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2015 (5) TMI 811 - AT - Income TaxExemption u/s 10A - Treatment to foreign exchange rate gain on packing credit foreign currency loan - income from other sources OR income from business for the purpose of computing deduction under section 10A - Held that:- On going through the order of the Commissioner of Income Tax (Appeals), we do not find any valid reason to reverse the findings of the Commissioner of Income Tax (Appeals) in holding that the foreign exchange gain on packing credit foreign currency loan is not eligible for deduction under section 10A of the Act. The case laws relied on by the counsel for the assessee are distinguishable on facts and are not applicable to the facts of the assessee’s case. Decided against assesse. Exclusion of travelling expenditure incurred in foreign currency from the total turnover also while computing deduction under section 10A - Held that:- The Commissioner of Income Tax (Appeals) following the Special Bench decision in the case of ITO Vs. Saksoft Ltd.(2009 (3) TMI 243 - ITAT MADRAS-D), rightly directed the Assessing Officer to exclude the travelling expenditure from total turnover also. Thus, we uphold the order of the Commissioner of Income Tax (Appeals) on this issue. Excluding 50% of telecommunication expenditure incurred in Indian rupee from the export turnover - Held that:- only if telecommunication charges were incurred in foreign exchange, the same can be excluded fom the export turnover. However, in the instant case, the entire telecommunication were incurred in Indian Rupees and hence requires no exclusion from the export turnover and the Hon'ble jurisdictional Tribunal in the case of California Software Company Ltd. [2008 (8) TMI 430 - ITAT MADRAS-A] has confirmed this view. Therefore, the action of the AO is not justified in excluding the said expenditure from the export turnover as it was not incurred in foreign exchange.
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