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2016 (1) TMI 1334 - AT - Income TaxComputing deduction under section 10A - Held that:- We find that the Hon’ble High Court of Karnataka in the case of Tata EIxsi Ltd (2011 (8) TMI 782 - KARNATAKA HIGH COURT) has held that while computing deduction under section 10A expenditure incurred by the assessee, if excluded from the export turnover (“ET”), should also be excluded from the total turnover (“TT”). TDS u/s 195 - whether he payment in question was reimbursement and therefore there was no obligation to deduct tax at source on the part of the Assessee? - Held that:- In our view it would be unnecessary to go into the question whether the payment in question is reimbursement of expenses or in the nature of FTS or the question whether the services rendered made available technology to the Assessee in terms of Article 12(4) of the India USA DTAA, because even assuming the sum in question is to be disallowed u/s.40(a)(ia) of the Act, the disallowance will only go to enhance the profits derived by the Assessee from the business of export of computer software and on such enhanced profits deduction u/s.10A of the Act has to be allowed, thereby rendering tax implication on the Assessee insignificant. As rightly contended on behalf of the Assessee the consequence of disallowance u/s.40(a)(ia) of the Act will be that the business profits of the Assessee to that extent will stand enhanced. - Decided against revenue
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