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2015 (11) TMI 851 - AT - Income TaxExclusion of expenses from the export turnover and total turnover - Held that:- As rightly argued by the learned representative for the assessee, both export turnover and total turnover shall be of the same factor. What was excluded from the export turnover cannot form part of total turnover. Therefore, this Tribunal is of the considered opinion that the Commissioner of Income-tax (Appeals) has rightly directed the Assessing Officer to exclude the expenses from the total turnover also. This Tribunal does not find any infirmity in the order of the lower authority. Deduction under section 10B - Held that:- xplanation 2(iv) to section 10B clearly says that approval by the Board appointed by the Government of India under section 14 of the Industries (Development and Regulation) Act, 1951 is an essential condition. In this case, though the assessee claims that the approval initially granted by the Development Commissioner, Special Economic Zone was ratified by the Board, it is not clear from the material available on record whether ratification was accorded by the Board constituted by the Government of India under section 14 of the Industries (Development and Regulation) Act, 1951. In the absence of any material to show that whether the approval was accorded by the Board constituted under the Industries (Development abd Regulation) Act, 1951, this Tribunal is of the considered opinion that the matter needs to be re-examined. Moreover, section 10A also gives exemption to 100 per cent. export oriented unit. Therefore, this Tribunal is of the considered opinion that the matter needs to be re-examined by the Assessing Officer in the light of the provisions of section 10A of the Act, in case the assessee is not eligible under section 10B of the Act. Exclusion of foreign travel expenses, 50 per cent. of telephone charges and communication expenses, freight outward and commission expenses from the export turnover. - Held that:- in view of the decision of the Special Bench in ITO v. Sak Soft Ltd. [2009 (3) TMI 243 - ITAT MADRAS-D ] the expenses which were excluded from the export turnover are also to be excluded from the total turnover. Since the Commissioner of Income-tax (Appeals) excluded the communication charges, foreign travel expenses, commission charges, etc., from export turnover, this Tribunal is of the considered opinion that the same are also to be excluded from the total turnover. In other words, the items which were excluded from the export turnover have also to be excluded from the total turnover. Therefore, this Tribunal do not find any infirmity in the order of the lower authority.
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