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2019 (3) TMI 1156 - AT - Income TaxEligibility of claim of deduction u/s 10B - eligibility of alternative claim u/s 10A - assessee is a 100% Export Oriented Unit (EOU) - AO denied the claim on the ground that it is not a 100% EOU as defined in section 10B, since approval under the STPI scheme cannot be considered sufficient for granting the benefits of section 10B - HELD THAT:- Referring to judgment of REGENCY CREATIONS LTD., VALIANT COMMUNICATIONS LTD. [2012 (9) TMI 627 - DELHI HIGH COURT] approval as 100 per cent Export Oriented Undertaking under Software Technology Park of India (STPI) scheme cannot be considered sufficient for granting benefit of section 10B of the Income Tax Act.1961. The facts of the case in above decision of the Hon’ble Delhi High Court apply squarely in this case. Accordingly, the assessee, not being approved by the Board appointed by the Central Government in exercise of powers conferred u/s 14 of the Industries (Development and Regulation) Act, 1951, is not eligible for exemption u/s 10B of the I.T.Act. Alternative claim of deduction u/s 10A - Assessee had made a claim by furnishing a certificate in Form No.56F before the assessment order was finalized - HELD THAT:- To claim deduction u/s 10A the assessee is required to file audit report in Form No.56F. Even if the certificate as required u/s 10A was not filed along with the return of income, the provision regarding filing of audit report is only directory and not mandatory and the audit report can be filed during the course of assessment proceedings. In the instant case, the audit report was filed in the course of assessment proceedings and there is no error in granting deduction u/s 10A We are of the view that the assessee is not entitled to deduction u/s 10B of the I.T.Act, whereas, the alternative claim of deduction u/s 10A of the I.T.Act, the claim should be granted to the assessee provided that necessary pre-condition for satisfaction of the same are qualified in assessee’s case - Decided partly in favour of assessee.
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