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2014 (3) TMI 357 - AT - Income TaxExclusion of the amount of internet expenses from export turnover as well as total turnover – Held that:- The Assessing Officer has excluded an amount of Rs. 11,23,288/- being internet expenses for export of software from export turnover without excluding the same from total turnover - The Decision in ITO Vs. M/s. Saksoft Ltd [2009 (3) TMI 243 - ITAT MADRAS-D] followed - the eligible expenditure has to be excluded from export turnover as well as total turnover – thus, the expenditure incurred on account of the internet expenses for export of software is to be excluded from export turnover as well as total turnover – Decided in favour of Assessee. Dis-allowance u/s.10A of the Act – splitting up or/and re-construction of the business activities already in existence – Held that:- The assessee has not been formed by splitting up of the existing business or re-construction of the business at a new place by splitting up of existing business - Decided in favour of the assessee. Method of computation of deduction u/s.10A of the Act – Deduction claimed before setting off of unabsorbed depreciation and brought forward losses – Held that:- For un-absorbed depreciation,the decision in M/s.Himatsingka Seide Ltd., Vs. CIT [2013 (10) TMI 823 - SUPREME COURT] followed - un-absorbed depreciation has to be set-off before computing the exemption allowable u/s.10A – for setting-off of the brought forward losses, the decision in CIT Vs. Yokogawa India Ltd. 2011 (8) TMI 845 - Karnataka High Court] followed – thus, the assessee can claim deduction u/s.10A before setting off of brought forward losses – Decided partly in favour of Assessee. Upward adjustment made by DRP - Difference in PLI of the assessee viz-a-viz PLI of comparables – Held that:- The decision in Assistant Commissioner of Income-tax Versus SRA Systems Ltd. [2013 (9) TMI 334 - ITAT CHENNAI] followed - the PLI of the assessee is determined at 7% - While determining the PLI for the AY.2007-08, the Tribunal had also taken into consideration the directions of the DRP for the AY.2008-09 – thus, it would be appropriate to adopt the PLI at 7% as against 13.35% determined by the DRP - the quantum of ALP has to be re-calculated in accordance with the PLI – Decided partly in favour of Assessee. Value of operating cost – Held that:- There is a factual error which is to be rectified after referring to the books of accounts of the assessee – thus, the matter remitted back to the Ao foe adoption of the correct value of operating cost – Decided in favour of Assessee.
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