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2011 (4) TMI 793 - AT - Income TaxDeduction - Provisions of Explanation (2) to section 10A(3) - The revenue is having objection regarding that the CIT(A) has granted deduction u/s 10A in respect of invoices which has not fallen due and according to the DR, the RBI letter of approval dated 31-7-2003 is applicable only for those invoices for which extension of time had been granted but not for which has not fallen due and it cannot be given exemption for future receivables and work in progress - Held that:the work in progress/future receivables cannot be considered for deduction under section 10A - However, when these amounts on realisation were actually transferred to Wholly Owned Subsidiary as an investment within the extended time by RBI, it is to be considered for exemption u/s 10A if the other conditions are fulfilled by the assessee and similar is the position in case of work in progress - The Assessing Officer has to re-compute deduction u/s 10A considering the work in progress/future receivables as not entitled for exemption under section 10A - The assessee has to reconcile with reference to work in progress realised and transferred it into investment in WOS to avail deduction u/s10A and the Assessing Officer is to grant the deduction u/s 10A, if it is within the extended time - Hence, the revenue appeals are partly allowed.
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