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2011 (2) TMI 1415 - AT - Income TaxDeduction u/s 10B - Assessee is engaged in the business of exporting granite - AO observed from the sales invoices that the goods exported are not polished granites, denied the deduction - Assessee was allowed the benefit of section 10B in AY 2005-06, therefore, CIT(A) allowed the deduction HELD THAT:- We are in agreement with the ld. CIT(A) that there is no change in the business of the assessee from earlier years and similar type of export is being done in this year too. Therefore, assessee becomes entitled to deduction u/s 10B under identical facts and circumstances. Deduction u/s 10B - Third Party Exports - Deduction on sales to 100% Export Oriented Undertakings (EOU), where assessee is not exporter itself HELD THAT:- The issue stands covered in favour of the assessee by the decision of DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE-11 (4) , BANGALORE VERSUS INTERNATIONAL STONES INDIA PVT. LTD. [2010 (3) TMI 1106 - ITAT BANGALORE] in which under similar circumstances it has been held that even the third party exports are eligible for the benefit u/s 10B. The third party exports are also considered as export when such exports are made 100% EOU which manufactures the articles or things are received or brought into in convertible foreign exchange, either by the 100% EOU itself or through the third party exporter then such exports amounts to export turnover and are fully eligible for the benefit u/s 10B. The assessee has exported goods through other 100% EOU within a period of six months, thus such sale made by the assessee has to be treated as deemed export. Units registered under 100% EOU Scheme are allowed to sell to another 100% EOU and such sales are known as ‘deemed export’ in trade parlance. The assessee has sold only 20% of the total turnover as ‘deemed export’ to other 100% EOU and evidence regarding realization of foreign exchange, is duly certified by a CA. Thus, the goods in question are manufactured by a 100% EOU (which is the assessee) and goods have been exported out of the country as per the Foreign Trade Policy provisions, for which convertible foreign exchange has been brought into India. Hence, as per the clear provisions stated above, the assessee becomes entitled to deduction under section 10B - Decision in favour of Assessee
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