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2012 (10) TMI 510 - AT - Income TaxDeduction u/s 10B Domestic sale of scrap - Total export turnover was 99.68 % of the total turnover - Domestic sales of scrap was 0.32 % of the total turnover AO argued that proceeds of scrap sales are not realized in convertible foreign exchange as per Sec. 10(3) Held that:- The domestic turnover was less than 25 % of the total sales of the assessee and therefore, the conditions of the second proviso to sub- section (1) of section 10B are fully satisfied. Therefore, respectfully following the decision of the Hon'ble Jurisdictional High Court in the case of Savvy Systems (India) Limited. (2006 (11) TMI 154 - MADRAS HIGH COURT), that assessee entitled for deduction u/s 10B. In favour of assessee Deduction u/s 10B Sale of scrap - Whether sale proceeds of scrap could be reduced from the eligible profits u/s 10B AO reduced the receipt from scrap sales from the business profits and treated it as income from other sources - Held that:- As the sale of scrap is part and parcel of the business receipt of the assessee. That being so, it has to be included in the total turnover of the assessee and cannot be reduced from the business profits of the assessee while computing the deduction u/s 10B. Issue in favour of assessee
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