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2015 (7) TMI 725 - AT - Income TaxComputation of deduction u/s 10A - Held that:- In the instant case the assessee has not generated any foreign exchange out of the suo-motu disallowance made by it. In fact, the assessee has actually spent money on reimbursements and hence there is no question of generating any income out of suo-motu disallowance of the expenditure incurred. Hence, in the absence of any income, it would not be possible to say that the suo-motu disallowance of any expenditure (which has already resulted in out go of money) would give rise to receipt of any money, which can be called as income generated out of software development activity. Thus, in our view, the ratio of the decision rendered in the case of Agilisys IT services India Pvt Ltd [2015 (7) TMI 110 - ITAT MUMBAI ] can be applied in the facts of the present case also. Even otherwise it is not a case of disallowance that is required to be made under the statutory provisions due to legal fiction. We notice that the Tribunal, while disposing of the identical issue in AY 2006-07, has taken into account the decision rendered by the Bangalore bench of Tribunal in the case of I Gate Global Solutions (2007 (11) TMI 444 - ITAT BANGALORE ). Hence, for the additional reasons discussed supra and also by following the decision rendered by the Tribunal in AY 2006-07 on identical issue, we are of the view that the Ld CIT(A) was justified in confirming the order of the AO in rejecting the claim for deduction u/s 10A of the Act in respect of suo-motu disallowance made by the assessee. - Decided against assessee. Disallowance u/s 14A of the Act - Held that:- We notice that the ld CIT(A) had only set aside the issue to the file of the AO for fresh consideration in the light of decision rendered in the case of Godrej & Boyce mfg. Co. Ltd (2010 (8) TMI 77 - BOMBAY HIGH COURT) by the Hon’ble Bombay High Court. Hence, we do not find any infirmity in the decision of Ld CIT(A) on this issue.- Decided against assessee.
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