case it could be said that the assessee had paid less than the market price - it cannot be said that assessee had produced more than the ordinary profit because of close connection with the sister concern or that it had declared more profit in order to claim more exemption – thus, the order of the CIT(A) is set aside – Decided in favour of Assessee.
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