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2015 (8) TMI 1447 - AT - Income TaxComputing deduction u/s. 10A - Exclusion of internet charges and travelling expenses incurred in foreign currency from export turnover without reducing the same from the total turnover - Held that:- CIT(Appeals) correctly following the decision of the Hon’ble High Court of Karnataka in the case of CIT v. Tata Elxsi Ltd.[2011 (8) TMI 782 - KARNATAKA HIGH COURT ] held that whatever is excluded from the export turnover, has also to be excluded from the total turnover. TPA - ALP determination - comparable selection - Held that:- Exclusion of companies unmatched with assessee's transaction of rendering software development services. Advertisement expenses apportioned - provision of marketing support services by the Bangalore Non-STP unit to NVIDIA Singapore - Held that:- Non-STP unit of the assessee rendered services exclusively to NVIDIA Singapore and none of the other STP-units had the benefit of those services. This aspect has not been considered by the CIT(A) at all. On the other hand, the CIT(A) as well as the AO proceeded on the assumption that non-STP unit as well as STP units in India would benefit from the advertisement done for NVIDIA Singapore. It is seen that NVIDIA Singapore has acknowledged that software products and advertisement is attributable to those products. Non-STP units of assessee are engaged in software development activities and do not engage in sales or marketing activities or software product. In these circumstances, we find merit in the contention of assessee that advertisement expenses apportioned by the AO and confirmed by the CIT(A) was without any basis. The said addition is accordingly directed to be deleted.
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