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2012 (12) TMI 562 - AT - Income TaxNature of service in order to calculate export turnover u/s 10B - Whether the expenses incurred in foreign currency on onsite software development outside India was to be excluded from export turnover – Assessee contended that it was not rendering any technical services outside India to any third party, but the foreign currency expenses incurred were in connection with its own staff in foreign branch in foreign country - Held that:- Since the fact of the case was not similar as quoted by assessee in his favour. Therefore, admittedly these were related to technical services rendered outside India. Hence decides in favour of revenue Assessee has not raise separate billing for such expense to its clients – Held that:- Once expenses of the nature mentioned in clause (iii) of Explanation 2 to Sec. 10B are incurred, these will have to be excluded from export turnover, whether or not billings of the assessee specifically mentioned such items. Even if such expenses other than on technical services, are incurred in India, it still has to be excluded from export turnover. Appeal decides in favour of revenue & remand back to AO Exclusion of expense from total turnover calculated in relation to Sec. 10B – Held that:- The items which were excluded by the AO from export turnover by relying on clause (iii) of Explanation 2 to Sec 10B, will have to be excluded from total turnover also for the purpose of computing deduction u/s 10B. Issue decides in favour of assessee & remand back to AO
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