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2016 (2) TMI 1316 - AT - Income TaxComputation of deduction u/s 10B - exclusion of expenses incurred in foreign exchange and telecommunication expenditure incurred in Indian currency from export turnover - HELD THAT:- Following the decision of Special Bench of Chennai Tribunal in the case of ITO Vs. Sak Soft Ltd [2009 (3) TMI 243 - ITAT MADRAS-D] CIT(A) directed the AO to reduce such expenses from both the export turnover and total turnover. Disallowance of expenditure attributable for earning exempt income u/s.14A - CIT(A) directed the AO to disallow 5% of exempt income as the expenses attributable for earning exempt income in so far - HELD THAT:- CIT(A) estimated the expenditure at 5% of gross exempt income as the expenditure attributable to earning exempt income for assessment year 2005-06 and we find that this is quite reasonable - in the order of the Ld. CIT(A) in confirming he disallowance made u/s.14A r.w Rule 8D(2)(iii) of Income Tax Rules. Expenditure incurred in foreign exchange which has been specifically excluded from export turnover would also not form part of total turnover for the purpose of sec.10B.
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