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2014 (11) TMI 596 - HC - Income TaxEntitlement for deduction u/s 10A – Profits attributable to export turnover - Whether the Tribunal was right in holding that the assessee company was entitled to deduction u/s 10A in respect of the profits attributable to the export turnover for the entire previous year relevant to the AY 2000-01 even though registration from the Software Technology Parks of India (STPI), as an STPI unit was obtained only on 04.03.2000 and the AO was not correct in restricting the deduction to the export profits relating to the turnover of the period after the date of registration as certified by the STPI – Held that:- The assessee Soffia Software Limited has been notified on 04.03.2000 and the assessee has commenced its software production during the previous year related to the Assessment Year - From the date of notification, the assessee would be entitled to the benefit of Sec.10A if other conditions have been fulfilled - in Section 10A, nowhere there is a restriction provided that deduction may be applicable only after registration with STPI or only for the amounts earned after such registration. If the assessee has to derive the benefits of the special provisions of Sec.10A, the assessee has begun or begins to manufacture or produce articles or things during the previous year relevant to the assessment year in the STPI Unit and it will be entitled to deduction under Sec.10A in respect of profits attributed to export turn over – the Tribunal was rightly of the view that the Circular issued under Section 10B cannot be made applicable to the case falling under sec.10A - There is a clear distinction between the establishment of Sec.10A and the special provisions of Sec.10B of the Act which defines 100% Export Oriented Undertakings - There is no scope for drawing inference from the provisions of Sec.10B as the assessee satisfies the requirement of Sec.10A, it will be entitled to such benefit - the AO has restricted the deduction based on an artificial cut off date (i.e.) 4.3.2000 which we hold is not the correct method of computation for benefit flowing under sec.10A – the order of the Tribunal is upheld – Decided against revenue.
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